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Aging Buildings and the Climate Emergency: Opportunity Knocks!

Great opportunities arise when several trends converge in a way that creates possibilities that would otherwise not exist. One such convergence of trends is the aging stock of commercial and institutional buildings in need of capital reinvestment, the growing urgency of reducing greenhouse gas emissions, and the remarkable advancement in recent years of the design approaches and technologies available for building energy efficiency and electrification.

Working at the intersection of these three trends and focusing on the inventory of Canadian government buildings in Canada’s capital, SSG, whatIf? Technologies, and the Rocky Mountain Institute found that strategic investments in aging buildings can significantly reduce their carbon footprint while significantly cutting energy costs and creating thousands of jobs.

The majority of the 2,200 Canadian government buildings in the Ottawa area are over four decades old. Wrapping strategic energy efficiency retrofits, renewable energy, and district energy systems into planned upgrades offer a historic opportunity for climate action and renewal.

Trend #1: The aging stock of federal buildings

The age profile of federal buildings in the Ottawa area typifies much of the commercial and institutional building stock throughout North America. Fully 70% of the portfolio is over 40 years old; more floor space was added in the 1970s than in all the decades since.

These buildings are due for renewal; indeed, budget pressures have resulted in inadequate maintenance investments over the years, and over 40% of the federal building inventory is in poor or critical condition. Another 22% is in fair condition. Even for those buildings kept in reasonable condition, advancements in building science and technology have rendered critical systems obsolete. Their interior designs and layouts are misaligned with the needs of a modern office working environment and the much greater role of advanced information technologies in the delivery of government services in the 21st century.

The aging inventory of federal buildings. 

Trend #2:  Government commitments to eliminate greenhouse gas emissions

The needed renewal of the buildings coincides with a commitment by the government to reduce greenhouse gas emissions from its own operations by 80%. If the Canadian government adopts the carbon budget under consideration, it would have  an even more challenging target: zero emissions by the mid 2030s.

Emissions from federal operations in the National Capital Region. 

In the National Capital Region (NCR), 98% of emissions from the government’s operations come from building energy use—mostly natural gas for heating—so the emission reduction commitment translates directly into a target to virtually eliminate natural gas consumption. To meet the emission reduction commitment, the impending recapitalization of federal real estate in the NCR must transform the buildings into high efficiency, high performance spaces with zero or very low emissions, including the emissions associated with their electricity use.

Trend #3: Advancing building science and technology.

The science, engineering, and related technologies that are being applied in buildings today would be hardly recognizable to a visitor from the 1970s.  Most of the federal building stock in the NCR predates the invention of the personal computer, never mind the advanced digital sensor and control technologies that are now routinely used to replace overdesign and inefficiencies with precision, efficiency, and superior comfort and building performance. Ironically, it may be that the backlog of deferred maintenance of the federal building stock actually represents an advantage: the government can leapfrog intermediate generations of technology with retrofits to create the low-carbon buildings of the future.

LED lighting systems, high performance windows, air-to-air cold climate heat pumps, electronically commutated high efficiency fan and pump motors, advanced energy flywheels and other heat recovery technologies—these are just some examples of the tsunami of technological innovation that has swept through the building sector in recent years. When combined with deep cost reductions in sensors and digitized control technologies, the recapitalization of old buildings can create healthier, more productive space that no longer relies on antiquated fossil fuel combustion technologies.

Electrification is the key to efficiency, including by switching current electric resistance heating to heat pump technology. Modern, electric-powered technologies are dramatically more efficient than their predecessors or their combustion-based alternatives. In a deep building retrofit, these efficiency gains can drive reductions in power consumption that are sometimes larger than the additional electricity required to switch from natural gas to heat pumps. By combining building energy efficiency and electrification, the decarbonization of commercial and institutional buildings can facilitate grid decarbonization.

