Why Less is More for Canada (Part 1)
What is at the heart of energy efficiency and what are the benefits? Is less really more? And why is it so important that nations and governments implement policy to take action not only for their economies, but for the planet? To help us demystify this topic, Corey Diamond, Executive Director of Efficiency Canada, and the national voice for an energy efficient economy, joins us to share his insights. The short answer: energy efficiency really means so much more! Tune in to get the scoop.
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Dan Seguin 00:02
Hey, everyone, welcome to this very special episode of the ThinkEnergy podcast. Energy efficiency is a large sweeping topic that has different implications and meanings depending on if you are a nation, a federal, provincial or municipal government, an industry, a business owner, or simply a homeowner. On today's show, part one, in our discussion about energy efficiency, we're going to talk about what energy efficiency means on a global scale and on a nationwide scale here in Canada, because that's where the topic of energy efficiency has been elevated to. Back in 2015, the United Nations set out an ambitious 15 year plan to address some of the most pressing issues facing the world by developing 17 Sustainable Development Goals. One of these goals, 'affordable and clean energy' offers solid technical guidelines and solutions so that governments can achieve energy efficiency nationally, and work together to achieve it internationally. So what does that mean for Canada? Where does energy efficiency fit into eliminating energy waste, reducing greenhouse gases and the fight against climate change? We're going to find out. So here's today's big question: What are the benefits of energy efficiency? And why is it so important that nations and governments implement policy to take action not only for their economies, but for the planet? To help demystify this for us, Corey Diamond, Executive Director of Efficiency Canada, the National voice for the energy efficient economy, is here with me today. So Corey, you work with Efficiency Canada, whose advocacy work is focused on making our country a global leader in energy efficiency? Let's start by defining energy efficiency in general, and what are the important things your organization advocates for?
Corey Diamond 03:01
Well, thanks for that, Dan, appreciate the 'back to basics' question. Because, you know, oftentimes, in our world, we just dive right into the erudite world and use as many acronyms and things like that. So why don't we start, you know, at the foundation, and if you think about energy efficiency, I mean, the main thing you're thinking about or talking about is, is using less energy to achieve the same or even better outcomes. And, you know, we want we like to think of it as you know, we want things like, we want to be warm, and we want light, and we want mobility, and we want to be productive, and we want to watch Netflix, without, you know, a breeze coming across our ankles, we want all these things. And it doesn't really make any sense to kind of pay, you know, extra for it or to harness us with, you know, the economic or environmental costs of wasting energy. So if you think about energy efficiency, think of it in the terms of how do we make our lives more comfortable? How do we make them more healthier? How do we make buildings more durable? How do we make our economy more productive? Just by using less? And then you asked about what are the things that we advocate for really, you know, we kind of boil it down to three things. And we think of it as kind of like an end state. So if we woke up at a certain date, and out of hibernation, and we said, oh, wow, look at the world, it did all this amazing stuff. What we'd want to see is we'd want to see zero carbon buildings and facilities, we'd want to see a netzero productive economy in Canada. And we want to see meaningful careers, you know, purposeful, meaningful careers for people. So those are the three major kind of impact areas we're working towards. And we see energy efficiency in the policies and investments related to energy efficiencies as the way of us getting there.
Dan Seguin 04:51
In the intro for the show, I talk about the United Nations Sustainable Development Goals. What are some of the evidence base Best practices that the UN recommends the government should follow in. Do you feel that these standards have started a long overdue global conversation?
