Cost of adding undue energy conservation measures reach tipping point: RESCON

Vaughan, Ont., March 27, 2024 (GLOBE NEWSWIRE) — A year-long case study found that the added benefits associated with increasing energy-efficiency measures do not always justify the added costs for new home buyers. 

“Through regulatory mandates, there is a move to fully electrify all new buildings and homes to meet net-zero targets in order to combat climate change,” says RESCON president Richard Lyall. “However, evidence from this demonstration project indicates there are concerns as energy savings that result from these moves are limited and don’t always justify the additional construction price tag for consumers, such as spending over $50,000 to save a homeowner $600 per year on their utilities.

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“The findings of this study are important because the residential construction industry is facing a perfect storm of issues, and we are in an unprecedented housing crisis. As codes and standards are updated, we should not be adding more costs to housing without due consideration as to whether they really make sense, especially considering the looming electricity supply crunch to Ontario’s grid.”

Christian Rinomato, director of sustainability with Country Homes, builder of the homes in the study, said, “We will continue to strive for a better-performing home, both from an environmental perspective, but also an economic perspective. We are in the midst of an affordability crisis and, as a builder, it is our responsibility to build better homes that perform efficiently and are affordable to operate.”

The study prepared for the Residential Construction Council of Ontario (RESCON), titled the Super Semi Energy Efficiency Demonstration Project, corroborates a similar case study presented by NRCan in 2023. Analytical comparison methods were used to quantify, verify, and compare data on the real-world performance of occupied homes against their annual energy-use simulation computer models. The nearly identical homes were two halves of a semi-detached house, allowing the builder to explore practices in advancing energy efficiency beyond code while evaluating real-life operating costs. One half of the semi was all-electric designed to achieve net-zero energy; the other was a low-carbon home that allowed fuel-switching with an electric heat pump and natural gas-combination hybrid heating system. 

Findings showed discrepancies between annual energy use simulation software and the homes’ actual performance, consuming more energy than predicted. The study also found that moving too far beyond the current building code requirements for energy-efficiency measures can result in a negative return on investment.

Since major policy decisions such as changes to building codes are based on assumptions derived from software models, there is growing concern that Canada’s climate strategy with respect to homes and buildings may be misguided.

Given the ongoing housing affordability crisis, the limited energy savings homeowners realize from added conservation measures do not always justify the incremental construction costs imposed on new housing. This study showcases the discrepancy between computer models and real-world performance and highlights the need for more thorough and ongoing analysis.

“Through our current provincial building code, new home builders are already leaders and a decade ahead of other provinces when it comes to energy-efficient practices,” says Lyall. “Developers, builders and consumers are facing crippling taxes, fees and development charges that add as much as 31 per cent to the cost of a new home. Any steps to impose drastic energy-efficiency measures without a full cost-benefit analysis are a recipe for disaster.”

Rinomato observed, “From the builder’s perspective, we feel hand-tied when programs are forced upon us. We are currently striving for 20 per cent better than the building code and believe it should be up to us on how we get there.”

Click here to read the study.

RESCON is the province’s leading association of residential builders committed to providing leadership and fostering innovation in the industry.


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