The Opportunity: Better buildings and zero emissions through modernization

In a classic example of the whole being greater than the sum of the parts, the SSG/RMI Roadmap to Low-Carbon Operations in the National Capital Region shows how an integrated, whole-building approach to the renewal of federal buildings can result in better buildings that are fossil fuel-free and have lower aggregate electricity consumption than they do today. While the mix of technologies and the energy and emissions outcomes vary from one building to the next, we found that aggregate electricity consumption could be reduced by 25% or more, even as the gas-heated stock is electrified. This is the opportunity created by the convergence of an aging stock, a climate change imperative, and a new generation of building technologies that have transformed the art of the possible.

The convergence of these trends has created an opportunity for the Government of Canada to implement a building decarbonization strategy with a strongly positive economic outcome.  The recommended scenario incorporates deep energy retrofits into 3.9 million square metres of existing government buildings. Compared to the business-as-usual energy-related equipment costs of $4.0 billion, the incremental cost of the retrofit technologies is $1.3 billion, most of which is returned in the form of a billion dollars in fuel and electricity savings. In addition, converting older buildings to more efficient, healthier indoor spaces directly and measurably improves employee well-being productivity worth more than the corresponding fuel and electricity savings. Add in the 50,000+ person-years of direct employment that the government’s investment would generate in the local economy, the avoided social costs of carbon, the reputational benefits to the Government of Canada, the reduced public health costs, and the social capital benefits to the community, and the economic case is open and shut.

The Roadmap shows how the government’s offices can be replaced with dynamic spaces and flexible work arrangements that make its employees healthier and happier. It is a blueprint for creating spaces with better ventilation and temperature controls, all of which enhance focus, productivity, and efficiency. By choosing the path of carbon neutrality, the Canadian government can become a model. It can show all kinds of organizations—from municipal governments to large corporations to other countries—that addressing the climate crisis is about so much more than reducing greenhouse gas emissions. It is an opportunity to build vibrant, healthy, and resilient communities. It is a chance to step onto the best path for our future.

For more insights on how to build a carbon-free future, sign up for the monthly SSG Newswire and updates from the Rocky Mountain Institute’s Carbon-Free Buildings Team.

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Ralph Torrie is a Senior Consultant at SSG and an internationally recognized expert in the field of sustainable energy and climate change response strategies for governments and business.

Combining Electrification and Deep Retrofits to Decarbonize Canada’s Buildings

In the face of the climate crisis, organizations are looking to electrification and renewable energy as a way to get buildings, energy systems, and vehicles off of fossil fuels. But fears abound that plugging too many things into the grid could overwhelm the system and lead to blackouts.

Over the past two years, Rocky Mountain Institute, SSG, and whatIf? Technologies explored this challenge as a part of a consulting project for the Government of Canada to create a pathway to reduce its operational emissions in the National Capital Region to net zero by 2050. Our analysis suggests that by combining electrification with deep energy efficiency retrofits, we can stave off an increase in building-level electricity demand and demand peaks on the electric grid.

Why the Canadian Government Needs to Fuel Switch

In order to decarbonize, the Government of Canada needs to switch away from natural gas for heating buildings. In 2016, the federal government’s operations in the National Capital Region (NCR) emitted 370 kilotons of CO2e (carbon dioxide equivalent). More than 60 percent of emissions from the federal government’s operations come from buildings, most of it from burning natural gas for heating.

 

Emissions by fuel from federal operations in the NCR, 2016. (Designer: Naomi Devine/SSG)

Federal buildings tend to be old, drafty, and overdue for an upgrade. Nearly 50 percent of the government’s building floor area is classified as “in poor or critical condition”. The low emissions intensity of the electricity in Ontario and Quebec—which is powered by hydro—makes electrification paired with high-performance building envelope upgrades an ideal solution to simultaneously upgrade and decarbonize buildings.

Modeling shows that the cost to decarbonize the federal building stock is just 4 percent above what must be spent to maintain the current building stock over the next three decades, as they fall into further disrepair.

The Promise of Heat Pumps

The government’s building upgrades can include switching from natural gas to electric heat pumps that use ambient air, water, or ground temperature as a heat source, or sink, to heat buildings in the winter and cool them in the summer. While building professionals once thought heat pumps to be ineffective in colder climates, the technology has improved by leaps and bounds. A wide range of heat pumps are now available for colder climates and commercial-scale use.