Corey Diamond 05:11
I would say that as far as an overdue conversation, yes, certainly things have been amped up. But people have been talking about this for decades. And it has been fairly central to, you know, you know, humanity on earth in trying to tackle with emissions reductions since the Rio summit in 92. You know, we look at the International Energy Agency, or the IEA is kind of the most definitive kind of global organization that is, you know, working in this space. And they spend a lot of time particularly since COVID started, on really trying to kind of think about clean energy, energy efficiency, and how will help with with the world's economic recovery, the thing that they look at is they say, Okay, if we're going to reach this, like Paris commitment that the world's governments have come together on, how do we do that, and they looked at and said, Look, 40% of the global climate commitments are going to come from energy efficiency. So it's a significant amount. And I would suspect that many agencies in the UN are also trying to figure that out in the context of the Sustainable Development Goals. So that means looking at buildings, it means looking at transportation, it means looking at industry. And it really means taking that long overdue conversation and going a lot deeper than the way we've done it before. And I think we're starting to see a bit of a sea change. We're at a very pivotal moment in the world right now, where I wish somebody I mean, I'm sure someone has an online, but it'd be so interesting just to get a tracking list of the governments and the corporations who have committed to a netzero future, and then kind of work backwards from that and see, okay, how do we unleash this massive potential energy efficiency to help us get there?
Dan Seguin 06:55
Corey? Can you help me better understand how Canada can grow its economy while reducing emissions, and building resilience to adapt to a changing climate? Do you have examples of other countries, like Australia, that are proving why energy efficiency plays a big part in their economy?
Corey Diamond 07:18
So certainly, there's an economic benefit when you just eliminate waste, right? It's common sense. My daughter's in grade six and I'm sure she's been learning that since kindergarten, right? You know, why? Why are we wasting, you know, there's no benefits from that. And so when we think about energy efficiency, the first thing sort of economic benefit we can think of are the direct jobs. So when the retrofit economy, people coming in retrofitting buildings, or making industrial facilities more efficient, it's a lot of people to do that work, you get a lot of labor involved in order to make that happen, there's no other way to do it. So what ends up happening is that that work is almost overwhelmingly local, you've got local contractors, local suppliers, and these are people in every community across the country who can do that work. So with the right policies and investment and direction, then you start to unleash that kind of job creation, you know, type of thing. So then you look at, okay, not only the direct jobs, but let's look at what happens indirectly, you know, when we save, so naturally, when we save the money, then re circulates back into the economy to do other things, and more productive things, not just spending it on waste. I like to think of it as you know, there's a restaurant at the top of my street. And let's say they, they undertook a, you know, an energy audit, and then did a whole bunch of energy retrofits. So the first thing they did is they hired a whole bunch of people, those people, you know, got jobs and got work and got to do the work. And then this restaurant thought, huh, look at that, we've cut our energy bill by 50%. Why don't we reinvest that into building a brand new patio, and all of a sudden, they built a new patio where they can put more tables, they had to hire two more servers, and they're recycling all that savings back into the economy for productive things. So you get the job creation of the headset, you get the job creation throughout, and you start seeing people do that. You asked about, you know, kind of where else in the world is this happening? There was a study that came out by the American Council for an Energy Efficient Economy, the AC Triple E. They do it every two years. The last one was done in 2018. And they actually rank they do a global ranking of all the countries in the world and who's doing the best. and Canada came in 10th and actually tied with the US. And you know, there's some really good insight in there as to which countries are doing great on certain types of things. Certainly in Europe, you're seeing a lot of activity, and you're not not just historically in Europe. Have you seen it? I think Italy was ranked number one with Germany, they've done a lot of work for many, many decades on this. But what you're starting to see now is the European Union really kind of baking in energy efficiency as part of their economic recovery. And they called the Green New Deal. And they're really trying to kind of relaunch the European economy in this way. And one of the things they did is, I love the marketing and the names they use and things like that. They called it the renovation wave. And there's, you know, there's 32 member states in the EU. And they basically, you know, have a plan to double energy efficiency and building retrofits over the next 10 years. And they're going to create hundreds of 1000s of jobs, and they're going to lower people's energy bills, and they're going to put people back to work. And, you know, they're just doing it and, you know, it comes with a strategy, and it comes with the mandates for the states, and most importantly, comes with money. So they're really kind of, you know, locking it down and saying this going to be a core part of our recovery. So we get a lot of inspiration from our friends and colleagues in Europe, who are, you know, pushing ahead in this way, and starting to see that kind of unlocked here as well,
Dan Seguin 11:07
Is energy efficiency making significant contributions to economic growth in job creation in Canada, into the productivity and competitiveness of Canadian industries?
