Multi-Fuel Conservation: The GEGEA
| In May, 2010, the ECO released its first Annual Report on the progress of activities in Ontario to reduce or make more efficient use of electricity, natural gas, propane, oil and transportation fuels. Click here for more information on this report, including videos and communications materials. | |||||
The Ontario government altered the conservation landscape by introducing the Green Energy and Green Economy Act, 2009 (GEGEA), passed by the Ontario Legislature on May 14, 2009.
The GEGEA enacted a new law, the Green Energy Act, 2009 and amended a number of other acts relevant to energy policy. Conservation elements in the GEGEA can be grouped into four categories.
- Changing the conservation role of energy sector institutions.
- Leading by example through conservation within government.
- Improving energy efficiency codes and standards.
- Overcoming barriers to energy conservation.
The first category applies primarily to the electricity sector (although there are several implications for natural gas as well) and was discussed in Section 5.1. The remaining three categories target electricity and other fuels, particularly fuels used in space heating and water heating.
Contents |
Leading by Example
The GEGEA intends to make energy conservation a priority both within the Ontario government proper, and within “public agencies” (to be defined through future regulations, but likely to include municipalities, universities, colleges, schools and hospitals.)
Guiding principles are set in law for Ontario government facilities that include: transparent reporting of energy use and greenhouse gas emissions, ensuring the efficient use of energy, and using renewable energy sources. These principles are supported by new powers for the Minister of Energy and Infrastructure to issue directives to government ministries. Such directives may: require reporting on energy consumption; establish minimum energy and environmental standards for new construction or major renovations of government facilities; or specify other requirements relating to energy conservation, energy efficiency and the adoption of renewable energy technologies.
The GEGEA also adopts elements of the now-revoked Energy Conservation Leadership Act, 2006 (ECLA) that enable the government to require public agencies to prepare an energy conservation and demand management plan. Such a plan could include a requirement for agencies to achieve conservation targets and meet energy and environmental standards. The government can also require public agencies to consider energy conservation in procurement and capital investment decisions.
Codes and Standards
Two tools that the Ontario government has used extensively to promote energy conservation have been the Ontario Building Code and the Energy Efficiency Act. The Building Code includes minimum energy efficiency standards for building construction, while the Energy Efficiency Act allowed the government to set minimum efficiency performance standards for products and appliances sold in Ontario. The government uses these tools to raise minimum standards over time as technology and best practices improve. It also provides advance notice of proposed changes to allow builders and manufacturers to adapt to the new standards.
Codes and standards are arguably the single most important tool in the government’s toolbox. They are certainly the most powerful tool for addressing conservation in newly constructed buildings and reducing consumption as households and businesses replace old appliances and equipment. In its original proposed Integrated Power System Plan, the OPA assumed that codes and standards to deliver energy efficiency would achieve almost 65 per cent of the Plan’s 2025 conservation target.
| Codes and Standards – Timing is Everything |
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| Minimum energy performance standards are a powerful weapon in the policy maker’s arsenal. By setting and steadily increasing the efficiency performance requirements of appliances and equipment sold, the least efficient products can be eliminated from the market. A bar is set that makes formerly mid-efficiency products the new minimum standard. More stringent standards eliminate price competition for mid-efficiency products and make premium or high-efficiency products more attractive to consumers. As the average efficiency of products in the marketplace rises, the cycle can be repeated to further increase efficiency. Standardized test methods to determine efficiency across models are an essential part of this cycle, and MEI and other organizations fund development of these test methods. In 2009, the ministry contributed to funding standards and test methods for more than 30 products.
