An article in today’s Toronto Star suggests that the Ontario government may be backtracking on its intention to require home energy ratings at time of sale, a power enabled by the Green Energy Act (GEA). If true, this would be a major disappointment.

Home energy ratings provide prospective buyers with information on the expected energy consumption of a house. The operating energy costs then become incorporated into the buyer’s assessment of the house’s value, and are reflected in the market price. Over time, the market for energy efficiency features in housing (both new builds and retrofits) expands, as builders and homeowners become more confident that the upfront costs of these investments will be recovered through a higher selling price. More cost-effective investment in energy conservation is undertaken, and energy consumption and greenhouse gas emissions go down.

Energy labels have been required by law for many years for major appliances, where the “second price tag” of operating energy costs may end up exceeding the initial sticker price over the product’s lifetime. Despite the logical appeal of home energy ratings, opposition from the real estate industry led the government to weaken this section of the GEA before the bill’s passage, by adding a clause that allowed buyers to “opt out” of receiving the home energy information.

When the government introduced the GEA in early 2009, it touted “fostering a culture of conservation” as one of the GEA’s key objectives. However, as I discussed in our office’s first energy conservation report, almost all of the conservation elements in the GEA will have no impact without subsequent regulations and directives. The depth of the government’s commitment to energy conservation will be shown by the specifics of these regulations and directives. More than a year after the GEA was passed, we’ve still seen little follow-up action.

Gord Miller
commissioner@eco.on.ca

Further reading:

• Green Energy and Green Economy Act – Preview (from ECO 2008/09 Annual Report)
• Green Energy Act 2009 (Wikipedia)