Corey Diamond 11:19
You know, one of the things we lack, I think this goes for everything in the clean energy space is it's tough to get data, but we do have some data, and it's very encouraging. Our friends at Eco-Canada in Alberta, they came up with a study a couple years ago, and they counted it, they counted up the numbers of people who work in the Energy Efficiency sector, and it's over 436,000 people in Canada. And that's over 51,000, organizations, companies, businesses, things like that, you know, that's more than the telecommunications and the oil and gas sector combined. So there's a lot of people doing this work already. It's overwhelmingly small businesses, independence type, folks. And you're starting to see more of that, you know, some analysis we did we kind of looked at, okay, well, that's the current status, what if we actually enacted and implemented all of the policies that are on the federal government's books, and we saw that we would, we would generate 118,000 annual jobs a year just from doing the things that are in those policies. So again, it backs up that kind of theory we've been having around that local job creation and things. On the industrial side, it's harder to get a number, not a lot of this is tracked. But we do know that, anecdotally that we're starting to see, you know, industries using more energy management systems incorporating this, one of the challenges on the industrial side is, is you're competing for capital projects, or you're competing internally for like, you know, hey, we could like change this system out, that system out, we can do energy efficiency, we can do all these types of things. So you see a bit of a challenge there. But one last economic data point that we just found that actually, which is really encouraging is that not only are we, you know, employing a lot of people, and there's a lot of activity in Canada, but we're also exporting a lot. In fact, the second biggest clean tech export, Canada's clean tech export is energy efficient equipment services. So that's really cool to see too, because there's a huge opportunity of a world market going in this direction. I you know, I just mentioned Europe, is there an opportunity for Canadian companies to take their knowledge, their technologies, their know how, and export that and grow economies around the world as well?
Dan Seguin 13:48
I'm very interested in your thoughts as it relates to the updated federal climate plan, and how you think it will advance energy efficiency?
Corey Diamond 13:58
Well, I am really glad you asked that question. Because my colleague, Brendan Haley, our policy director, he actually wrote a blog called 16 ways the new climate plan advances energy efficiency. So I'm not gonna go through all 16 because then, you know, this will be a very long podcast, but I want to highlight a few things and really three things. So number one, the first thing we see is a major priority placed or an emphasis placed on energy efficiency in the climate plan. The first section, if you go to the plan, the first section is called cutting energy waste. So this is in line with, you know, what I was saying earlier around the value and the benefits that flow when we just get rid of waste first. So that was really cool from a theoretical standpoint, and from a priority standpoint that the federal government is seeing this as a big opportunity. The second thing we see is that there's money. Last year, the federal government announced $6.1 billion for Energy efficiency programs. These are things for home retrofits for financing for commercial energy efficiency upgrades, and for a brand new program around municipal buildings and in the community, so we're starting to see some, some major dollars. And if you put that into context, we look at how each province does every year and energy efficiency, and we kind of, you know, added it up last year, the provinces combined spend $1.2 billion on energy efficiency. So, you know, adding $6 billion into the system is a big step. So, we saw that in the climate plan. And the third thing is, we saw mentioned and sort of a doubling down on some supporting or enabling policies, specifically around building codes. And this is something that we're tracking very closely advocating for, and making sure that any new building that's being built today is built at the highest standard, using the least amount of energy. And so it was really good to see that, you know, obviously, money is good, and priorities are good and investments, great, but just, you know, sometimes it's a, it's a policy, you know, turn of the pen, that actually gets us to where we want to be. But, you know, as an advocate for energy efficiency, I would be remiss not to also outline what's missing. So give me a chance. One thing we're, you know, really, you know, pushing for is a program for low income Canadians. And, you know, this is all the more important because of the situation today, as many people find that they're spending an overwhelming amount of their income on energy. And there's a huge opportunity to support low to moderate income Canadians with a program. So we're really pushing hard for the federal government to do that. And this is especially important because the carbon price is, you know, intended to rise considerably between now and 2030. So, again, that will create more of a burden for those that are finding it already hard to pay for energy bills, we look at it as kind of an energy justice view. And, and we're really, you know, looking for that to be included as part of a beefed up plan by the federal government.
