Throughout the Committee’s study, witnesses discussed a variety of ways in which to increase the energy efficiency of federal buildings. These “solutions” have informed the Committee’s thoughts and recommendations about potential avenues for enhancing energy efficiencies in federal buildings.

A. The Views of the Witnesses

While there is no “one-size-fits-all” solution for the wide-ranging inventory of federal buildings, there are several tools that can be used to achieve increased energy efficiency and lower energy costs. Whether the building is owned or leased, energy efficiency measures are more likely to be implemented when building owners and occupants are provided with incentives to increase the energy efficiency of the building. In the opinion of the Committee’s witnesses, energy-efficient federal buildings can be realized through the use of higher targets, policies and processes, building codes, strategic planning, integrated building design, energy performance contracts, energy-efficient equipment, revolving funds and “green leases.” As well, in the context of energy efficiency, witnesses spoke about building commissioning and recommissioning, assessments and industry-recognized building certifications, on-going monitoring, coordination among federal departments, as well as awareness, education and training.

1. Leadership through Targets, Policies and Processes

The Committee was told that some organizations face a challenge in assigning qualified people to the development and implementation of energy efficiency initiatives while providing them with clear objectives.[100] However, a PWGSC official noted that the 2010–2013 FSDS set targets that were “clear and [that could] be reported against,” and that departments had to report their own targets.[101] In speaking about whether departmental performance reports (DPRs) include energy reduction targets, an official from PWGSC said that these types of targets are not included in DPRs.[102]

Regarding the energy efficiency of buildings, Stephen Carpenter (President, Enermodal Engineering) commented that “the track we’re currently on isn’t going to get us where we need to be when we start looking at the issues of energy use.”[103] He continued, “It begs the question, how do we achieve more energy-efficient buildings if the track we’re currently on is not getting us there fast enough?”[104] A number of the Committee’s witnesses said that the solution to achieving buildings that have a higher level of energy efficiency involves implementing improved policies and processes, rather than adopting new technologies or allocating new money, as funds are already being allocated to pay buildings’ high energy costs.[105] Some witnesses suggested setting mandatory energy conservation and energy efficiency targets for all new and existing federal buildings, as well as for buildings that receive federal funding.[106] Laverne Dalgleish (Principal, Building Professionals) stated that, without a target, it is difficult to reach desired outcomes. In his view, the creation of targets provides an opportunity to not only achieve, but to go beyond, the target.[107] Doug Cane (Principal, Caneta Research Inc.) advocated an approach similar to that which is being adopted in Europe, where targets for desired energy consumption per square metre are established.[108]

Mr. Love noted that governments in other jurisdictions, including the United States, Ontario and British Columbia, have established clear and measurable targets for buildings and a global objective in relation to energy efficiency buildings; these targets and objectives “forces departments to focus on achieving a target.”[109] For example, an official from the province of Manitoba explained that her province’s energy target for new government buildings requires a building to be 33% more energy efficient than “the model-compared building under the 1997 energy code.” She also said that targets will be updated as new energy codes are developed in the province.[110] In the late 2000s, the United States established significant water-reduction targets for its federal agencies; they are required to reduce, by fiscal year 2015, their water consumption intensity by 16% from the intensity that existed in fiscal year 2008.[111] Through the use of legislative tools, the United States federal government has made progress towards its energy use goals as established by various statutory requirements and executive orders.

According to Mr. Love, clear and measurable targets are key elements in determining the path required to achieve desired goals, including in relation to energy and water use, recycling and indoor air quality. He commented that, in order to ensure that people are focused on achieving the desired target, federal departments could be responsible for setting their own targets.[112] In speaking about building targets, Mr. Carpenter told the Committee that, as carbon targets are currently global, it would be easier and more achievable for building design teams if each building had its own target.[113] Moreover, Mr. Love said that targets could generate friendly internal competition, which could result in innovation.[114]

Mr. Mueller shared the results of studies by the Canada Green Building Council that found that energy consumption per square metre in Canadian office buildings is between 290 and 350 kWt hours, with an average of approximately 320 kWt, depending on the region; this amount can be compared to a target of 100 kWt hours in Europe.[115] Mr. Carpenter suggested the establishment of an energy efficiency target that would require every new office building to use around 250 kWt hours per square metre, which would be a reduction of approximately 22% from the current average level of use.[116]

According to Mr. Carpenter, the federal government could use the ENERGY STAR program, which is expected to be released in Canada in the coming months, to establish energy efficiency targets.[117] With a scale from 0 to 100, with 0 being the worst building in terms of energy performance and 100 the best, he proposed targets of at least 75 and 85 for new and existing federal buildings respectively.[118]

Some witnesses told the Committee that labelling the energy performance of buildings in a manner that is similar to that in Europe, would provide valid information to future occupants, and would motivate building owners to improve further the energy efficiency of their buildings.[119] For example, Mr. Cane mentioned that Canada does not have a process for labelling a building’s energy performance; in his view, this labelling could be implemented in Canada alongside building codes.[120]

