They may not make many headlines, but policies that help Canadians and businesses waste less energy are a win-win.

Families want lower utility bills. Businesses want to cut costs and improve productivity and competitiveness. And we all want to eliminate pollution and live in a cleaner environment. Put simply, improving energy efficiency achieves all of the above.

The federal government has introduced a number of policies under the Pan-Canadian Framework on Clean Growth and Climate Change aimed at energy efficiency. These include measures to make new buildings more energy efficient, retrofit existing buildings, improve energy efficiency for appliances and equipment, support energy efficiency in Indigenous communities and improve industrial energy efficiency. More recently, we’ve seen the introduction of additional programs to retrofit homes, schools, community organizations and affordable housing developments. These will seriously help reduce pollution while also helping Canadian homes and businesses save on energy costs — with real economic benefits to boot.

Clean Energy Canada is a think tank at Simon Fraser University focusing on the clean energy transition and the right measures to accelerate it. To that end, as part of our series to help Canadians better understand pre-existing federal climate policies, we’ve broken down the benefits of energy efficiency in Canada.

The pollution-fighting benefits

Buildings currently account for 12 per cent of Canada’s overall emissions. If you add indirect emissions from using electricity, that share jumps to 17 per cent. Heavy industry such as mining, pulp and paper, and cement production — used in many buildings — accounts for another 10 per cent. Improving energy efficiency can reduce energy waste and cut emissions across the board. Current efficiency measures are expected to reduce national emissions by 52 million tonnes, or 25 per cent of the way to our 2030 Paris targets.

The cost-cutting benefits

Efficiency measures help Canadians save on utility bills. According to analysis by Clean Energy Canada, the energy efficiency measures in the pan-Canadian framework are projected to save the average household $114 a year over the lifetime of the measures.

And the benefits reach beyond buildings. Reducing energy waste and boosting energy productivity will also help industry get ahead. Canada’s energy-intensity-per-unit GDP is higher than the U.S., Europe and Japan. This is a competitive disadvantage. Energy efficiency measures help our businesses improve their energy productivity, which in turn makes them more competitive. Our analysis shows that commercial and industrial savings could amount to $3.2 billion across Canada by 2030.

The economic benefits

Making homes and businesses more energy efficient also represents a big economic opportunity. Between 2017 and 2030, Canada’s GDP will see a net increase of $356 billion (or 1 per cent) thanks to the energy efficiency measures in the pan-Canadian framework. Every $1 spent on energy efficiency programs generates $7 of GDP.

Companies in the business of energy efficiency include those focused on improving home energy systems. Toronto’s Ecobee, for instance, is a leading provider of smart thermostats. Then there’s Fredericton-based Stash Energy, which makes home heating and cooling more affordable using “smart” heat pumps with built-in thermal energy storage systems that allow homeowners to store energy during cheap off-peak hours for use during peak hours. B.C.-based MineSense, meanwhile, helps mining operators cut both costs and emissions by improving how efficiently mining operators process iron ore.

What has Canada done on energy efficiency?

So, the benefits are clear. Now what exactly has the federal government done to make headway on energy efficiency?

The Government of Canada has put $182 million toward an Energy Efficient Buildings Program, which seeks to improve how buildings are designed, renovated and constructed. The program supports the development of net zero energy ready codes for new buildings (buildings designed to use as much energy as they produce); a code to retrofit existing buildings; and assistance to provinces and territories to help with them with regulating energy labelling and sharing energy-use data. The aim is to have new codes in place by 2022, with provinces and territories adopting the codes by 2030.

Canada has also updated energy efficiency standards for products ranging from refrigerators to heat pumps to air conditioners and, recently, launched the ENERGY STAR for Industry certification program to improve efficiency in industrial facilities. And, in 2018, the federal government introduced the National Housing Co-investment Fund to support the new construction and repair of energy efficient affordable housing stock.