Dan Seguin 17:17
Canada faces the threat of a recession due to multiple shocks spurred by the pandemic, since it's a given that the government will need to lead the economic recovery with sustainable investments, many world leaders are calling for economic recovery plans that pave the way to a zero carbon economy. How can energy efficiency help Canada recover from COVID-19? And how can it lead this economic recovery?
Corey Diamond 17:49
Yeah, it's a really good question. In fact, you know, starting last March, when, you know, when the world turned upside down, we kind of, you know, we're a small shop, we're 8 people and we, you know, we got together, you know, online, and we're starting to figure out, Okay, what what can we do? And how do we essentially pivot or work towards ensuring that the economic recovery has energy efficiency baked into it? So we did some work on that and we also supported a group of economists and policymakers, you know, a nonpartisan group from across the country called the Task Force for Resilient Recovery. And we helped them shape the energy efficiency recommendations for Canada's economic recovery. But we looked, we basically looked at it first. Okay, so why would you invest in energy efficiency to help Canada recover, and we came up with five things. So I'll quickly just kind of outline those. So if you're listening at home, and you want to take notes, here we go. First is obviously I've already stated this creates jobs. So you know, there's a lot of people whose lives have been disrupted, there's a huge opportunity, there is so much energy waste in Canada, that we can put a lot of people back to work doing it. The second thing is it increases consumer spending in the local economy. So as I mentioned earlier, that example of, you know, the restaurant at the top of my street, what ends up happening is you start to boost local economies, when you do this, people spend, they hire local contractors, but then they have savings. And then they spend that again, and so it ends up circulating back into the local economy, which helps with economic recovery. The third thing is, you know, it's through government, investment or government policies, government procurement, what you end up creating is a, essentially a pipeline of projects. And, and that builds, you know, investor confidence, you know, with financial institutions and different stakeholders in the sector, that there's a place where we can put our money that's going to generate a return on investment. That's really exciting. Now when everything is, you know, up in the air and other upside down, you know, one of the things you can pretty much bank on is that if you make certain changes, let's say to a building, you're going to get your savings back over time. And, you know, there's very sophisticated models that help you plan that out. And, it always works. So that kind of investor confidence where people can kind of start to take their money and kind of place it somewhere is a really important thing, as you know, economies try to get out of recessions. The fourth thing is, is the link between energy efficiency and kind of managing ongoing concerns related to COVID-19. You know, you know, things related to ventilation, things related to how we are interacting with our indoor environments now is a huge part of, you know, the Future Part of Canada. And so baking in energy efficiency, and combining energy efficiency, design or renovation as part of a way to manage pandemic concerns is another reason why it's a core part of recovery. And then the last thing is, and, you know, there's some work being done by the insurance bureau of Canada and a lot of great people across the country around resilience. And I think this is something that energy efficiency and making buildings and, and, you know, our infrastructure more resilient, is, is going to be key, because no matter what we do now, as far as emissions, a lot of the emissions are historically locked in. And so how do you combine energy efficiency, to help our buildings manage and adapt to a changing environment? Another reason why it's such a core part of our recovery.
Dan Seguin 21:42
Okay, so let's move to the next question. What kind of funding for energy efficiency and retrofit projects are you hoping for with respect to Canada's economic recovery being a green recovery?