2. Building and Energy Codes

Several witnesses spoke about how national and provincial energy codes for buildings could help to reduce energy consumption. Mr. Staszenski explained that building and energy codes could be an effective tool to improve energy efficiency in all buildings, including those occupied by the federal government.[121] Mr. Cane noted that, compared to a 1997 version of the Code, the NRC’s National Energy Code of Canada for Buildings 2011 yields savings in building operating costs that are usually 25% greater.[122] He also indicated that his company had recently completed a study about developing code proposals for encouraging energy efficiency upgrades during renovation in large buildings.[123]

3. Strategic Plans for Building Management

Mr. Staszenski proposed the use of a strategic approach — “audit-implement-monitor,” or AIM — rather than a reactive or tactical approach[124] to improve energy use in federal buildings.[125] He explained that this strategic approach involves, as a first step, conducting an audit of the building; the next step is developing a strategic plan that evaluates the capital renewal costs over a long period of time, such as 25 years. The third step is implementing energy efficiency measures, while the last step is monitoring the measures that have been implemented. He mentioned that, under a strategic approach, a building manager looks at the global impact of a specific upgrade. According to him, “in terms of the audit, implementation, and monitoring world — in the audit world you start to do the planning that is required to make those good, sound decisions. In that planning process, you're looking at what your long-term plans are for building renewal; that's very important.”[126] In that context, an official from NRCan told the Committee that his department, as well as the departments with which he works, develop a building management plan that has an energy efficiency component for every building; those plans are updated regularly.[127]

4. Integrated Design for New Buildings

A number of the Committee’s witnesses shared their view that integrated design is critical for new buildings. In speaking about this type of design, Mr. Mueller said that it is important to consider broader issues, such as sustainable building design in terms of the building’s intended use, its operation over time and its long-term environmental impact; with those considerations in mind, the key is to involve the “right players,” who are not necessarily the lowest-cost “players,” in order to design a building that is highly efficient.[128] In his view, architects play a very important role in new building construction because they are typically the proponents for an energy-efficient design, but engineers, the commissioning agents[129] and a good builder are also needed.[130]

Regarding new building design, it is possible to model a building’s expected energy performance based on its expected energy use. Mr. Mueller informed the Committee that modelling energy performance can be done through computer programs that estimate the amount of energy that a building will use. He also said that, as the private sector gathers more information about the actual performance of buildings, there is a tendency to focus on numeric targets in relation to energy use by buildings.[131]

5. Energy Performance Contracting for New and Existing Buildings

According to some of the Committee’s witnesses, there can be a financial challenge in making major energy retrofits, including those to federally owned buildings. Energy performance contracting is one tool that can be used to overcome the financial challenge. An official from PWGSC said that governments want to avoid making significant investments in their “bricks and mortar,” preferring to make investments in places and programs that serve the country’s citizens.[132] A number of the Committee’s witnesses identified an EPC, or an energy savings performance contract, as one way in which to overcome the financial barriers associated with financing retrofits designed to improve a building’s energy efficiency.[133] According to Mr. Love, with EPCs, the capital cost of a project for building renewal — such as the purchase and installation of energy efficiency measures during building renewal or reconstruction — is financed through future savings on the building’s utility bill.[134] Mr. Seymour told the Committee that:

[An EPC] is a great way to make improvements to the cost-effectiveness of government operations, to reduce the impact on the environment, to create jobs now and in a green sector, as well as to fund some much needed facility renewal or infrastructure improvement within the government workspace. Much of [these improvements] can be accomplished without needing new federal funds.[135]

Under an EPC, an energy service company[136] takes on the technical[137] and financial risk associated with an energy project; if a problem arises, the company has responsibility, and remediation occurs in accordance with the terms of the contract.[138] There are two types of EPCs: in the first, contracts are structured so that savings are guaranteed by the energy service company to meet or exceed total annual contract payments; in the second, the costs are shared between the energy services company and the building owner or occupant, with payments based on energy and operational savings, and a stipulated maximum energy consumption level over the life of the contract.[139] According to Mr. Love, if the guaranteed energy savings are not realized, the energy services company is responsible for the difference between the actual energy cost and the guaranteed level of energy performance.[140] When the period of an EPC ends, the building owner is the beneficiary of any future energy cost reductions.[141] To illustrate this concept, Mr. Love explained:

You invest $100 in the energy efficiency of a building and there are guaranteed savings of 15% to 20% … and it's that income flow for the period of the contract that is used to pay off that initial $100 investment. After the end of the contract, those energy savings accrue to the building owner.[142]

An EPC has two main cost components: the performance guarantee fee and the financing charge. According to Mr. Seymour, under the FBI, these two cost components are disclosed separately as part of the EPC proposal.[143] In speaking about whether an EPC is competitively priced, he indicated that, while an individual energy service company may consult various financial institutions in calculating the financing charge, there is a limited number of both energy service company competitors and financial institutions involved in performance contracts with the federal government.[144]

