Proposed Change 2004

Approximately 13% of Canada's total greenhouse gas (GHG) emissions can be attributed to houses and buildings. This is primarily a result of using fossil fuels for space and water heating. Additionally, the combined impact of electricity consumption for cooling, lighting and running other appliances raises the overall contribution of buildings to GHG emissions to approximately 18%.^[1] The 2020 GHG emissions from residential and building sectors are outlined in Table 1, which shows the sources and their percentage of electricity consumption.

Note to Table 1:

(1) https://oee.nrcan.gc.ca/corporate/statistics/neud/dpa/menus/trends/comprehensive_tables/list.cfm

There has been a growing recognition of the importance of addressing climate change and reducing GHG emissions from all sectors, including the built environment. However, the National Model Codes (the Codes) do not presently consider the type or quality of energy sources used by buildings and houses, nor do they address or regulate embodied and operational GHG emissions. As the industry moves towards higher energy efficiencies, the differences between energy sources must be examined because they contribute to GHG emissions differently. Historically, the Codes focused on design and construction requirements related to safety, structural integrity, accessibility and energy efficiency. With the latter, the emphasis was on reducing energy consumption during the construction and operational phases, but did not explicitly address operational GHG emissions. Furthermore, Canada is a large and diverse country with different climatic regions and building practices. This reality has led to regional variations in building codes and regulations, making it challenging to establish a unified approach to address operational GHG emissions at the national level.

The Codes currently contain an energy-efficiency objective and related requirements for the design and construction of new buildings and houses. In the 2020 editions of the National Energy Code of Canada for Buildings (NECB) and National Building Code of Canada (NBC), energy-efficiency tiers were introduced, containing measures that progressively increase energy efficiency and reduce the amount of energy needed to operate a building. These requirements play a crucial role in reducing GHG emissions by focusing on the amount of energy used. However, the Canadian Board for Harmonized Construction Codes (CBHCC) recognizes that energy savings alone will not lead to reducing emissions to meet the national goals stated in the Pan-Canadian Framework.

GHG emissions across Canadian provinces and territories exhibit substantial variations, influenced by factors such as population density, climate, energy sources and economic considerations.^[2] Provinces and territories with larger populations, resource-based economies or heavy reliance on fossil fuels for electricity generation generally register higher emissions levels. This demonstrates a greatly varied energy landscape across Canada.

Ultimately, the goal is to reduce operational GHG emissions to zero or near zero across provinces and territories by 2050. Consequently, authorities having jurisdiction require a flexible framework to regulate GHG emissions due to building operation by using "levels" that move towards lower operational GHG emissions.

References

[1] https://www.canada.ca/en/services/environment/weather/climatechange/climate-plan/climate-plan-overview/healthy-environment-healthy-economy/annex-homes-buildings.html

[2] https://www.canada.ca/en/environment-climate-change/services/environmental-indicators/greenhouse-gas-emissions.html

Since 2010, the NBC and NECB have included requirements to prevent excessive use of energy. Though these requirements have improved the energy efficiency of new houses and buildings, the Codes remain silent on the type of energy used and the emissions associated with production, distribution and use. As a result, many new Code-compliant buildings contribute GHG emissions through their year-over-year operation. Reducing these emissions is an important step to enable action towards climate goals. Climate change is the biggest challenge facing humanity today, consequently, it is vital that the Codes address this gap to support Canada in reaching its emissions reduction target of 40% below 2005 levels by 2030 and net-zero emissions by 2050. Furthermore, achieving long-term climate goals requires early action on operational GHG emissions. Failure to address this pivotal issue could impede Canada's progress towards its emissions-reduction targets, jeopardizing the ability to effectively combat climate change and protect the future well-being of the country. The commitment to a sustainable future demands that these emissions be addressed comprehensively and urgently.

If these emissions are to be regulated, designers, builders and enforcement officials need a consistent and accurate means to convert expected energy use into expected GHG emissions. For years, governments and industry have relied on emissions factors (also referred to as emissions intensity factors) for this task. Emissions factors describe the amount of GHG emissions (in kg CO­₂ equivalent) per unit of energy consumed, for instance, of electricity (in kWh), of natural gas (in m³), and of heating oil (in L). Environment and Climate Change Canada compiles this data annually and publishes estimates as part of Canada’s national greenhouse gas inventory report. Emissions factors reflect the carbon intensity of different fuels, as well as regional differences in energy production and distribution. Data is generally published after two years; factors reflecting 2021 data were published in April 2023.

If Canada’s energy sector were unchanging, this data would suffice for building design and Code-administration purposes. But provincial, territorial and regional utilities are presently undergoing unprecedented transition. Electric utilities are shifting away from coal power generation, while gas utilities are experimenting with new technologies to lower emissions through use of hydrogen and renewable biogas sources. These changes are expected to occur rapidly; some provincial utilities expect to reduce electric emissions by 60% or more by 2030. In this environment, referencing the most recent (2021) emissions data currently available in the Codes could encourage the construction of buildings with higher-than-expected emissions. For this reason, this proposed change is based on the best available future-looking forecasts for utility emissions, averaged for the years 2031 to 2035. Emissions factor forecasts for electricity are sourced from Environment and Climate Change Canada’s most recent (2023) projections. While no similar projections are currently available for natural gas utilities, such projections are expected in future years and could be incorporated into the Codes at a later date.