Corey Diamond 21:55
Yeah, so we kind of work backwards and thought, okay, so if we need to get to a certain point within five years, and what that looks like, is essentially a tripling of our activity now of energy efficiency activity. It's about a $27 billion investment, that's a lot of money. And, and that's over five years. But the interesting thing about it, you know, when we talk about this, we don't, we don't necessarily talk about energy efficiency is, you know, one time payment, and it's out the door. As I was saying earlier, from an economic standpoint, it really is an investment. This is about how you structure your economy and your society to eliminate the bad parts of it. And so to do that, you invest and you invest in the types of things that are going to generate jobs, you invest in the types of things that are going to circulate money in the local economy. So that's, that's 27 billion over five years, as I mentioned earlier, this is that that's a recommendation to the federal government only. We have seen $6 billion dollars announced in programs thus far. So we're on our way. But certainly there's a long way to go, especially if we're going to keep up with some of the plans that we're seeing around the world, including President Biden's plan, climate plan. And then as I mentioned earlier, the European new green New Deal, which is really kind of paving the way for significant investment in this.
Dan Seguin 23:22
Aside from the need for more financial support from our governments, what sort of policy changes must happen to bring our energy efficiency game to the next level?
Corey Diamond 23:34
Yeah, it's a good question. I kind of touched on the building code piece earlier, you know, that's definitely one of them. 60% of our new buildings, you know, that you build today are going to be around by 2050. And I was actually thinking about that number, I was doing a walk this morning, and I was looking around, I'm like, pretty much every building in my neighborhood is over 100 years old. So if you're, if you have an ambition, like, you know, governments, corporations around the world are pushing towards net zero by 2050. Why would you lock in carbon right now, with every new building, you know, especially when we have the technology, the know how, the services, the workforce to do that? Why are we doing that? And so we're pushing as hard as we can to make sure that all levels of government are looking at new building codes, and also, you know, what they call alterations to existing building codes. So thinking about what we do with all of the existing building stock to bring that up to a level that is Net Zero Energy Ready. So we need that immediately. We're, you know, spending a lot of time advocating to governments across Canada on that. The second thing we need is, is policies related to workforce development, you know, certainly COVID has kind of put Canada and all nations around the world into a bit of a pickle, right? We are we're kind of stuck here where we're trying to figure out where do we go from here and how does that The world change because of the situation we're in right now, that requires some real thinking and requires to match the kind of policy ambition you want to see in the climate side with significant investment or matching investment in developing the workforce, for that policy and vision, certainly the market will dictate certain things. And, you know, I think we're already seeing that in the energy efficiency sector, but policies have a huge impact on where this market goes. And particularly, we need to match that policy with ensuring that people understand that there are various different career pathways they could take in the sector, that it could be a safe landing space. And, you know, the energy efficiency sector, just like many sectors in the country needs to up its game and its inclusion of women and inclusion of a more diverse workforce. What a great opportunity we're in right now to do that. And, and it's, it's an exciting time. And I think that, you know, especially with young people who are looking at the way the world is going, they want purposeful work, they want meaningful work, they want to do stuff that helps you know themselves, but also helps the country and the climate. And I think we're gonna need some leadership in this country around that so that people are nudged in this direction, and given an opportunity to enter a workforce that is meaningful, that is purposeful, and that helps us, you know, ultimately get to the net zero emissions future we want to see.
Dan Seguin 26:36
Efficiency Canada has recently published its second annual provincial energy efficiency scorecard, which ranks Ontario fourth in the country overall, in 2020. What are the key focus areas or topics that contribute to those rankings? And can you maybe highlight one or two things that Ontario is doing very well with? And what the key areas of improvements are?