Timeliness and frequent updates of product performance standards are essential. Therefore, the ECO is concerned that the Ministry of Energy and Infrastructure last tightened standards and raised the bar in February 2006 – four years ago when Ontario Regulation 38/06 was made under the Energy Efficiency Act. (The act was revoked and has been adopted into the Green Energy Act as part of the GEGEA amendments, and the regulation is now O. Reg 82/95 carried over from the Energy Efficiency Act under the GEA.) Ontario Regulation 38/06 raised the minimum standard on a number of regulated products like air conditioners, heat pumps and thermostats. With its energy efficiency legislation, Ontario has traditionally tried to stay harmonized with performance standards set by the federal and United States governments but has recently become out of step. This means that Ontario lags behind other jurisdictions in regulating energy performance. In November 2006 and December 2008, the federal government updated energy efficiency standards for a number of products, such as: lamps, ceiling fans, traffic signals, vending machines, refrigerators and others (some provisions of the federal regulations covered the same products that Ontario regulated in 2006). There have been several announcements by the Minister of Energy and Infrastructure, but implementation of regulations has been slow in arriving. In April 2007, the minister announced that Ontario would phase-out inefficient lighting by 2012. In April 2008, the ministry announced and posted a proposed regulation on the Environmental Registry for new or updated standards for 19 products. The regulation proposed to prescribe eight new products and update the standards for 11 products already prescribed by regulation, and would have helped harmonize Ontario with federal regulation. In response to an information request from the ECO, the ministry indicated that implementation of a regulation will occur in 2010. With the passage of the GEA, the government announced its intention to lead energy efficiency standards in North America. It is expected this will begin with raising efficiency standards for certain household appliances to Energy Star levels (a high efficiency standard). The ministry consulted stakeholders on this proposal during 2009. The ECO will monitor the ministry’s commitment to leadership and the results of its consultation. The ECO believes the ministry should post a proposed regulation on the Environmental Registry explaining how the ministry intends to lead North America and move out of step with US regulations. In November 2009, the Minister of Energy and Infrastructure announced that the government was considering the need for additional new standards and specifically mentioned large flat-screen televisions that account for a growing market share of consumer electronics. We will stay tuned with anticipation. |
The GEGEA revoked the Energy Efficiency Act, but replicated its key powers to set minimum energy efficiency standards for products and appliances. It also added a new power to set water efficiency standards for products like toilets.
The GEGEA also made changes that will raise the importance of energy conservation in the Ontario Building Code. Energy and water conservation are added as specific purposes of the Code. The Minister of Municipal Affairs and Housing is required:
- to initiate a review of the energy conservation standards in the Building Code within six months of the GEGEA coming into force (March 2010);
- to appoint a Building Code Energy Advisory Council to advise the minister on energy conservation standards; and
- to conduct periodic reviews (at a minimum every five years) of the energy conservation provisions of the Building Code.
The minister appointed the Council in January 2010. The ECO will monitor the activities of the Advisory Council for inclusion in future reports. It is not certain whether an advisory council for conservation of water resources will be established. The ECO urges the minister to establish this council at an early date or immediately integrate water conservation into the work of Building Code Energy Advisory Council.
| Progress during 2009 on Efficiency Provisions of the 2006 Ontario Building Code |
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| The Minister of Municipal Affairs and Housing has made progress during 2009 on a provision contained in the 2006 Ontario Building Code by issuing a supplementary standard for energy efficiency in housing (Supplementary Standard SB-12).
The 2006 Code contained a provision that required houses to meet an energy efficiency standard that was substantially in accordance with an efficiency performance standard known as EnerGuide 80, starting January 1, 2012. According to the ministry, this would mean that a house built in 2012 would achieve an efficiency level 35 per cent higher than a house built in 2006 when the revisions to the current Building Code came into effect. The Minister along with builders agreed that a “prescriptive” approach to meeting this standard would be the preferred approach of most home builders, and would assist builders and building inspectors to follow Code requirements. Under the prescriptive approach, a number of “packages” were developed that builders can use to meet the efficiency standard rather than having to audit each house using a model to confirm that the EnerGuide 80 performance objective was met. Each package contains several measures. For example, a package may permit a builder to install a high-efficiency water heater, windows with high insulating values, and certain levels of insulation in the walls, attic or foundation, to meet the EnerGuide 80 standard. In designing the packages, trade-offs were permitted between the efficiency performance of mechanical equipment and building envelope materials and components: in other words, when constructing a house a builder can choose to install high efficiency heating or air conditioning systems but use, for example, lower amounts of insulation or lower efficiency windows in the building envelope. The level of energy efficiency for any package, contained in the Supplementary Standard, is generally equivalent to the performance objective of EnerGuide 80, and the use of trade-offs between equipment and building envelope components is consistent with the objective-based framework for the Building Code, which encourages alternative compliance paths. However, the ability to make such trade-offs, while still achieving the EnerGuide efficiency standard,means that the energy performance objective is not as high as what is possible using technology and building practices currently available. A higher level of energy performance could be mandated that would reflect advances in building materials, system and designs, and that would require both the most efficient equipment and building practices in order to reach the required performance level. The development of the next edition of the Building Code represents an opportunity to achieve this goal. ECO plans to monitor the work of the Building Code Energy Advisory Council, which we understand will be providing strategic advice on the direction of the next edition. ECO also supports the principle of wide public consultation as part of the development of the energy efficiency requirements of the next edition of the Building Code, and suggests that this consultation should include the use of the Environmental Registry. |
Overcoming Barriers to Conservation
The GEGEA also attempts to overcome barriers that can inhibit Ontarians from taking their own initiative on energy conservation.