This section describes the approach that was adopted for performing an impact analysis of the proposed tiered operational GHG emissions requirements for the NBC. The impact analysis was done in accordance with the methodologies in this proposed change to introduce operational GHG emissions requirements into the Codes. The impact analysis was performed using simulated scenarios. Specifically, the simulation results that were used in this impact analysis correspond to cases that use the reference equivalent carbon intensity factor values of 235 g CO₂e/kWh and 260 g CO₂e/kWh for determining the GHG emissions target for space heating and for service water heating, respectively. The GHG emissions of all non-heating regulated loads were calculated taking into account the emissions factor of electricity for each province and territory (2031-2035 values).

Table 1 shows the percentage of natural-gas-heated archetypes that comply with the different GHG emissions performance levels. All the cases presented in the tables correspond to buildings that meet the minimum requirements established in the NBC. In addition to the NBC requirements, it was assumed that all archetypes have a heat recovery ventilator. Since the scenario with natural gas as the main energy source is considered as the base case, no incremental costs are associated with that scenario. As Table 1 illustrates, most natural gas heated buildings will reach Level E (i.e., percent improvement ≥ 10%) and Level F (i.e., percent improvement ≥ 0%) without any incremental costs. In most locations, the percentage of buildings that can reach Level F is higher than the percentage of buildings that can reach Level E. There are a small number of natural-gas-heated houses that will not comply with the GHG emissions requirements in different locations. In the majority of cases, the non-compliant houses are small, with floor areas that are less than 100 m². The exception is British Columbia, where more than 50% of the houses are not meeting the target emissions. This is likely due to service water heating being the dominant load in most cases. The efficiency of the service water heating system taken into account when calculating the reference equivalent carbon intensity factors is higher than the minimum efficiency required by the NBC.

Table 2 presents the percentage of archetypes that comply with the different GHG emissions performance levels using natural gas for space heating and electricity for service water heating. As Table 2 illustrates, for provinces with low and mid GHG emissions intensities, most houses will achieve Level D (i.e., percent improvement ≥ 25%) and for provinces with high GHG emissions intensities, most houses will achieve Level E (i.e., percent improvement ≥ 10%). The exception is Nunavut, which has an emissions factor for electricity that is significantly higher than the one for natural gas. This proposed change has specific provisions for such cases.

Table 3 presents the percentage of archetypes that comply with the different GHG emissions performance levels using electricity for both space and service water heating. As Table 3 illustrates, for provinces with low GHG emissions intensities, houses are able to achieve Level A (i.e., percent improvement ≥ 90%); for provinces with mid GHG emissions intensities, houses are able to achieve Levels B (i.e., percent improvement ≥ 75%) or C (i.e., percent improvement ≥ 50%); and for provinces with high GHG emissions intensities, houses are able to achieve Levels D (i.e., percent improvement ≥ 25%) or E (i.e., percent improvement ≥ 10%). As in the previous case, the exception is Nunavut.

Table 4 presents the percentage of archetypes that comply with the different GHG emissions performance levels using electric air source heat pumps for space heating and electric heat pump water heaters for service water heating. As Table 4 illustrates, for provinces with low GHG emissions intensities, all houses are able to achieve Level A (i.e., percent improvement ≥ 90%); for provinces with mid GHG emissions intensities, houses are able to achieve Levels A (i.e., percent improvement ≥ 90%) or B (i.e., percent improvement ≥ 75%); and for provinces with high GHG emissions intensities, houses are able to achieve Levels C (i.e., percent improvement ≥ 50%) or D (i.e., percent improvement ≥ 25%). As in the previous case, the exception is Nunavut.

Finally, Table 5 presents the percentage of archetypes that comply with the different GHG emissions performance levels using cold climate electric air source heat pumps for space heating and electric heat pump water heaters for service water heating. As Table 5 illustrates, for provinces with low GHG emissions intensities, all houses are able to achieve Level A (i.e., percent improvement ≥ 90%); for provinces with mid GHG emissions intensities, houses are able to achieve Levels A (i.e., percent improvement ≥ 90%) or B (i.e., percent improvement ≥ 75%); and for provinces with high GHG emissions intensities, houses are able to achieve Levels C (i.e., percent improvement ≥ 50%) or D (i.e., percent improvement ≥ 25%). As in the previous case, the exception is Nunavut.

From the results presented in Tables 1 to 5, where natural gas or electricity is the primary source of energy, it is evident that the majority of NBC-compliant buildings can achieve different operational GHG emissions performance levels without any additional cost. As Tables 2 illustrates, for British Columbia, replacing the natural gas service water heating system with an electric one results in all archetypes meeting the GHG emissions target.

According to Tables 1 to 5, different operational GHG emissions performance levels can be achieved depending on the primary heating source and the GHG emissions intensity level (low, mid or high) to which they are connected. Buildings implementing measures above the minimum requirements of the NBC will have an incremental cost associated with the specific measure that is implemented.