To help the Canadian government figure out how to use heat pumps in more than 2,000 buildings in the Ottawa-Gatineau region, RMI used its Portfolio Energy Optimization modeling approach. Portfolio Energy Optimization aggregates buildings across the portfolio while customizing the energy models per building to represent existing conditions in each facility. We considered different types of heat-pump applications bundled with high-performance thermal envelope and energy efficiency upgrades tailored to residential, commercial, and mixed-use buildings. The results were then fed into whatIf?’s and SSG’s CityInSight model to assess energy consumption and emissions across the entire building portfolio out to 2050, accounting for changing costs, emissions factors, and portfolio-wide asset management plans.

This modeling demonstrated that decarbonizing the federal government building portfolio in the NCR is technically and economically feasible over the next three decades. If combined with deep energy efficiency retrofits like building envelope upgrades, heating electrification of nearly all of the building stock would cost $850 million more than planned building upgrades between 2020 and 2050, while saving about $700 million in energy costs and nearly eliminating emissions. The net cost of $150 million is a drop in the bucket compared with how much the government already spends on building operations. The Canadian National Capital Region has a pivotal opportunity to transform its federal buildings portfolio while minimizing the impact of demand growth on the electric grid.

Building Decarbonization and Electric Demand

The grid can manage large-scale electrification of heating only if it’s paired with measures that manage demand peaks. That’s where building envelope retrofits—upgrading windows, walls, and roofs—come in. Together, these strategies change the profile and timing of building electricity consumption by limiting peak demand.

For buildings on the Ottawa side of the NCR, envelope upgrades can reduce peak demand by limiting heat gains and losses through insulation and lower air infiltration, while electrification may shift these peaks from the summer (cooling demand) to the winter (heating demand). Our models suggest that the heat pumps and envelope upgrades, along with other efficiency measures, will lead to a post-retrofit winter peak that is not much higher than the original summer peak. The net impact of retrofitting modeled buildings in Ottawa with high-performance envelopes and heat pumps on the electricity demand profile is illustrated in the figure below.

On the Gatineau side, most buildings are already heated with electricity, and electricity demand peaks in the winter. Retrofitting these buildings with envelope upgrades and heat pumps does not change the demand load profile through the year, but it reduces the total peak on the electricity grid by up to 25 percent.

Hourly electricity demand for federal buildings in Ottawa (top) and Gatineau (below), before and after retrofits with electrification. (Designer: Naomi Devine/SSG)

Our analysis shows that, when combined with efficiency retrofits, electrification of buildings using heat pumps can shift the time that electricity demand peaks and may even reduce annual electricity demand. As organizations and utilities plan for the future of electrification, efficiency is a critical way to minimize peak demand and make the transition to zero-carbon buildings viable.


For more insights on how to build a carbon-free future, sign up for the monthly SSG Newswire and updates from the Rocky Mountain Institute’s Carbon-Free Buildings Team.

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Lauren Malo has worked on energy and emissions plans across Canada and was a lead analyst for the Roadmap for Low-Carbon Operations in the National Capital Region. She is a former Consultant at SSG. 

Sheldon Mendonca is a Manager with Rocky Mountain Institute’s buildings practice, where he leads projects with the Portfolio Energy Optimization initiative. Sheldon manages work with building portfolio owners across multiple sectors including federal and city governments, real-estate owners and large corporations. He has in-depth experience in net-zero carbon roadmap planning and deep energy retrofits in the commercial and multi-family building sectors.

Aerial view of city

Sustainability, Social Value and Wellbeing in Buildings

Kelly Watson is a Research Associate at the University of Manchester. She recently submitted her PhD thesis that investigated how to measure and disseminate the social value of buildings, using methodologies from the social impact sector. Her current post-doc research has developed a wellbeing valuation approach for the built environment, to promote understanding of the impact of design on the people that use it.