As members of the Canadian green building industry, we see a fundamental shift happening in the way the built environment is perceived as a means to achieve emissions reduction targets. Add to this the introduction of new groundbreaking policies and legislation from governments at all levels, and we’re looking at one of the most promising years for our industry in over a decade. These are the Top 5 trends in building that CaGBC will be prioritizing in 2018.
1. Zero Carbon not Zero Energy
Energy efficiency has long been used as the measure of how “green” a building is. It’s also been used as a proxy for how well it reduces carbon emissions. However, energy efficiency and carbon emissions do not always move in lockstep. Improved energy efficiency does not necessarily yield proportional reductions in carbon emissions. This disconnect stems from the fact that efficiency does not take into account the type of energy being used or its corresponding carbon footprint. Put another way, measuring a building’s energy efficiency is an indirect strategy for reducing carbon emissions and can depend upon the source of energy in a particular location.
Often, as with the federal framework for Canada’s Clean Fuel Standard released in December, the strategy for reducing carbon emissions has assumed that our traditional fossil fuel-based infrastructure and economic systems will continue, albeit with stricter regulations. While this is a step in the right direction, ultimately, if we want to maximize carbon reductions, there needs to be a rapid shift to high-efficiency systems that rely on low-carbon, renewable energy sources.
Building owners stand to gain by making this shift. Transitioning to low- or zero-carbon buildings allows them to prepare their portfolios for a rising cost on carbon, even helping them to possibly avoid these costs altogether. It is also the best way to future-proof buildings for a world where fossil fuels will cease to be a desirable energy source.
2. Going retro(fit)
In 2005, large buildings in Canada were responsible for an estimated 41.8 megatonnes of annual GHG emissions; meanwhile, more than 50 per cent of these buildings will be operational in 2050. It’s clear that improving the carbon footprint of our existing building stock will be instrumental in Canada achieving its climate change targets. In fact, CaGBC’s 2017 report, A Roadmap for Retrofits in Canada, found that a combination of recommissioning, deep retrofits, on-site renewables and fuel-switching could reduce emissions by 51 per cent below 2005 levels.
To date, governments (and their agencies) at all levels have established policies, programs, and financial incentives to encourage building retrofits, mostly to achieve energy efficiency objectives. Most government interventions thus far have been focused on subsidizing retrofit activity (e.g. with rebates) and, to date, have not been designed to support the holistic market infrastructure that is needed. While these policies and programs are valuable in creating incentives for building owners to retrofit their assets, there will never be enough public funding dollars to complete the retrofits needed within the existing building stock.
The pressure to redefine the economic model for our existing buildings is mounting. Canada needs a robust and dynamic retrofit economy where market-based solutions align supply and demand for retrofits in response to policy objectives. A retrofit economy where businesses and individuals are incented to reduce their GHG emissions will also create a robust and dynamic marketplace ecosystem of participants who generate commercial innovation in construction approaches and building technologies that will unlock new economic activity and new jobs for Canadians.
3. The value of data
In a carbon-constrained world, we must have an accurate understanding of the performance and resource consumption of our buildings to help us strategically plan conservation efforts and manage efficiency. Increasingly, there will be an expectation from tenants, clients and employees for owners and managers to not only track and measure a building’s consumption of energy, water and other resources, but also to pinpoint exactly how it is being used. These data points will likely become important signals for a property’s perceived value.
As well, we will likely see more requirements for building owners and managers to provide energy reporting and benchmarking to local governments and provincial authorities, such as Ontario’s recently announced Reporting of Energy Consumption and Water Use regulation for buildings of at least 50,000 square feet. Tools such as ENERGY STAR Portfolio Manager and the new Arc platform – both of which allow building managers to monitor and benchmark sustainability performance data – will help in the drive to identify areas for improvement and optimization, along with providing opportunities to highlight green leadership with buildings that are performing well.
4. Taking a holistic approach to sustainable building
In our quest to address climate change through energy efficiency and carbon reductions, we must not lose sight of the broader goals of sustainable building design, construction and operations. A holistic approach is one that includes the preservation of natural resources, reduction of pollution, prioritization of ventilation and air quality, procurement of non-toxic materials and extensive waste diversion, to name just a few. As an industry we are also increasingly aware of how green buildings can make the people inside them healthier, happier and more productive – factors that play a large role in driving companies to invest in green building today.
It will be important to keep leveraging the learning our industry has gleaned from the implementation of LEED and other green building standards to make careful design and operational choices that continue to advance all aspects of sustainability. This could mean integration with newer programs too, such as the WELL Building Standard, which measures occupant well-being in seven categories, or TRUE Zero Waste, which supports public health by reducing litter and pollution through a focus on diverting waste from landfill. It’s a strategy that truly showcases the significant impact of green building on daily life and highlights how easy it is to get started in improving the sustainability of the built environment.
5. Accounting for the future
Another key shift we are observing is the move towards a full-cost accounting approach that incorporates carbon into the evaluation of the cost of owning, constructing and operating a building.
The introduction of carbon pricing nationally and cap-and-trade regimes in some provinces could be the most effective tool to distinguish high-performing buildings from their competitors. The introduction of carbon pricing in all jurisdictions will represent a “leakage” of value for building owners and the businesses and individuals that lease from them. This leakage is the loss of operating cash flow and the reduction in value of the asset as a result of increasing operating costs associated with the implementation of carbon pricing systems.
Additional changes we can expect relate to how building investments are evaluated. With the growing restrictions on carbon, it will be imprudent to base development decisions exclusively on capital costs. Rather, in the years to come a building’s projected operational and maintenance costs will increasingly inform when and how significantly a building owner invests in efforts to reduce energy consumption and GHGs.
Support CaGBC’s efforts to move the needle on these priorities