Corey Diamond 27:03
Yeah, So what we do is we look at a number of things, we look at how each province is doing on their programs, so energy efficiency programs that they're providing to, to people, we look at the enabling policies - so like I mentioned things like building codes - we look at how they're doing on buildings, we look at how they're doing on transportation, and then we also track industry. Ee do that across the country. And we look at every single province, we're starting to bring into territories, you're right, Ontario is now ranked fourth, it's a slip, they were third in the previous year. So you're starting to see some backwards movement in Ontario, largely due to some of the cancellations of programs when premier Ford came in, but they're doing some good things, we are doing some good things here, you know, we'd like to see, for example, do some innovative stuff, you know, non wire or non non pipe alternatives. Certainly the ISEO is moving ahead with an auction around energy efficiency, that's new Enbridge doing some geo targeting stuff. So there's some cool stuff going on as far as kind of taking efficiency out of the more traditional realm and kind of pushing the barriers a bit. So so we like to see that. But it can definitely improve, we can definitely improve things here. There's two areas that we called out in our scorecard around improvement. One is around natural gas savings. You know, Enbridge does a great job in delivering and implementing energy efficiency. But we noticed that in 2018, the Ontario government actually in their environment plan called for a significant increase in natural gas savings as part of its environment plan. And then when it came down to, you know, directing the Ontario energy board around that they basically said you don't need to, to listen to our environment plan. So that was that was a bit of a step backwards, I think, you know, at least from our perspective, because there's a massive opportunity to do more on natural gas savings by a bunch of experts who know what they're doing. And then the second thing around improvement is really around electric vehicles, because we track that too. And, you know, 1% of vehicle registrations in Ontario are EVs. And if you compare that across the country, BC is at seven 7%. Quebec almost at 6%. It's been in the news a lot lately, because Will Ferrell was in the commercial, but Norway's at 50%. So, you know, we can do this and it's largely driven by policy, right? That's how you do that. And so, you know, especially,now in Ontario, where there's been some great announcements around, you know, essentially making these cars here. I think it's time that we started to see a much more aggressive push to enable Ontarians to access these types of vehicles as well.
Dan Seguin 29:52
Okay, Cory, as we close out part one of our discussion on energy efficiency. What do you think is the most important thing utilities, governments, regulators, businesses and consumers can do to accelerate clean power and electrification? And what will be the biggest barrier to getting there?
Corey Diamond 30:14
That's the money question these days, right? I would probably have the same answers I would have for anything going on in 2021. That, you know, we need to treat this situation we're in as the emergency that it is. And I think, you know, all of us who have lived through the past, you know, 11 months have seen us, you know, respond to an emergency. And, you know, it's no secret that the chaos that the climate crisis is going to create, or is creating right now, for many, many people around the world is going to be something that we can't even imagine. And, you know, if you are a decision maker in a utility or business or regulator in a government, we need to start thinking of this as a significant emergency, which means we need to act much faster. And, and, and, and much deeper than we've ever worked before. And I think we can do that. Because the stuff we're talking about is not controversial. I mean, compared to a lot of other policies out there. Maximizing energy efficiency is not controversial. It's got broad, nonpartisan support, we've got states down and south of us, or countries in the US that are way beyond where we are today. So getting there is not not the hard part, and you know, it's safe. So I think we need to maximize this as fast as possible, because the cost of inaction is just far too high. You know, not just, you know, morally, but, but but financially and socially as well. So what's the barrier to that, you know, I, you know, I guess it's just inertia and, and, you know, a general lack of treating it as, as the emergency that is, and, you know, the savings levels that we're aspiring to, and, you know, the types of things we're calling for, you know, shouldn't have that much political inertia in it, and we're starting to see a big change, we're starting to see a shift to that, but nowhere near the level that we need to in order to move at the speed and the depth that that we need to so I think the way to do that overcome that barrier is really kind of what we're trying to do it efficiency Canada, which is really trying to organize this sector and, and come together as a, you know, a really intelligent and kind of future forward thinking sector to unlock that inertia, and organize ourselves to make it make it known that this is a real solution. I know we can do it. We just have to, we just have to do it. Yeah.
Dan Seguin 32:48
We've reached the end of another episode of The ThinkEnergy podcast. Thank you so much, Cory, for joining me today. I would usually close off with some rapid fire questions, but I'll save those for when you join me next time on part two of our chat about energy efficiency. And we take a deeper dive into what energy efficiency means at the local level of municipalities, businesses, and homeowners. Thank you so much for joining me today. I hope you had a lot of fun.