Mr. Love commented that the involvement of the private sector, through the energy service company, brings innovation and expertise in the area of enhancing energy efficiency in buildings.[145] As well, the Committee was told that the involvement of an energy service company as part of an EPC, means that problems are identified and resolved by the private-sector partner, often proactively.[146] He added that EPCs are well-suited to more complex projects. According to him, when there are mechanical, electrical and other considerations involved in an energy retrofit project, EPCs can be useful in ensuring the completion of a comprehensive turnkey project.[147]

The Committee heard from some witnesses that energy retrofits using EPCs can lead to higher costs. According to Mr. Staszenski, under an EPC “you have to know that you're going to be paying 20% to 40% more for those retrofit costs.”[148] He added that, “when you do an [EPC], you're buying insurance, and they put a premium on the retrofit. That's why it's more expensive.”[149] An official from NRCan commented that “the number of 20% to 40% … sounds a bit high.”[150] She added that if a project is financed externally, it will cost more than if it had been financed internally.[151] Some of the Committee’s witnesses indicated that simple energy efficiency retrofit projects could be done without EPCs. For example, both Mr. Love and Mr. Rogers commented that lighting projects can be very cost-effective and the return on investment can occur within a very short period of time.[152]

Through its FBI, NRCan is trying to facilitate the use of energy performance contracting in the federal government.[153] Under this initiative, and with the assistance of energy service companies, the federal government has completed energy retrofits in about 33% of its buildings, and a number of the Committee’s witnesses supported the initiative’s continued use.[154] According to an official from NRCan, “[i]n a world of funding constraint, FBI provides an essential vehicle to fund capital investments for retrofits.”[155] Mr. Love also commented on the FBI, stating: “You have a great mechanism. The [FBI] … has been going for 20 years. It assists other departments in doing this [energy and facility renewal] work, but we would like to see many more contracts being done by the federal government using this mechanism.”[156] Mr. Seymour agreed that FBI projects to date “have been successful, [are] meaningful, and … are indicative of the ample opportunity that still exists for Natural Resources Canada's federal buildings initiative to flourish.”[157] An official from NRCan told the Committee that:

…departments typically don't have familiarity with energy performance contracting unless they've done one before, so [NRCan] created a set of model documents that are specific to this type of contract and are available for departments to use. [NRCan] also [does] the front end work in qualifying the companies in Canada who have the expertise, the knowledge, and the financial capacity to conduct one of these types of contracts. There are eight companies in Canada with access to $700 million in financing for energy performance contracts.[158]

These energy service companies are screened to meet all of the FBI program criteria and are listed on NRCan’s FBI Qualified Bidders List.

The Committee was informed that other jurisdictions work with third parties through energy service performance contracting or utility energy service contracting.[159] In the United States, federal building projects in 2011 included approximately $369 million, financed through EPCs and $165 million, financed through utility energy service contracts.[160] In Canada, the province of British Columbia uses a third party to oversee the management and operation of its buildings in relation to energy performance. [161] An official from Shared Services BC explained that:

[P]artnerships are very important for us, and one of our most significant partnerships is with the utilities in our province. Approximately 30% of our capital costs for projects are incented through our local utilities. BC Hydro is an example. It provided almost $1 million over the last two years in energy efficiency incentives, as well as human resources to help support the work we do.[162]

Furthermore, the official said that the business case for all of the province’s energy efficiency initiatives is based on the return on investment: the initial capital cost must be repaid, within five years, through operational “cost avoidance” as a result of energy cost savings.[163]

Public-private partnership (P3) agreements for newly constructed buildings are similar to EPCs, in that they represent performance-based contracts; as with EPCs, P3 agreements can be drafted to include energy performance requirements. According to Mr. Carpenter, under a P3 model where the private sector is responsible for designing, building and operating a building for the federal government, the private sector should also be responsible for guaranteeing the energy performance of that building.[164] He stated that, with the increased use of P3s, the federal government should consider ensuring that — where appropriate — all P3 contracts include guarantees regarding energy use. This approach has been used in the federal government for the P3 project in relation to the Royal Canadian Mounted Police (RCMP). An official from PWGSC highlighted that the “P3 project for the RCMP E Division in Surrey, British Columbia, includes a requirement that the proponent achieve LEED [G]old certification. [The] lease require[s] [the private sector partner or proponent to] achieve a certain efficiency as part of the contract.”[165]

Energy efficiency projects that are financed through EPCs include a payback period, which is the length of time required for the project to break even; as required by the terms of the EPC, the energy service company’s capital investment in the project is repaid by the building owner through the energy cost savings within a period of time known as the payback period. The payback period varies regionally, as energy is less expensive in some provinces than in others.[166] To date, the average payback period on EPCs used in the federal context has been fairly short. According to Mr. Seymour, in order to finance major projects for infrastructure renewal, the government should consider using a longer payback period, which would allow a higher capital investment and, thereby, buildings that could both perform better and perform better for longer.[167] With respect to the future use of NRCan’s FBI, an official from NRCan noted that there are 13 sites across Canada where the department believes that there is as much as $8 million in project investments that can be financed through EPCs under the FBI.[168]

