Toronto to expand funding incentives for property retrofits in pursuit of 2040 emissions targets

Michael Lewis

Special to Ontario Construction News

Toronto is looking to expand funding incentives to help owners shoulder the costs of property retrofits as the city embarks on consultations toward a building emissions performance standards bylaw. The proposed regulation will set mandatory reduction targets for CO2 and other greenhouse gases that all of the city’s existing buildings must achieve by 2040.

“Climate damage is here and it’s getting worse rapidly,” environmental lawyer and Ward 11 councillor Dianne Saxe said at city council’s July 3 infrastructure and environment committee meeting.

“It’s driving food costs up and putting hundreds of millions of people on the move, looking desperately for a safe place to go. We have a major opportunity to do our part which also benefits us in better air quality, improving health and building green jobs in the city,” she said. “We have so much to gain by acting and so much to lose by inaction.”

With emissions from existing buildings accounting for 56 per cent of the city’s total emissions, and with the city currently not on target to reach its net zero goals, Coun. Saxe said climate change commitments hinge on performance standards regulation.

Coupled with the Toronto Green Standard, which requires net zero emissions for new development applications starting in 2030, the existing buildings regulation aims to help Toronto reach net zero emissions by 2040 and an interim goal of cutting emissions nearly in half by 2030 compared to 2008 levels.

The committee adopted the performance standards plan for residential, commercial, industrial and institutional buildings with amendments focused on financial incentives. The plan sets a framework for public consultations with business and community stakeholders.

The consultations will lead to a bylaw expected by the end of 2025, about nine months behind the original schedule. James Nowlan, the city’s executive director, environment and climate, said timelines have been extended in part to allow more consultation and engagement on issues including support programs.

He said the goal is to determine what is necessary to help people comply under guiding principles that promote equity, affordability, “reasonableness, and achievability.”

A key aim is to make retrofits more affordable, with the committee adopting amendments to the plan that call on the city to work with the province, Ottawa and utilities including Toronto Hydro and Enbridge Gas to expand the Home Energy Loan Program and the High-Rise Retrofit Improvement Support Program.

City staff are also directed to explore options to drive down costs of solar panels and heat pumps through bulk purchasing; to streamline data collection to avoid duplication and to coordinate with Queen’s Park so property owners don’t have to fill out multiple forms.

In a deposition to the committee, Oxford Properties Group’s manager, global sustainable investing said the real estate developer “is committed to providing support on the building emissions performance standards with the City of Toronto.”

Thomas McKeown said Oxford, the real estate business unit of the OMERS public pension fund, is responding to demand from partners, lenders and regulators for investment grade emissions data, which he called the first step to decarbonization. He added that costs of noncompliance and the threat of damage to a developer’s reputation “may move the needle faster” on pollution reduction.

As of 2023 Oxford had cut its global carbon emissions by 22 per cent from a 2019 baseline, he said, with nearly half of its portfolio having either completed or developed a program to reduce emissions.

McKeown said the path to net zero is easier for segments where decarbonization technology is in place such as low-rise industrial developments, while emissions technology needs to be advanced for energy intense operations such as hospitals and automated manufacturing facilities.

In a letter to the infrastructure and environment committee Craig McLuckie, president of the Toronto Industry Network representing companies including Redpath Sugar Inc. and Shell Canada, said the group has concerns about proposed requirements that buildings report water, electricity and natural gas use.

“Our members are being required to report even before consultations are over. Normally, TIN is engaged at the conceptual stage of such an initiative.”

He said city staff has “no idea how difficult it is to separate out water, electricity and natural gas usage for buildings from that used in production,” adding that the data is often proprietary information.

“The city would be well-advised to ask the federal and provincial governments why most manufacturing is exempted from similar reporting requirements,” McLuckie wrote. “Comparing what Toronto plans to do re: an EPS bylaw to what other jurisdictions are doing does not provide a fair comparison since most exempt manufacturing.”

The letter says emissions reporting by the manufacturing sector will “raise the costs of many products used every day in our city.”