Table 6 presents the average cost of space and service water heating equipment having a higher performance than the minimum requirements of the NBC. However, since the cost associated with reaching a specific GHG emissions performance level cannot be generalized to all provinces and territories, the incremental cost must be evaluated individually on a case-by-case basis.

Notes to Table:

(1)  The cost takes into account the equipment, materials and installation; the cost of the heating equipment is based on the sizing for an average house (floor area approximately 200 m²); the cost of the service water heating is based on the load for a four-member family; the cost does not take into account the variability between provinces and territories and the cost for some locations—especially arctic locations—may be higher.

(2)   Home Depot (www.homedepot.ca/en/home/ideas-how-to/heating-and-cooling/cost-install-gas-furnace.html)

(3)   HomeAdvisor (www.homeadvisor.com/cost/heating-and-cooling/install-an-electric-baseboard-or-wall-heater/)

(4)   Modernize Home Services (www.modernize.com/hvac/heating-repair-installation/furnace/electric)

(5)   HVAC Trust (www.hvactrust.ca/)

(6)   1Click Heating&Cooling (www.1clickheat.com/)

(7)   Enercare (www.enercare.ca/water/water-heating/buyers-guide-to-water-heaters)

(8)   Home Depot (www.homedepot.ca/en/home/categories/building-materials/plumbing/water-heaters/tank-water-heaters/tank-electric-water-heaters.html)

Taking into account the costs presented in Table 6, an incremental cost was calculated for each of the previously presented scenarios. It was assumed that when the energy source is either natural gas or electricity, the incremental cost is zero. Table 7 presents the incremental costs for all scenarios. 

As previously mentioned, there are no additional costs associated with scenarios 1 and scenario 2 because the proposed house will have mechanical equipment that is compliant with the NBC. Scenario 3 was considered to have no incremental cost either because it includes a combination of natural gas space heating system and electric service water heating system, both of which are compliant with the NBC. Scenario 4 and scenario 5 assume the adoption of energy conservation measures to achieve energy tiers above tier 1, and they have an incremental cost associated with them as presented in Table 7.

Each scenario, if implemented, will result in a decrease in the annual amount of operational GHG emissions. For example, implementing scenario 1 in Alberta (a province with a high GHG emissions intensity) will result in 24% of the house archetypes (out of 240) achieving Level E (i.e., percent improvement ≥ 10%) and 73% of the house archetypes achieving Level F (i.e., percent improvement ≥ 0%). If the natural gas service water heating system is replaced with an electric one (scenario 2) or both natural gas systems are replaced with electric ones (scenario 3), then 100% of the house archetypes will achieve Level E (i.e., percent improvement ≥ 10%). The implementation of scenario 4 (air source heat pumps) will result in 100% of the house archetypes achieving Level D (i.e., percent improvement ≥ 25%), while the implementation of scenario 5 (cold climate air source heat pumps) will result in 100% of the house archetypes achieving Level C (i.e., percent improvement ≥ 50%).

Building envelope measures that are above the minimum energy performance of tier 1 result in energy conservation points that allow the NBC user to obtain credit for the energy savings associated with the building envelope measures that were adopted. The energy savings associated with the building envelope measures will result in a reduction of operational GHG emissions of the house as well, allowing the NBC user to achieve higher operational GHG emissions levels.

Estimations of the costs associated with envelope improvement are presented below. RSMeans data for residential costs was used to estimate the incremental costs associated with improvement of exterior walls insulation. A range of estimated values was calculated to account for the variability between the provinces and territories (location factors provided by RSMeans).

Notes to Table:

• Source: RSMeans 2023 – Residential costs;
• Insulation type: non-rigid insulation (batts), fiberglass, kraft faced.

As Table 8 illustrates, the energy savings and the incremental costs increase with an increase in the effective RSI value of the exterior wall. According to the NBC, no-cost measures such as a decrease in the volume of the house can result in energy saving points of between 1 and 10, depending on the volume reduction.

The NBC provides energy conservation measures for fenestration as well. Table 9 presents the costs associated with the performance improvement of windows.

As Table 9 illustrates, the incremental costs associated with the performance improvement of windows increase with decreasing U values (or increasing RSI values) of the window. The percentage energy savings depends on the U value of the window and climate zone.

Applying energy conservation measures to achieve higher energy tiers than tier 1 will result in the achievement of higher operational GHG emissions levels as well. However, depending on the energy conservation measures, these will have an incremental cost compared with the minimum requirements of the NBC for energy tier 1.

The enforcement of the proposed technical requirements to minimize the excessive emission of operational GHG emissions would require additional effort by authorities having jurisdiction.

A consistent set of technical requirements to minimize the excessive emission of operational greenhouse gases across Canada would contribute to meeting provincial, territorial and federal reduction targets and climate action plans, including Canada’s goal to reduce its total GHG emissions to 40% to 45% below 2005 levels by 2030 and to reach net-zero GHG emissions by 2050.

Designers, engineers, architects, builders and building officials.