Natural Resources Committee on Dec. 6th, 2018

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You mentioned that you mainly deal with new builds. What's the price differential of, say, building just a normal, run-of-the-mill building versus something that—I'm not talking about passive levels—you would consider an energy-efficient building? What's the price differential, give or take?

[Jim Lord]

It's always hard, because every building's very different. If you were to go back 10 or 15 years, the price difference would have been very large. Now, with building codes and modern construction techniques, the price differential is not that large from a construction standpoint.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You talked—

[Jim Lord]

It's not like 2.8% or something like that, but what we're finding is that regular builders can build high-efficiency buildings in their budgets, so that means it is attainable.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You talked about how people have changed their minds over the last 10 years. They didn't think you could do this, and now they want to do more.

We had a hotel built in my hometown, and the architect wanted the hotel owner to build this really energy-efficient building all out of mass timber construction and wood that was very tight. The owner wasn't very keen on it, but after it was built, the price difference wasn't that much, and then the owner asked, “Can you build me another one just like that only twice as big?”

Are you getting into structural materials as well? I'm thinking of mass timber construction with its tighter builds and all the storing of carbon in the actual materials themselves. Is that part of your view?

[Jim Lord]

Certainly, I think that's part of the future. As you said, getting clients on board takes a bit of time, and we'll need probably a few more examples like the one you mentioned for people to say, “Yes, I'm only going to build that out of mass timber.”

But we are seeing people who are going to zero carbon. They have clients who want to do that. They are looking at embodied carbon in the products that are put into the building, using things like LCAs. Those things are happening. We weren't talking about this three years ago or four years ago, so when we're sitting here in 2022, you'll be saying, “Yeah, yeah, that's old news. Everybody's doing that”, hopefully, if we can continue in this direction.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You mentioned that it's the retrofits that will get us the gains in the near term.

In a broad sense, what do you think the best incentives are that this government could provide the industry for getting building owners to tackle those retrofits?

[Ragui Barsoum]

From my point of view, I think the idea of publicizing building performance—making sure it is transparent to the tenants and to the people who pay for the energy in the long run—is one of the first keys. If we can expand on that idea, where it puts pressure on landlords to be transparent to their tenants on how the building performs and what sorts of materials are in there, I think that is primary.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

It's just more of that transparency for tenants, but is there something that the government could do directly with building owners?

[Jim Lord]

I think the number one thing is building commissioning for existing buildings. Commissioning is really going in and optimizing all the systems, relooking at how they work together.

You build a building and it comes with a manual showing how it all works, but 35 years later, the tenants are configured differently, the number of occupants in the building is different, some of the systems have been changed and quite often you're still running it the way you were running it on day one. There's no right or wrong way to run a building, but there are ways that use more energy and ways that will use less energy.

There is a whole bunch of studies around different successes with building commissioning, where you might save 20% of your energy, in a good case, without changing any equipment, just changing the way that you actually run the building. I think things like that are low-hanging fruit. If we could do that across all of the buildings in Canada, there would be tremendous savings.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

You just talked about codes. I'm just wondering if you could comment on, or if you are familiar with the step codes in British Columbia and how those sorts of programs could drive the way for new builds.

[Jim Lord]

Yes, certainly, the step codes in B.C. and now the Toronto green standard and the way it's future-looking, I think, give builders an idea of what's to come, so that they can continuously change their process. Their horizon is that, if you buy a piece of land, you're not necessarily going to build on it for two or three years. Having an idea of what's going to come in the code does help. I think that is certainly the way of the future.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

[The Chair, Liberal, James Maloney]

Thanks.

Mr. Tan.

[Geng Tan, Liberal, Don Valley North, ON]

Thank you, Chair.

You talked about green energy and green technology. When you try to convince your clients to incorporate new technology or green technology to increase their energy efficiency or reduce the pollution from their buildings, how do you make sure that the companies, or your clients, are not affected in terms of their ability to meet their operational needs?

Perhaps they have to shut down their building for you to do a renovation, or.... How do you convince them and what kind of assessment do you give to them?

[Jim Lord]

Doing an energy model of the building is one of the key parts to any of these new construction building measures and figuring out what you need in the building—looking at the amount of energy the different systems will use and the potential systems they might put in and sizing them accordingly. That allows you to know how much energy you need in the way of solar or other renewables.

We are able to model geothermal systems, and we model renewable energy systems like solar as well. We use those models to predict and make sure. Usually these buildings are also connected to the grid, so if things change too much they can always use the grid power as well.

[Geng Tan, Liberal, Don Valley North, ON]

We heard from witnesses that they found it quite a challenge to achieve the energy efficiency in a very cost-effective manner. When you try to convince your customers, I guess the big resistance is from senior management. What strategy or what experience do you have when you talk to those people and try to convince those people? You just answered Mr. Falk's question that touched on that. I wanted you to tell us more.

[Jim Lord]

I think it's being able to provide examples of buildings that have done that in a cost-effective way, and being able to basically provide a business case. Sometimes senior management are the ones who are very keen on that, as part of their corporate mandates—that happens quite often—but really it's being able to point to projects that have been successful using the strategies that we're recommending, and showing them that they can do it without too much cost. That's why people like the Canada Green Building Council offer tours of these buildings, so that other developers can come out and see what people have done. You can talk to the building operations staff, and you can get a degree of confidence. You look at the risk of doing this and of it not working, and you try to minimize that risk. That's what our clients are generally looking for.

[Geng Tan, Liberal, Don Valley North, ON]

In your presentation, you talked about some examples of buildings. Can you give us one specific, successful example where you helped your clients to reduce their power consumption or identified optimization for their equipment or relevant to their equipment? With these new capabilities or new changes, how much money can your client save in five years, 10 years or even in the long run?

In your opinion, or from the feedback from your customers, how will these changes improve the reputation of their company around their sustainability, their social image or whatever? What is the benefit, not just in terms of cost but also in terms of social image?

[Jim Lord]

We have a client for whom we've done LEED, which included energy efficiency and those sorts of things, and they use that as a tool to recruit new employees. You'll find that a lot of large companies are insisting that they be in buildings that have the LEED certification. We've seen people like the Googles, the Apples and those guys. They all want to be in socially responsible buildings.

It's not just about saving energy. It's about your reputation, and your reputation among your employees that you are a good company and this is part of your culture. It's more than just the dollars and cents. The dollars and cents are there, and we've seen it.

If you look at the number of buildings that have converted to LED lights, for example, pretty much all the major buildings have done it. There are a few left to do, but not that many, which is excellent. It just shows that these sorts of things have the payback. It's been proven that the payback is there, so everybody else just jumps on board and does it.

[Geng Tan, Liberal, Don Valley North, ON]

How possible is it that your customers recommend your solution to their partners, their customers or their peers?

[Jim Lord]

It happens all the time. Our number one way of getting new customers is through recommendations from existing customers. The energy efficiency industry is a bit different from other industries, in the sense that when people have a success, they like to talk about it. They like to bring it up at conferences. They like to share it with other people.

Once someone comes up with something, it's not like a trade secret where I'm only going to use it in my buildings. It's very much, “Here's what we did. We were the first—yay!—but now you guys can all jump on board,” and the suppliers and vendors who helped them with it are also out there promoting it. Unlike other industries that might be a bit more secretive, it's sort of a more fun, open, collaborative industry.

[Geng Tan, Liberal, Don Valley North, ON]

Do you do more small-scale or large-scale projects? What's the big difference between these two scales?

[Jim Lord]

We do both.

[Geng Tan, Liberal, Don Valley North, ON]

Technically or moneywise...?