Under PWGSC’s management, the Parliamentary Precinct Branch is currently in the first year of a program to increase energy efficiency in existing buildings. According to an official from PWGSC, the total cost of planned projects exceeds $2.8 million, and the investment in those projects is expected to be repaid through energy cost savings over a payback period of 3.4 years to 8.8 years.[169]

6. Energy-Efficient Equipment for Retrofits to Existing Buildings

Energy retrofits to existing buildings can include the installation of energy-efficient equipment and the use of new technologies. According to Roberto Montanino (Commercial Programs Supervisor, Manitoba Hydro), “[m]ore efficient equipment tends to not need to work as hard, therefore extending the life of the equipment.”[170] In addition,Mr. Dalgleish mentioned that energy-efficient technology is available and it should be considered for improving the performance of buildings — “whether it be high performance insulation, high-performing windows, or extremely high efficiencies on mechanical equipment.”[171]

An NRCan official told the Committee that his department was very active in the research and development of energy-efficient building technologies in the areas of lighting, building design, heating and cooling, and a variety of technologies and controls.[172] Regarding research, Mr. Dalgleish suggested that the federal government should increase funding to the NRC in order to facilitate the development of new products, technologies and methodologies related to reduced energy consumption by buildings.[173]

Mr. Eickmeier told the Committee that major energy retrofits can involve significant upfront costs and are not always seen as an attractive investment, especially in relation to privately owned buildings with long-standing occupants, including the federal government.[174] Several witnesses stated that favourable tax treatment for the purchase of equipment, such as a high-efficiency furnace, would help property owners to finance retrofit projects.[175] According to Mr. Eickmeier, although tax incentives would favour the private sector, the federal government would benefit from energy savings resulting from the energy efficiency upgrades to the buildings it leases.[176]

Mr. Eickmeier also informed the Committee that costly building expenditures — such as those for boilers and chillers — are generally depreciated at the rate of 4%, which is the same rate applied on any other fixed capital investment. He argued that costly building expenditures should receive a 50% average depreciation rate.[177] Moreover, in his view, this type of tax incentive would have a positive impact on the number of major energy retrofits; the benefits of the retrofits would include a renewed building stock, enhanced job creation, increased profitability, and reduced energy consumption, greenhouse gas emissions and air pollution.[178]

7. Revolving Funds for Retrofits to Existing Buildings

The Committee was told that revolving funds are one way in which building retrofits could be financed. Mr. Staszenski told the Committee that PWGSC should establish a revolving fund[179] through which federal departments could access interest-free capital; the loans would be repaid through the savings realized from reduced utility costs resulting from energy efficiency upgrades. According to him, such a fund would lead to savings for the federal government, as departments require support to implement energy efficiency measures in buildings that consume a lot of energy.[180] He provided examples of revolving funds at the municipal level. For example, the City of Toronto has a revolving fund of $22 million, while the City of Edmonton has a fund of $5 million.[181] According to Mr. Staszenski, funds must be easy to access in order to be useful.

In commenting on whether a revolving fund could increase the number of federal buildings being retrofitted under the FBI, a PWGSC official indicated that the private sector funds the FBI; in his view, the need for a revolving fund is not “that evident when … look[ing] at the structure of how the FBI is constituted.”[182]

8. “Green Leases” for New and Existing Buildings

A “green lease” encourages sustainable practices by both the owner and the occupant, and promotes reduced energy and water consumption, increased recycling and the use of sustainable materials in building improvements made by occupants.[183] A building lease can be designed in a number of ways, with the owner and/or the occupant partly or wholly responsible for utility costs. According to Mr. Eickmeier, when utilities are paid by the owner, “[a green lease] sets targets within the lease agreement with the [occupant]. So it's not just simply saying that [occupants] will occupy this space for five years, but that they will meet or exceed certain targets toward energy, water, and waste reduction.”[184] An official from PWGSC told the Committee that, for Crown-leased buildings:

[T]he cost of energy is normally included in the cost of the rent … through a triple-net or semi-gross lease. The federal [government] typically uses semi-gross [leases], where … a base year of energy consumption [is established by] the [owner] and then [the federal government] pay[s] an index increase, not actual cost. This gives [the federal government] greater predictability over the term of the lease.[185]

According to witnesses, “green leases” represent a potential solution to the agency problem[186] which exists between owners and occupants. As stated by Mr. Seymour, “[b]y adopting [green leases], by being forthright and specific about what you will accept in a building as you negotiate the lease with the owner — such that ‘these are the kinds of conditions we expect to be met’ — you get into energy density [or use] targets.”[187] Witnesses also told the Committee that the federal government should establish certain specifications through “green leases.” For example, Mr. Staszenski stated that the federal government should set standards regarding the energy performance that it expects the owners of the buildings that it leases to achieve. Moreover, he explained that the federal government has the power to demand energy-efficient lighting or water-efficiency measures in order to ensure that its operating costs are reasonable.[188] However, the Committee cautions that green leases, like any legal arrangement, can involve additional costs.

