The hydro policy on everyone’s mind may be the Fair Hydro Plan’s temporary rate relief, but there are some lesser-known regulations set to substantially impact the way Ontario’s building owners manage their utility usage. The provincial government’s passage of Bill 135 has introduced mandatory Energy and Water Reporting & Benchmarking (EWRB) for large buildings. These regulations require building owners to regularly report certain building and consumption data to Energy Star’s Portfolio Manager; effectively, it’s a way to quantify each building’s energy and water performance. Ideally, energy and water reporting will provide building owners a tool that influences changes that help the environment, promote efficiency, and grow revenue.
The government plans to publish a portion of the EWRB information on Ontario’s open data website, making it easy for prospective tenants to compare how building owners are managing their utilities. The hope is that market forces will incentivize everyone to perform more energy efficiently. Although future changes are not concrete at this point, officials may be moving towards implementing further incentive programs or mandatory efficiency standards. Given the changes to rent control and the removal of above guideline increase for utilities, owners are already running a much tighter ship.
Perhaps acknowledging the current lack of awareness for Bill 135, and the onerous task of developing and implementing a compliance program, the government has pushed back the roll out by one year from the originally proposed timeline.
In the revised Reporting Schedule (Figure 1), note that each reporting date is when the reporting is due for utility data from the previous year, not simply a date to begin recording and reporting consumption. Additionally, reporting will require whole building data. This means that a multi-residential building greater than 100,000 square feet will need to ensure it is tracking consumption during 2018 in order to report that 2018 consumption by July of 2019.
In addition to utility consumption, there is a lot of other standard building data that owners will need to ensure they have available to include in the reporting. Portfolio Manager uses over 130 metrics to analyze and score buildings. This includes detailed information for things like gross floor area, parking garage square footage and times lit, pool square footage and type as well as some heating information. It’s crucial to record meticulously as this information will help determine the score assignments, and allow for more accurate benchmarking comparisons.
Another important requirement is to verify data for buildings larger than 100,000 square feet. A certified professional on the owner’s staff or an independent organization can do the verification, which is due in the first year, and then every five years after that. In the years in between, those affected landlords will report without this check.
Naturally, there are some EWRB program exemptions. Multi-residential buildings below 50 per cent occupancy do not have to comply. As well, owners dealing with financial difficulties could get a pass. If owners believe they should qualify for an exemption, they need to confirm it with the appropriate officials.
Energy Star Portfolio Manager is the compliance platform used in every EWRB jurisdiction in North America, and the Ministry of Energy has selected this same program for use in Ontario. Portfolio Manager is an online platform, housed by the Environmental Protection Agency (EPA), that measures, tracks, and benchmarks energy and water consumption. It also indicates greenhouse gas emissions associated with the energy tracked. Buildings can be compared against other buildings and assigned an efficiency score from 1 to 100. This score takes into account various factors, including weather normalization, unit density, bedroom density, square footage, and more.
By far, the most common way large owners ensure their compliance with similar regulations in other jurisdictions is by utilizing a trusted utility expense management partner. Experienced, independent experts can make sure the owner’s utility data gets where it needs to go, by the time it needs to get there, and in the format required for successful compliance. Utility expense management services typically already have utility data for the services they are providing owners, so it is a small step for them to provide that data to the required compliance platform, such as Energy Star’s Portfolio Manager, upon the owner’s consent. They are also better equipped to handle the bureaucracy of the various utility providers to obtain the necessary data.
Building owners who wait until the last minute to create and implement a solid compliance plan may find themselves at a disadvantage and left to figure out a slapdash compliance process. Realistically, requests to the local utility providers may need to be made months in advance of the due date. Also, proactive landlords may book up all the third party experts who assist in compliance. Fortunately, right now there is still time for property teams to choose a compliance strategy and get it going effectively.
If owners in other provinces are breathing a sigh of relief, they need to bear in mind that other Canadian jurisdictions are running similar pilot programs, including high priority ones in British Columbia and Edmonton. Other Canadian jurisdictions will be judging Ontario’s trailblazing experience to find out if program execution is easy or a hassle, and what lessons can be learned. More such laws are likely to pass across Canada in the coming years.
Globally speaking, Canada is just catching up to other progressive jurisdictions that have implemented EWRB requirements to enhance environmental responsibility. Already in the United States, at least nine major cities and one state are on board. These jurisdictions believe that the health and other benefits of a cleaner environment and better long-term utility management are enough in the public interest to require EWRB.
If there’s a bright side to all this extra work and transparency for landlords, it’s that digging deeper into utility data allows them to see the big picture. Once landlords see a detailed utility analysis, they tend to find ways to cut costs merely by having information that was previously unavailable. Furthermore, any effort to reduce the burden on the energy grid and lower costs for local utility providers could be good news for ratepayers and taxpayers. Also, by collecting information about utility usage by industry type, Ontario will be better equipped to make proactive, versus reactive, energy decisions. Such planned decisions tend to provide better solutions for a lower cost than reactive solutions.
Kevin Whitaker is Director, Utility Expense Management at Wyse Meter Solutions Inc. For more information visit www.wysemeter.com