Interview with Fin MacDonald of the CaGBC

Zero Carbon Building Standard Version 2

Fin MacDonald guided the recent launch of the second  version of the CaGBC Zero Carbon Building Standard,  which is designed to accelerate adoption of  zero carbon building practices. 

1. For context, when did the CaGBC start advocating for Zero Carbon design? 

Canada Green Building Council has always been interested in lowering the carbon footprint of Canada’s built environment and decreasing greenhouse gas emissions, as it significantly impacts the health of both people and the environment. LEED already takes into account carbon in its holistic approach, but things became much more urgent after the Paris agreement in 2016. A standard focused on prioritizing carbon emissions reduction was created at that time to recognize the role green buildings could play in avoiding the worst impacts of climate change.

2. What has the CaGBC learned that has prompted the release of the version 2 standard?

Canada’s buildings contribute 17 per cent of all carbon emissions – and a further 11 per cent when embodied carbon from construction is considered. To limit the rise in global temperature to 1.5°C, the United Nations’ Intergovernmental Panel on Climate  Change (IPCC) updated their recommended targets to 50 per cent GHG emissions reduction by 2030 and 100 per cent reduction by 2050. The cost of not adopting a ZCB approach increases with each passing day. Every building built today that is not designed to achieve zero carbon emissions is contributing an increase in carbon emissions – and will likely require major investments to retrofit to zero. To achieve these targets, all sources of emissions need to be considered, not just the energy related emissions. The bar also needs to be raised on energy performance. That realization prompted us to make changes to the standard, that balance the rigour needed to lower carbon emissions, but also create more flexibility in how projects get there in order to open pathways to zero for a broader range of projects. We just can’t afford to wait any longer – we need all buildings to be zero carbon buildings. 

3. What does the version 2 standard entail?

Version 2 draws on learnings from over 20 real-world ZCB-projects. These projects demonstrate that the industry is ready to raise the bar on expanded requirements for embodied carbon and energy efficiency. At the same time, Version 2 aims to get more buildings to zero, faster, by providing more options for different design strategies.

The key points of the version 2 standard are:

Embodied Carbon: Projects must now take responsibility for embodied carbon, and reduce it as much as possible before offsetting. This includes the carbon emissions for the building’s life-cycle including those associated with the manufacture and use of construction materials.

Refrigerants: ZCB Standard v2 encourages best practices to minimize potential leaks of refrigerants that, when released, can have significant short-term impacts on climate change.

Energy Efficiency: ZCB Standard v2 promotes the efficient use of clean energy with more stringent energy efficiency and airtightness requirements, but maintains the flexibility and accessibility of v1.

Innovation: ZCB-Design encourages projects to develop new skills and create markets for new technologies by requiring projects to demonstrate two innovative strategies to reduce carbon emissions.

4. The CaGBC also has a Zero Carbon Performance Standard. What is that about?

The first version of the Zero Carbon Building Standard had two pathways, one for design and one for performance. With ZCB Standard v2, we’ve broken these out into two documents for ease of use. Where ZCB-Design certification has requirements that guide the design of new buildings and the retrofit of existing ones to enable them to achieve zero carbon operations (including consideration of embodied carbon, refrigerants and airtightness), ZCB-Performance certifies buildings that achieve zero carbon operations year after year—a verification that is required annually. The two certifications work well together, but ZCB-Performance can be used on its own as well.

5. Is it the objective of the CaGBC to move the construction industry to Zero Carbon building?

Absolutely. CaGBC has proven that zero carbon buildings are technically feasible and financially viable. I don’t believe it is hyperbole to say that making the move to zero carbon is critical if we are to stand a chance of slowing the worst impacts of climate change. 

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INTERVIEW WITH: Anthony Owolabi, PACE Canada Volunteer

PACE Canada getting a foothold

Originating in California, the property assessed clean energy (PACE) program offered by PACE Canada wants to make energy efficiency and renewable energy upgrade measures affordable to all Canadians.

What is PACE?

Property Assessed Clean Energy (PACE) is an innovative financing tool which property owners can use to upgrade the energy efficiency of their buildings and install renewable energy systems with no money down and with repayment through their property tax bill. The source of funds is usually private lenders who are looking for long term, low risk investments.

The key requirements of a PACE program are that the building owner must own the property and must be paying (or be able to pay) property taxes: secondly the program will cover 100% of the financing for these types of measures:

• renewables such as solar panels and geothermal heating systems

energy efficiency upgrades such as insulation and windows

In the last five years in the USA, over 220,000 PACE projects have been completed with over $6B invested.

Who is PACE Canada?

PACE Canada is a non-profit, education and advocacy organization. We are dedicated to bringing the PACE program to Canada, and in the process will create thousands of jobs and dramatically reduce Canada’s GHG footprint.

Our vision is for every building in Canada to be optimized with renewable energy and energy efficiency measures to achieve net-zero performance – and for PACE financing to be the tool that makes the measures affordable to all.

Can you explain a little more how the financing system works?

The PACE administrator acts as a coordinator between investors (lenders) and home/property owners (buyers). Investors lend the money to home/property owners and money flows to the contractor who completes the job.

Once the project is complete, the PACE Administrator facilitates the placement of a property tax lien and the home/property owner starts repayment via their property tax bill.

Since investors provide long-term, fixed interest rate money, the model is usually cash flow positive from day one. Energy savings are meant to more than offset the increase in taxes.