Mr. Karakasis said that having specifications for energy performance in leases is “good business,” and that the federal government should use its “buying power” to ensure building performance that is characterized by energy efficiency. He remarked that the government can say: "here are the standards of performance we want for lighting, air change, … and we want to see that in your offer to us, and if you don't have it, we're going to shop around.”[189] As well, in his view, building owners that have major federal occupants would welcome the opportunity to reduce energy through engagement in targeting high energy performance.[190]

While the decision to pursue a “green lease” for a new building is fairly straight forward, the decision to negotiate a “green lease” for an existing federal building is more complicated; in particular, the question becomes whether to wait until the end of the term of the lease to renegotiate certain energy performance specifications, or to “open” the lease to renegotiate such specifications. Mr. Karakasis told the Committee that, instead of “opening up [a] lease to change terms and conditions within a lease, to create [energy efficiency] targets, … a more fundamental way of doing it is simply upon renewals.”[191] According to an official from PWGSC, at the time of lease renewal, “[they] would look at the energy efficiency of the building to incent the [owner] to implement projects to save himself, or herself and [the federal government] money as well.”[192]

Regarding lease terms and energy efficiency, an official from the province of British Columbia stated that leases in relation to the province’s commercial building portfolio have a term of five years. He added that, “if there’s an energy efficiency opportunity in a lease base, … [that] information is then provided to our lease services department, who consider the information when they’re renegotiating the lease for that space every five years.”[193]

9. Enhancing Efficiencies in New and Existing Buildings

The terms “commissioning” and “recommissioning” refer to a similar idea: ensuring that a building’s integrated systems are operating properly and that energy use in relation to those systems is minimized.[194] Generally, commissioning refers to new buildings, and recommissioning applies to existing buildings. According to Mr. Carpenter, most existing buildings are not performing optimally, and there is an opportunity to improve performance over time. Moreover, in his view, buildings have extremely complicated systems, including HVAC systems, and managers need to ensure that desired levels of energy efficiency exist.[195] According to him, building optimization can be used to “tune up” existing buildings, and there is an abundance of low- or no-cost recommissioning initiatives that can be done to improve the energy efficiency of existing buildings.[196] Some of the Committee’s witnesses noted that ensuring that buildings perform optimally from the perspective of energy use is important. In their view, the energy use of buildings should be benchmarked and managed well, on an ongoing basis, in order to maintain continued optimization of building performance. According to Mr. Mueller, “[t]he evidence would suggest that operational savings of up to 20%, maybe a little more, are possible from recommissioning.”[197]

The Committee was informed that lighting is a particular area that should be addressed in order to achieve higher energy performance. According to Mr. Rogers, lighting represents 20% to 25% of the energy consumption of any building.[198] He said that “[p]roven fluorescent technology called linear T8 and T5 has been effective since 1992, and manufacturers have steadily improved it, making it highly reliable and cost-effective. Despite this, over 70% of older buildings in Canada are fitted with old 1940s T12 lighting technology”.[199] In his view:

If we simply use 100-million square metres of space as a reference for government buildings, including those leased to government, we could think of saving 10 watts per square metre simply by retrofitting the lighting. Those areas would include ones that have already been upgraded with technology replacement. If the lighting operates for a conservative 3,000 hours per year, with an energy value of 10¢ per kilowatt hour, then the value of those savings would be $300 million per year with a net CO₂ reduction of over two million tonnes per year.[200]

An official from the province of British Columbia stated that energy efficiency is not a one-time event; instead, it is ongoing.[201] He also identified the importance of making sure that the systems in place are operating as designed, and of ensuring that those systems continue to be operated optimally,[202] while Mr. Montanino told the Committee that, in Manitoba, the opportunities that are identified through retro-commissioning — or a recommissioning process — would typically be paid back within one or two years.[203]

10. Assessments and Certifications for New and Existing Buildings

As noted in Chapter 2, industry-recognized rating programs — such as LEED or BOMA BESt — are third-party programs designed to assess and — provided specified standards are met — to certify buildings at certain levels based on their energy and environmental performance. According to Mr. Smiciklas, building assessments occur in order to provide a baseline measure of a building’s energy performance, and to identify actions that should be taken in order to improve the sustainability — or energy performance — of the building.[204] He informed the Committee that, in his view, “[s]etting targets for all federal buildings, not just those managed by [PWGSC], first to be assessed, then certified, and then to graduate to the highest level of certification is the very best way that the government can both respect taxpayers’ dollars and demonstrate its environmental leadership.”[205]

Provided the required energy and environmental performance standards are met, certification may occur following an assessment. According to an official from PWGSC, most new federal buildings are being certified under LEED, while existing federal buildings that are certified meet the BOMA BESt rating standards.[206] While Mr. Mueller told the Committee that LEED and BOMA BESt are complementary rating programs, he also remarked that BOMA BESt is a good entry-level system and that LEED EB:O&M is both “more stringent and more demanding.”[207] He noted that while the private sector and the public sector are comparable in their practice of obtaining LEED certifications for new buildings, the private sector is currently ahead of any level of government in Canada in terms of LEED EB:O&M certification for existing buildings; a very small number of existing federal buildings are being certified under the LEED EB:O&M program.[208] Finally, according to him, in spite of the cost of retrofitting buildings to improve energy efficiency, the private sector is motivated by corporate social responsibility, occupant demand for energy-efficient office space and profit in relation to competing for new buildings occupants.

