Energy efficient houses can yield significant lifetime cost savings for homeowners. On the other hand, if buildings and neighbourhoods are built without energy efficiency in mind, inefficiencies can be “locked in” to the building stock for decades. Retrofitting for alternative energy systems can be expensive and, depending on the initial design of the building or neighbourhood, may not be practical or even possible. To avoid lost opportunities during the design and construction of new buildings, it is therefore important to adopt energy-efficient technologies from the outset of planning and building our communities.

In this year’s Annual Energy Conservation Progress Report – 2010 (Volume One): Managing a Complex Energy System, the Environmental Commissioner of Ontario examined barriers to the uptake of alternative energy systems. Why are technologies such as passive solar design, geoexchange, solar thermal and solar photovoltaic still achieving relatively low penetration in new residential developments?

One of the most commonly cited barriers to the use of alternative energy systems in new homes is the up-front costs for the homebuyer. Some financial barriers include:

• Lack of government incentives: There are currently no federal or provincial grants for new homebuyers or for builders wishing to invest in alternative energy technologies. Existing incentives focus on traditional energy efficiency measures (e.g., efficient air conditioners, boilers, etc.) rather than alternative energy systems. Further, the lack of government incentives – or the uncertainty caused by rapid changes to incentive programs – is leading to a lack of capacity in alternative energy industries and professionals.
• Home energy ratings are not mandatory: Mandatory home energy ratings can: foster a market premium for energy efficiency due to increased awareness of efficient buildings; build capacity; and, assist market transformation to a high efficiency residential sector. The ECO urges the government to enact the Green Energy Act, 2009 provision for mandatory home energy ratings at time of sale of a property.

Our report identifies several policy and regulatory barriers that could provide opportunities for change, including:

• The Ontario Building Code does not do enough to recognize the benefits of alternative energy systems: Alternative energy systems are voluntary options in housing development. The province could use the Ontario Building Code to make alternative energy systems mandatory, rather than voluntary, or use partial measures under the Building Code to encourage these systems.
• There is no tracking of alternative energy system uptake: The Provincial Policy Statement, 2005 states that planning authorities shall support energy efficiency through development patterns that promote design and orientation that maximize the use of alternative or renewable energy. However, the government has no performance indicators to determine whether this direction is achieving any effect in municipalities.
• Energy efficiency measures focus on individual buildings, rather than neighbourhoods: Energy use has been an unplanned consequence of land use planning decisions, rather than being taken into account in an integrated way during initial planning stages. A challenge for the province remains in integrating planning for alternative energy use at the neighbourhood and landscape scale. Organizations such as Quality Urban Energy Systems of Tomorrow and the Canadian Urban Institute, along with government and agency partners, have been examining ways of integrating energy planning with community design.

For additional information on the barriers to alternative energy systems in new housing developments, please see the ECO’s Annual Energy Conservation Progress Report – 2010 (Volume One): Managing a Complex Energy System.