The government had the power under the ECLA to designate goods, services or technologies that promote energy conservation. By designating a technology or service, the act allowed the provincial government to override local barriers, like municipal or condominium by-laws and property encumbrances placed by developers, which effectively prevented conservation. The government used this power in 2008 to make clotheslines a designated technology. The GEGEA replicates this power to override barriers to conservation, and extends it by providing the ability to override barriers to renewable energy projects.
The GEGEA also adds a requirement for sellers of real estate to provide information on a property’s energy consumption and efficiency to prospective buyers, unless the right to this information is waived in writing. The barrier addressed here is informational. By requiring that information on a home’s energy consumption be provided, the operating energy costs become an important factor in a buyer’s assessment of the home’s value. Energy retrofits undertaken by sellers that reduce a home’s energy consumption will be more likely to increase the home’s market value to prospective buyers.
Amendments to the GEGEA were made before the Act was passed. These amendments allowed home buyers to “opt out” of receiving the energy information. The amendments also removed the application of the energy information provision to leased properties.
The Act, as originally proposed, also included inspection and enforcement powers. These provisions covered existing inspection and enforcement powers that pre-dated the GEGEA, were contained in the Energy Efficiency Act and the ECLA and were subsequently adopted into the GEGEA. They addressed non-compliance issues, such as selling products that did not meet energy efficiency standards and interference with the use of a designated conservation technology.
The ECO believes that the provisions of the GEGEA concerning the disclosure of building energy information and the lack of enforcement provisions in the act are weaker than the original version of the bill put forward by government. The ECO believes these changes to the GEGEA conflict with the ministry’s objective to make Ontario a North American leader in conservation: efficiency performance standards and home energy ratings are now left with no enforcement provisions because of the amendments. Somewhat embarrassingly, the government has passed a law, key provisions of which it cannot enforce.
The ECO will monitor the results of this regulatory policy for inclusion in future reports to determine whether the amended provisions are effective in making energy efficiency a key factor in homebuyers’ decisions, and if manufacturers comply with efficiency standards for the sale of products in Ontario.
Implementation
The GEGEA gives the Ministry of Energy and Infrastructure strong conservation powers, but the use of these powers is at the minister’s discretion. Almost all of the conservation elements in the GEGEA will be given legal force only through subsequent regulations and directives. The breadth and depth of the government’s commitment to energy conservation will be shown by the specifics contained in these regulations and directives. With similar fanfare to the GEGEA, the government passed the ECLA in 2006. The ECLA had many of the same enabling provisions as the GEGEA, including: the ability to require public agencies to develop conservation plans and consider conservation in procurement and capital investment; the ability to override restrictions on the use of conservation technologies; and even the power to require home energy information upon property sale. Yet in the three years between passage of the ECLA and its replacement by the GEGEA, the only action taken by the government was one minor regulation that overrode barriers to the use of clotheslines. While laudable in principle and ambitious in scope, the ECLA had minimal influence on energy conservation in Ontario.
The ECO is cautiously optimistic that the introduction of the GEGEA signals a renewed interest in taking action on energy conservation, but believes that the ministry must demonstrate its interest by delivering regulations, directives and policies enabled by the act.
The government’s efforts in 2009 were dedicated to implementing the renewable energy elements of the GEGEA – particularly the streamlined approvals process and feed-in tariff. The Ministry of Energy and Infrastructure has informed the ECO that action is planned on most of the conservation elements of the GEGEA in 2010. The ECO will be monitoring these follow-up initiatives and will review them in future reports.
Citing This Article:
Environmental Commissioner of Ontario. 2010. Annual Energy Conservation Progress Report, 2009 (Volume One): Rethinking Energy Conservation in Ontario. Toronto, ON : Environmental Commissioner of Ontario. pp. 36-41
