June 24, 2024 - Blog Post

Incentives for Energy Retrofits

Utility costs for condominium buildings can account for half of the monthly operating costs.  While many operating expenses are fixed annually and offer little room for adjustment, there is a notable exception: utility consumption.   Financial incentives from various levels of government and local utility companies provide opportunities for condominium corporations to significantly reduce their utility costs.

Utility Cost Reduction Opportunities:
Energy retrofits present a substantial opportunity for condominiums to lower their utility bills.  These upgrades enhance building energy efficiency and contribute to sustainability and environmental stewardship.

Government and Utility Incentive Programs:
Several incentive programs are available to support energy retrofits:

  1. The IESO Save on Energy Retrofit Program provides prescriptive and custom incentives for energy efficiency upgrades, including rooftop unit controls, compressed air systems, demand control ventilation, chillers, motors, unit air conditioners, air source heat pumps, and variable frequency drives.  With the launch of Save on Energy Midstream program, incentives for energy efficient lighting are no longer available through the Retrofit Program, with incentives being provided by lighting distributors.
  2. Energy Performance Program (EPP), also under Save on Energy, provides incentives for 3 years of annual pay-for-performance incentives, based on electricity savings determined by comparing metered consumption to their baseline energy model.  Participants receive $0.04/kWh multiplied by the electricity savings and $50/kW multiplied by the realized summer peak demand savings.
  3. Enbridge Gas offers incentives of up to 75% of project energy upgrade costs, to a maximum of $100,000.  For a limited time, Enbridge is offering up to twice the incentives for boiler and control projects, including $0.50/m3 for natural gas saved on condensing boilers building automation controls, boiler controls, variable frequency drives, and variable air volume systems, and $0.30/m3 for high efficiency (85-89% efficiency) boilers.
  4. Canada Greener Homes Grant and Loan Programs:  Low-rise multi-residential buildings having three or fewer storeys in building height above ground and having a building area not exceeding 600 m2 may be eligible for the Canada Greener Homes Grant and Loan programs for eligible retrofits such as home insulation, windows and doors, heat pumps and renewable energy systems.  Note that side-by-side attached units/houses are considered row houses and are not eligible.
  5. Canada Infrastructure Bank’s (CIB) Building Retrofits Initiative helps to finance capital costs of retrofits, using savings from energy savings, efficiencies, and operating cost savings for repayment.  Low cost, long-term CIB financing is available through Financing Aggregators who may also provide Energy Performance Contracting (EPC) options which could offer up to 100% financing for energy efficiency projects, together with an energy savings warranty.  EPC can eliminate the risks and allow the capital to be paid back from the energy savings generated, reducing impact on the building’s reserve fund. 

Long-Term Financial Benefits:
Unlike many capital renewal projects (e.g., roofing replacements or corridor carpeting), energy retrofits offer a unique financial advantage.  The savings generated from reduced energy consumption can substantially or entirely offset the costs of the upgrades.  This approach provides condominium boards a strategic avenue to undertake necessary capital replacements without severely depleting a reserve fund or resorting to special assessments.

Investing in energy retrofits not only reduces utility costs but also aligns with sustainable practices and responsible fiscal management.  By understanding and utilizing the available incentive programs, condominium corporations can significantly improve their financial standing, enhance property value, and contribute to environmental conservation.  Condominium boards are encouraged to consider these opportunities as part of their long-term strategic planning, ensuring a cost-effective, efficient, and sustainable future for their communities.

Derrick Finn, Finn Projects

Tag(s): adapting to change || be prepared || CCI Huronia || Condo Education || Condominium Education || Financial Benefits || Government and Utility Incentive Programs || Loss reduction incentives || Utility Cost Reduction