But Budget 2019 went especially big, setting aside a significant $1 billion to increase energy efficiency in residential, commercial and multi-unit buildings. These investments will focus on three initiatives. First, the Collaboration on Community Climate Action program, which supports efficiency retrofits for large community buildings and demonstration projects in Canadian municipalities. Second, the Community EcoEfficiency Acceleration program, which supports the upfront costs installing renewable energy technologies and more efficient furnaces and allows homeowners to repay retrofit costs through their property tax bills. And third, the Sustainable Affordable Housing Innovation program, which supports energy efficiency improvements and on-site energy generation in affordable housing developments.

Finally, the federal government recently announced that it will fund $60 million in energy retrofits for schools located in provinces where the federal pollution pricing backstop applies: New Brunswick, Ontario, Manitoba and Saskatchewan. Further, the government said we’re likely to see a similar package of funding for hospitals and other institutions in the near future.

Energy efficiency may not draw as much attention as other policy solutions, but make no mistake: It’s one of the most important — and certainly most cost-effective — ways to upgrade Canada for the future.

Joanna Kyriazis is a senior policy advisor and Merran Smith is the executive director of Clean Energy Canada, a think tank at Simon Fraser University.

Hello Joanna and Merran. Thanks for this article.
One criticism I would have is that there is not a hint of critical thinking in it. It would be great if you could also write about the issues associated with energy efficiency policies (namely, that they have never actually reduced energy use in the past) and what can be done to overcome them.
For example, the rebound effect. Or the fact that energy efficiency reporting never considers the alternative of just not engaging in that particular activity whose efficiency is being measured (as in: one can get a regular hot tub at x kWh/y, an energy-efficient one at x - 20% kWh/y and the gain claimed here would be a 20% reduction in energy use. Well, how about nudging consumers to NOT get a hot tub at all?)
So far, past and current energy efficiency policies have never questioned our consumerist / energy-intensive ways of life, which is partly why energy use if consistently growing at 2-3% per year. How do we get to an actual energy use reduction, instead of hypothetical savings?
Perhaps you have seen it already, but this paper by researcher Elizabeth Shove illuminates these issues particularly clearly:
Thanks in advance.

My old refrigerator lasted for decades. My new one lasted only one decade before it died; I bought a new one because repairing the old one cost almost as much. My friend bought a new high-efficiency gas furnace; after only one decade it died, could not be repaired, and he ought a new one. In contrast my old gas furnace has been operating satisfactorily for well for over four decades.

When considering efficiency one must include the lifetime effect. While this new refrigerator and this new furnace may have been much more ‘efficient’, in the long term they may not have been more efficient when the energy used in making and transporting them is included.

What is needed is regulation that requires manufacturers to provide long term warranties, perhaps thirty years, then they would make things that last and thus be more efficient.

Greater efficiency doesn't mean less cost to consumers (let alone encouraging higher levels of use). In fact, as efficiency improves, along with better (less) energy consumption, the cost per unit rises. At least that has been the experience here in Toronto.
This goes hand-in-hand with time-of-use rates, residential rates subsidizing industrial rates, and per unit costs being higher for low-volume consumers than for those who use a lot of energy.
Here, the "customer charge," identical for all services, has now been hidden in "delivery charges" ... but persistent attempts reveal that it has risen at a rate far surpassing the rate charged for actual delivery costs. I.e., if you don't actually consumer *any* electricity at all for a period, the daily cost of having the connection in place goes up disproportionately.
Looks to me like preparation for privatization.
Ditto, btw, for water and waste services, where smaller volume users pay more per unit than those who consume more (and this applies to both sewage waste and solid waste services). In case anyone gets the bright idea that they'd rather pay by usage (garbage and recycling are picked up on alternate weeks, and I put out the smallest bin available about 6 times a year (as opposed to 26 times covered by the cost-per-size bin), and recycling about 8 times a year (same frequency as garbage). Larger bins pay less per volume than small ones. There is a "per bag" service, but the basic charge is larger than for the smallest bins.
There are similar dynamics at play with large multi-dwelling buildings.