Like housing affordability, climate change is a top-of-mind issue for Canadians. And there’s an important role that housing can play. But smart climate change policy is required to ensure that addressing climate change doesn’t put homeownership further out of reach. The federal government has policy levers to address climate change and improve affordability in tandem — and it will take smart policy to get it right.
The Canadian Home Builders’ Association and our members have been at the forefront of energy efficiency in Canada for decades, leading with the R-2000 program, ENERGY STAR, and now our Net Zero Energy Home Labelling Program. The result: today’s houses are nearly twice as energy efficient as they were when the Kyoto Protocol was first signed.
So how do we keep building energy efficiency into our homes without damaging affordability? Here are the smart policy solutions to get us there.
Affordability and the National Building Code
Younger Canadians, new Canadians and young families want to fight climate change but are also working hard to achieve homeownership. They must not be locked out of the market as a result of accelerated changes to building codes that are not cost effective. The ‘affordability gap’ that currently exists with respect to higher energy performance housing, like Net Zero Ready, must be closed before code changes are made. CHBA is leading the way with innovation and a voluntary program for homeowners that want to invest in their homes by making them Net Zero; but R&D and innovation are needed before higher levels of energy efficiency are affordable for all. Regulating before that point will make housing less affordable. The federal government should work to enshrine affordability as a core objective of the National Building Code, particularly as it relates to greenhouse gas (GHG) mitigation and climate change adaptation, and invest more in research and development for innovative solutions.
EnerGuide Rating System for Houses
Having the EnerGuide label on all houses at the time of resale has the potential to dramatically raise the energy literacy of Canadians, help home valuations truly reflect energy efficiency, and further encourage Canadians to make energy efficiency and retrofit investments on an accelerated pace in ways they can afford. The Government of Canada’s EnerGuide Rating System for Houses should be expanded and promoted as the backbone of all housing incentives, tax credits, and other energy efficiency initiatives by governments, utilities and other organizations. Consistency and clarity can help homeowners tackle climate change.
Permanent Renovation Tax Credit
A permanent, modest energy retrofit tax credit – based on the use of EnerGuide Rating System (ERS) – would help Canadians improve the energy efficiency of their homes, benefitting themselves, the economy, and national competitiveness. Every dollar invested in upgrading the energy performance of an existing home will yield four to seven times more GHG reductions than the same dollar invested in a new home. By fighting the underground economy and bringing cash deals above board, it also has the capacity to have increased tax revenues essentially pay for the tax credits.
With smart policy in place, the government can help address climate change while improving housing affordability.