Currently, approximately 153 federal buildings are registered or certified in the LEED program.[209] Regarding newly constructed federal buildings, he argued that the government should continue to maintain its LEED Gold certification requirement for new buildings. He told the Committee that, over the next three to five years, the federal government should consider certifying buildings to a higher standard, such as LEED Platinum. Similarly, Mr. Eickmeier encouraged the government to mandate and achieve high levels of certification for new federal buildings, both Crown-owned and -leased. Regarding the increased use of LEED certification for federal buildings, a PWGSC official commented that “LEED has certainly established itself as a well-known brand in North America, but it is not without cost. It has a very intensive data requirement for what you have to document, what you have to provide for certification in the evaluation process.”[210]

An official from PWGSC highlighted a federal example of LEED certification: the Jean Canfield Building in Charlottetown, Prince Edward Island. This building, which was the first federal building in Atlantic Canada to receive a LEED Gold certification, was designed with a number of features that reduce energy consumption, such as heat recovery from exhaust air, daylight harvesting, a rooftop photovoltaic solar panel, and a direct connection to Charlottetown’s district energy system to avoid installing a heating and cooling plant for the building itself.[211] An official from NRCan spoke about another energy-efficient federal building: a materials technology laboratory owned by NRCan that is located on the McMaster University campus in Hamilton, Ontario. According to him, this laboratory is expected to obtain a LEED Platinum certification due to a number of design features that promote lower energy consumption, as well as a system that stores energy that is not used in warmer months, for use in colder months.[212]

Regarding existing federal buildings, a number of witnesses argued that there is an opportunity for more buildings to be either certified or certified to a higher level. According to Mr. Eickmeier, “[n]ot only will this commitment speak volumes about top-down leadership; it will also have a net-positive effect on energy reductions across the country, given the considerable portfolio buildings within [the federal] inventory.”[213] Mr. Mueller suggested that existing federal buildings should be certified under LEED for Existing Buildings, with recertification every five years.[214] According to Mr. Carpenter, LEED EB:O&M essentially requires buildings to be in the top 30% of energy-performing buildings.[215] Mr. Smiciklas suggested that the federal government should assess all federal buildings using the BOMA BESt rating program, including those for which PWGSC is not the custodian. According to him, the BOMA BESt certification program is the most environmental and cost-effective manner in which the government could achieve its environmental and fiscal goals.[216] He also stated that BOMA Canada is ready to work with federal departments that are not currently using BOMA BESt in order to develop new assessment protocols and new rating system guidance that can be based on the unique needs of certain buildings, such as laboratories, prisons and buildings on military bases. Furthermore, he urged the government to certify its buildings to the highest level of certification, which he said would result in major reductions in energy use and significant savings in operating costs.[217]

11. Monitoring Building Systems and Reporting for New and Existing Buildings

In addition to initial building assessments, as well as certifications and recertifications, monitoring is a step in improving the energy performance of a building. A building’s energy performance can be monitored in a number of ways, including energy audits. According to an official from PWGSC, all Crown-owned and -lease-to-purchase properties are subject to such audits every five years.[218] Similarly, the U.S. Department of Energy’s Federal Energy Management Program (FEMP) requires that covered facilities are evaluated for energy improvements each year. Specifically, at least 25% of facilities covered by the Energy Independence and Security Act of 2007 requirements, need to be audited each year, so that every facility is evaluated once every four years.[219]

Mr. Mueller told the Committee that, in order to ensure continued optimization of the performance of its certified buildings, the federal government would benefit from benchmarking and managing its energy and water use appropriately, on an ongoing basis.[220] According to Mr. Carpenter, measuring and tracking energy use, and comparing actual to forecasted usage, is an effective way in which to assess progress made and to correct problems as they arise.[221] He also advocated the installation of metres to monitor the energy use of specific building components, such as the cooling and heating system, as well as the lights.[222] According to Mr. Love, office buildings located in downtown Toronto that are involved in the voluntary Race to Reduce program, which has the goal to reduce a building’s energy consumption by 10% by the year 2014, use an ENERGY STAR portfolio manager to monitor energy savings.[223]

In the United States, section 103 “Energy Use Measurement and Accountability” of the Energy Policy Act of 2005 requires that by 1 October 2012, all federal buildings be metered for the purposes of efficient energy use and reduction in the cost of electricity used in such buildings. The Act specifies that federal agencies must use advanced meters or metering devices that provide data at least daily, and measure the consumption of electricity at least hourly, to the extent practicable. In addition, the U.S. Energy Independence and Security Act of 2007 requires that energy use data for each metered building is entered into a benchmarking system, such as the ENERGY STAR Portfolio Manager.[224]

An official from NRCan spoke about another tool for monitoring building performance: an automated building monitoring system. He indicated that NRCan has developed a diagnostic tool — DABO, the diagnostic agent for building operations — that diagnoses all of the pre-set conditions of a building’s components with a central control system on a 24/7 cycle. According to him:

