Tackling “energy poverty” the next frontier for Canada’s climate commitments

Low-income Canadians should be insulated from carbon price increases, yet so far they have been left out of federal funding for energy efficiency, says Carleton University-based advocacy organization Efficiency Canada in a letter addressed to Federal Ministers.

Since the start of the pandemic and the “build back better” agenda, the federal government has announced efficiency policies aimed at buildings in the large commercial, municipal-community, federal government, and “ability to pay” residential segments, the letter explains.

So far, low-income Canadians and those experiencing high energy cost burdens are left out. Low-income homeowners and market renters cannot reasonably be expected to pay the up-front costs required to access federal grants or to take on additional debts from the planned federal low-interest loan. Supporting low-income households requires a separate approach.

A household is said to experience “energy poverty” when it spends 6 per cent or more of after-tax income on home energy needs — more than double the Canadian median. In Canada, 22 per cent of all owner households (2 million) and 16% of renter households (715,000) face too-high energy cost burdens. Further, Canadians living in rural areas, recent immigrants, and Indigenous households face higher energy poverty rates than general populations.

One way to reduce high energy burdens is through energy efficiency upgrades, says the organization. These not only cut energy costs, but can also reduce greenhouse gas emissions, enhance the indoor air quality and resiliency of the home, and improve the health of people living there.

To ensure everyone can enjoy the benefits of an energy efficient economy, Efficiency Canada argues the federal government should fund low-income efficiency at a level that is, at least, equal to what has already been earmarked for commercial buildings, and home retrofits for higher-income Canadians ($2-3 billion). A federal initiative promoting energy poverty and emission reduction objectives will need to coordinate with existing utility, provincial, and community level programs to leverage their expertise, effectively engage low-income communities, and avoid customer confusion by offering one-stop-shop services.

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