One of the most talked about and important developments of the 21st century has been the issue of climate change. What were once-in-a-generation storms and weather events seem to occur on a regular basis. In fact, the Canadian Climate Institute says that by 2025, the previous 10 years of climate change will have shaved $25 billion off of national GDP. In other words, the Canadian economy will be $25 billion dollars smaller than it would have been if global warming had stabilized in 2015.

Canada has joined a growing list of countries, including Japan, France, and the United Kingdom, in pledging to reach net-zero carbon emissions by 2050. This means balancing the planet-warming greenhouse gasses (GHGs) we produce from burning fossil fuels with those we remove by switching to zero carbon alternatives.

What does all this mean for the businesses/buildings that are affected by new requirements?

“The business case for developing and following a decarbonization strategy is strong,” says Mark Hutchinson, VP of Green Building Programs and Innovation at Canada Green Building Council. “Decarbonizing strategies can future-proof investments by reducing risk from tightening regulatory requirements, rising utility costs, and higher carbon pollution prices. New federal tax rebates of 30 percent for heat pump technology make the business case for decarbonization even more attractive, and as the cost of carbon rises over time, the financial return on decarbonizing will only grow.”

Hutchinson further adds that decarbonization can increase the value of an asset by increasing the longevity and usefulness of it. Creating a longer lasting building that runs efficiently, for example, will help avoid a so-called “brown discount” that is associated with buildings that are less efficient and have more difficulty attracting investment over time, he adds.

Building managers have choices to make and must naturally direct their focus on areas they think will garner the greatest results. So what should be the priorities?

Nic Morgan, VP of Business Development with Morgan Solar Inc., says, “Effective decarbonization strategies require more than just reducing energy consumption or emissions. It’s important to consider the broader impact that these strategies will have on the building and its occupants.”

He further adds that, “many of the most effective interventions can improve the overall quality, comfort, or enjoyment of a space. A strategy that fails to consider these factors may lead to misleading results and overlook significant successes.

For instance, a common area that sees a 5% reduction in greenhouse gas emissions but is used 50% more frequently is a much more significant success than a simple 5% reduction in emissions would suggest. Therefore, it’s critical to track metrics that reflect the overall performance of the building and its impact on the occupants.”

Specifically, building owners and managers will want to consider how they are leveraging planned investments in the building. Choosing the right upgrades while investing in the building can kill two birds with one stone. Essentially, you have the opportunity to add value and modernize, but also meet the decarbonization needs your building requires. Hutchinson says that properly executed envelope upgrades can:

• Improved resilience to climate change by supporting passive survivability and lessening dependence on grid energy to maintain liveable space conditions;
• Improved durability, which can reduce maintenance and repair costs as well as increase building longevity; and,
• Reduced peak heating and cooling demand, which can often allow buildings to electrify and provide EV charging without service upgrades, while contributing to grid stability and reducing the need for grid infrastructure.

Morgan agrees that targeting when planning is important. “Decarbonization plans are critical for organizations seeking to reduce their carbon footprint,” he says. “However, many plans fail to address the underlying causes of emissions. When evaluating emissions, it’s common to focus on equipment and building features that generate emissions, such as lighting and HVAC systems, and overlook the reasons why they are necessary.

“It’s important to understand the root causes of high emissions in buildings. For example, lighting may be used during the day because there isn’t enough natural light reaching workspaces, and HVAC loads may be high because the building is absorbing too much heat from the sun. By understanding the why behind these issues, organizations can develop more effective decarbonization plans that start with goals rather than physical equipment.”

Gerard Wortman is Senior Energy Manager and Team Leader on the PSPC account in the National Capital for BGIS. The company has developed a Carbon Neutral Program to help in decarbonizing a large public sector building portfolio. But change usually comes with challenges. He says, for example, creating an effective research approach to reduce the number of buildings that require a detailed study, and design and implementation process, can be an important challenge for large public sector building portfolios.

Also, he adds, developing a standard study scope of work involving energy modeling and analysis can be challenging as is ensuring the expectations for the “carbon neutral study” align with consultant’s approach, ensuring recommendations and strategic direction align with other programs and strategies, and understanding the client’s funding approval requirements for the design and implementation of decarbonization projects.

Despite the challenges, Wortman adds that, “decarbonization should align with the asset strategy.” With that in mind, the message to his client with the public-sector portfolio was that, “Strategic buildings would undergo a significant renovation that incorporates decarbonization, buildings designated for long-term disposal would undergo decarbonization for the building systems at end-of-life as long as the disruption for the tenant is low, and for buildings designated for short-term disposal, no investment would be made.” Each decision is in keeping with each asset’s particular needs in mind.

Hutchinson agrees and adds that; “A cost-effective decarbonization strategy should plan for the right interventions at the right time, using a life cycle approach.” As an example, he says that replacing a fossil fuel heating plan with an electric heat pump are far more cost effective if implemented at or near the end of the system’s expected service life.

In Canada, Companies that operate facilities located that emit the equivalent of 10,000 tonnes or more in carbon dioxide equivalent of greenhouse gases (“GHGs”) per year are subject to new GHG reporting requirements for operating years 2022 and 2023 under the federal Greenhouse Gas Reporting Program.

As decarbonization plans and strategies become more mainstream, and take shape, more effective planning can take hold. Notes Morgan: “Tracking metrics that reflect the overall performance of the building is essential to accurately measure the success of these strategies. By doing so, organizations can identify significant successes and ensure that their decarbonization efforts are aligned with their broader sustainability goals.”

Also, adds Hutchinson, decarbonization will position assets “more competitively in the market and ensure that your investments provide the best possible return over time.”

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