[The diagnostic tool] works ahead of time —i.e., saying that something is going out of the zone, and you can adjust now. If you actually get yourself into a problem, it can give you advice on how to fix the problem. Then, after the fact, it can also say, in a retroactive sense, here's what happened, and here's how you can prevent it from happening again.[225]

He added that:

[B]y itself [DABO is] not sufficient. It's a great tool, but as in all cases, using a tool properly is the key. There's a training component associated with the building management itself that links with DABO, and the combination of the two can be very effective. We figure as much as 10% to 20%, depending on the building age, the building condition, etc., can be gained. It costs about a dollar a square foot, with somewhere in the neighbourhood of a three- to five-year payback.[226]

Similarly, according to an official from the Government of Manitoba, the province has direct digital controls — or DDCs — in 146 government buildings.[227] These DDCs manage a number of systems, including heating, ventilation, air conditioning, and such other components as heat pumps, hot water tanks and cooling towers. Through DDCs, building operators have access to systems 24 hours a day. She indicated that “[e]nergy efficiency is one piece of [the working environment], as is water efficiency, but it also has to be a comfortable building that our colleagues want to work in. The DDC system allows us to be adaptive and responsive to that.”[228]

12. Coordination Among Federal Departments

According to a number of the Committee’s witnesses, inadequate coordination between building owners and occupants is a major challenge faced by federal departments that are seeking to improve their energy efficiency.[229] For example, Mr. Love noted that — like tenants and landlords in the residential sector — an “agency problem” sometimes exists at the federal level. In some cases, one department looks after capital expenditures while another department oversees operating costs; these two departments tend to work in silos.[230] As a result, the upfront investment is made by one department, but the other department obtains the cost savings; a lack of coordination between these departments could result in a lower-than-optimal investment in energy efficiency upgrades. Mr. Staszenski suggested that a team — rather than a silo — approach would lead to optimal results.[231]

Mr. Karakasis also identified the delegation of authority regarding the management of federal buildings as a challenge, since this management is divided between two types of people: on one hand, project officers or environmental specialists, who are responsible for collecting data in relation to buildings and for running environmental programs, and — on the other hand — property managers or building operators, who are responsible for the overall management of the buildings and who have the best understanding of how the building operates. He said that property managers or building operators need to be involved in the collection of data, as they often know how to improve the performance of the buildings that they manage. In his view, project officers or environmental specialists could help occupants adopt energy-conscious behaviours, such as making use of existing infrastructure for recycling and adopting practices that lead to reduced energy consumption.[232]

Mr. Love identified the loss of corporate memory as another challenge among federal departments. According to him, employees are highly mobile, and corporate knowledge is sometimes lost in departments, when people move to opportunities elsewhere.[233]

13. Awareness, Education and Training

In order to engage people in taking actions that will improve energy efficiency in federal buildings, they must be aware of the targets that have been set in this regard. Mr. Eickmeier commented that the FSDS and energy efficiency targets must be publicized so that the public, relevant stakeholders and employees are aware of the desired objectives.[234] In an effort to help building occupants change their behaviour, Mr. Staszenski supported the creation of incentives, as well as awareness and savings programs; with the latter, occupants would receive a portion of the savings resulting from their energy-conscious behaviours, with these savings used for building improvements.[235] While Mr. Karakasis agreed with these savings programs, he spoke about the need for a more coordinated effort between the private and the public sectors in engaging occupants in the energy efficiency process, and in helping them to understand that they are part of the effort to reduce energy use and waste.[236]

Mr. Eickmeier mentioned that changing the behaviour of occupants — who are key partners in energy efficiency initiatives — could generate significant savings.[237] However, Mr. Mueller highlighted that changing human habits could be a significant challenge.[238] Mr. Karakasis suggested that consultations with occupants about the energy efficiency process and about how to reduce energy consumption could help to overcome the challenges associated with changing human behaviour.[239] Mr. Love shared his view that engaging the organization as a whole in a specific project, and implementing a process whereby occupants can participate, could help to improve energy efficiency in office buildings.[240]

Witnesses identified training and education for employees and occupants as a critical element in achieving higher levels of energy efficiency, as training and education allow individuals to understand the opportunities, the objectives and the manner in which building performance could be improved; according to them, the result could be significant savings. In the view of a PWGSC official , employees are very interested in contributing to energy efficiency measures, as they are interested in preserving the environment; to this end, PWGSC is developing targets that would further engage employees in adopting energy-conscious behaviours.[241] Mr. Rogers suggested that the federal government should develop a simple education program to identify possible actions that could be taken to improve energy consumption; the program could be presented to every federal department and office building.[242]

According to witnesses, it is important to provide property and facility managers who oversee the federal real estate portfolio with adequate training. While Mr. Karakasis stated that these individuals need to have access to continuing education in order to help them learn and implement best practices in relation to building management, Mr. Staszenski stressed that these individuals must be provided with the tools and resources needed to operate the buildings they manage effectively; these tools and resources include training and appropriate funds to implement required energy efficiency upgrades.[243]