What are the available markets for PACE Financing in Canada?

There are two very distinct markets for PACE financing – C Pace (commercial) and R Pace (residential). Even though there are similarities, there are major differences when it comes to implementation processes and approvals for each market.

Think of both programs sharing the DNA of the cat family, but one is a kitten and one is a tiger.

Based on US market data, the average PACE financing per project has been $456,000 for C-PACE projects and $24,000 for R-PACE projects. The largest single C-PACE financed project to date is $32 million. A C PACE best practices guideline can be found at http://www.c-pacealliance.com: (Well-Designed-C PACE-Programs-2018-07-02)

Does PACE require government involvement even down to the municipal level?

Even though the loan repayment is made through the property tax system, the municipality should have only two simple tasks – place the tax lien and collect/remit the annual payments. All other tasks should be handled by the PACE Administrator – approve contractors, projects, and upgrade types allowed; and find the investors.

What are the full economic benefits?

1. Energy Savings to property owners: Since the target is to be net positive cash flow from day 1, property owners save money on their energy bills.

2. Increased property value: Unlike subjective upgrades like countertops and paint, PACE upgrades are quantifiable and calculations can show increased property value. This feature can be translated into a higher price at the time of sale.

3. Green Jobs: Apart from the public good benefits of reduced green house gases, many new jobs are created. Statistics show that for every million dollars invested, 15 new market transition jobs are created.

4. Reduced fiscal debt: Since PACE attracts private investors, it reduces the use of public tax dollars in the retrofit economy.  Governments don’t have to provide rebates, subsidies, or give-aways that contribute to increased public debt levels.

What are the next steps for PACE Canada?

PACE Canada is committed to advocating for the adoption of a best practices PACE model across Canada. We will continue our efforts to educate governments and politicians on PACE and its economic benefits (see the website at PACECanada.green)

We will be expanding our membership base by organizing educational events on PACE and its components and to help the public understand all the PACE benefits.

Interview with Rob Bernhardt, CEO of Passive House Canada

Passive House on an upward curve

Rob works to advance building energy efficiency. A certified Passive House consultant and the developer of several certified Passive House projects, Rob is familiar with the economic and social advantages of high-performance buildings.

What is a Passive House Building and how does it work in Canada??

Passive House (Passivhaus) is considered to be the most rigorous voluntary energy-based standard in the design and construction industry today. They consume up to 90 percent less heating and cooling energy than conventional buildings. It is recognized internationally as the proven best way to build for comfort, affordability and energy efficiency of residential, institutional and commercial buildings, through all stages of design, construction, and livability.

The Passive House approach works because it’s a pragmatic combination of applied building science and economics. Designs and components vary to suit the local climate, enabling comparable levels of comfort, hygiene and performance in varied climates.  All Passive House buildings are designed using detailed energy modelling software, which allows the design team modify the architecture and specify the combination of insulation and components required to bring a building to the required performance standard in their own climate zone.

Why was Passive House Canada created?

Passive House Canada was incorporated by practitioners wanting to transform Canada’s buildings, making the multiple benefits of high performance buildings the norm. We started with few high-performance resources in Canada but have ramped up resources through educational services, events, advocacy and communications over the few years we have existed.  With time Canada’s policy, regulatory and incentive environment has become very support of Passive House as the level of building efficiency required for Canada to meet its Paris commitments become apparent.   

Why do you think the movement has been successful so far?

The successes that we have experienced are directly attributable to the dedication of industry professionals and elected officials who are passionate about sustainability.

Their momentum and enthusiasm has given us the privilege of assisting all levels of government in building policy development, the ability to support the growth of a national membership of over 1,100 members (in eight provinces and two territories) and deliver hundreds of courses, with over 5,000 registrations across Canada. 

This appetite for a higher standard of building bridged partnerships resulting in the launch of Canada’s first Zero Emissions Building Exchange in Vancouver and a successful inaugural national conference with over 350 delegates attending each year.

Why do you think people are making the change to Passive House buildings?

While the initial driver is, of course, environmental and the common goal to mitigate climate change, this alone does not catalyze market transformation, represent the motivation of everyone involved, or simplify the process of managing change. 

For many, the primary motivation is a desire to have better buildings. The unparalleled comfort, health, durability, resilience and affordability of buildings offering Passive House levels of performance are reason enough to make the choice. Affordable housing advocates may focus on the reduced costs of ownership, operation and utility costs to tenants, homeowners on the comfort, while absolutely everyone craves a constant supply of filtered fresh outdoor air.

Some professionals, developers and trades are attracted by the quality of work such buildings entail and enjoy the pride of workmanship. Others know high performance building regulations are coming and are looking for a competitive advantage, a market differentiator, in establishing their company brand. Increasingly, some are simply responding to the developing market for Passive House buildings and their components, which they know will grow.

Why do you feel Canada is winning in the change to Passive House building?

During our 2018 conference, the federal government took the opportunity to say it is probable that the final tier of the Net Zero Energy Ready Code will be very close to Passive House standards. This is a significant win for Canada, and with recent budget support we can see our national buildings strategy taking root across cities and provinces, nationwide.

We know our role at PHC will change and likely diminish as building codes and standards approach Passive House performance levels and we can’t think of a better reason to become redundant.

Taking a “mission first” approach enables more rapid progress, facilitating collaboration with industry and consumers in addition to government. We can best achieve our mission by collaborating with aligned groups and individuals, and we invite you to do the same.