An official from PWGSC said that training is sometimes embedded within the established targets or options, as a way of achieving a given goal.[244] She commented that, in general, PWGSC “[has] to create high-level objectives and then allow departments and deputy heads to exercise their own authority and judgement in terms of how best to get to that target.”[245] An official from NRCan said that her department offers training on energy management, including Dollars to $ense Energy Management Workshops[246] that offer energy-saving tips, as well as information on such topics as energy management information systems, recommissioning, planning energy management, identifying opportunities to save energy, monitoring energy use and financing energy efficiency measures.[247] According to an official from NRCan, since the establishment of the department’s energy management training program in 1997, 25,000 people have participated, including approximately 2,000 federal employees; estimated savings across Canada have been predicted to be at least $175 million.[248] Another official from NRCan told the Committee that her department also offers training for private- and public-sector building occupants to help organizations use and waste less energy.[249]

An international example of a government energy management program was provided to the Committee by the U.S. Department of Energy. The U.S. FEMP includes training and other promotional material directed to federal agencies’ public servants. These materials include the FEMP Focus newsletter, extensive online and in-person training, and the annual GovEnergy workshop. As well, the FEMP has recognition programs.[250]

Mr. Karakasis spoke about training provided by the building sector, and indicated that BOMA Ottawa has a variety of documents that outline industry standards; it also offers programs and forums to share best practices and experiences regarding building management and energy savings.[251]

B. Committee Observations and Recommendations

With respect to leadership through targets, policies and processes, the Committee recommends that:

RECOMMENDATION 1:

The federal government continue to ensure that programs under the Federal Sustainable Development Strategy or real property policies in relation to environmental impacts are stringent and rigorous.

RECOMMENDATION 2:

The federal government develop energy efficiency data-collection tools and indicators to monitor energy use in federal buildings. Such tools and indicators can include:

• energy targets based on kilowatt hours in new and existing federal buildings; and
• labelling buildings according to their energy performance.

Further, in order to identify and address buildings that require improvement, the government should create a database in order to compare the energy use of federal buildings, based on building age, size and location.

RECOMMENDATION 3:

The federal government establish a policy requiring departments to consult with the Natural Resources Canada’s Federal Building Initiative prior to planning a building renovation that would involve costs that exceed a specified value.

With respect to building and energy codes, the Committee recommends that:

RECOMMENDATION 4:

Where appropriate and within existing budgets, the federal government work with the private sector to develop standards in relation to building construction, as well as operation and maintenance, for non-office space buildings, such as laboratories.

RECOMMENDATION 5:

Within existing budgets and using measures such as cost-benefit analysis where appropriate, Natural Resources Canada work in cooperation with the provinces and territories with the objective of furthering the energy-efficiency provisions of the National Building Code.

With respect to strategic plans for building management, the Committee recommends that:

RECOMMENDATION 6:

Prior to undertaking energy retrofits, departments develop strategic plans for energy-efficiency measures. Consideration should be given to energy savings, capital costs over the long term, and global impacts of specified upgrades.

RECOMMENDATION 7:

The federal government formulate and update its strategy and action plan for improving energy efficiency based on an analysis of energy used. The analysis could include consideration of the “audit-implementation-monitor” approach, markets, technologies and efficiency opportunities.

RECOMMENDATION 8:

After a cost-benefit analysis, actions be taken to deliver cost-effective energy savings. Furthermore, facility managers who oversee the federal real estate portfolio should report on their efforts in relation to these savings.

With respect to energy performance contracting for new and existing buildings, the Committee recommends that:

RECOMMENDATION 9:

Prior to entering into performance agreements for energy-efficiency retrofits, an evaluation of the administrative overhead costs and/or premiums, and consideration of alternative strategies, be undertaken in order to ensure the project is cost-effective and provides value for money.

RECOMMENDATION 10:

The federal government, through the Federal Building Initiative for retrofitting federal buildings, encourage private investment in federal buildings in support of energy-efficiency capacity building.

With respect to enhancing efficiencies in new and existing buildings, the Committee recommends that:

RECOMMENDATION 11:

The federal government aim to improve the energy efficiency of existing federal buildings through cost-effective reductions in energy consumption.

RECOMMENDATION 12:

The energy performance of federal building components and systems be improved in order to support the federal government’s economic goals.

With respect to assessments and certifications for new and existing buildings, the Committee recommends that:

RECOMMENDATION 13:

In order to promote energy efficiency and energy management, the federal government – where appropriate – encourage the assessment of existing buildings under the most appropriate certification and ensure that all newly constructed federal buildings meet the minimal operational requirements.

With respect to monitoring building systems and reporting for new and existing buildings, the Committee recommends that:

RECOMMENDATION 14:

The energy use of federal buildings be tracked to provide building managers or custodial departments with information on energy performance. This tracking should occur with the express purpose of furthering in-house best practices.

With respect to awareness, education and training, the Committee recommends that:

RECOMMENDATION 15:

Within existing budgets, federal departments, agencies and Crown corporations enhance awareness and capacity for improved energy efficiency.