Buildings are where the electrification strategy meets implementation. They are one of the primary drivers of change when it comes to electricity demand.
Canada’s newly-released National Electricity Strategy for an electrified Canadian economy highlights how buildings, among other sectors, are a nation-building opportunity for economic growth, affordability, and climate action.
It’s an essential step that the strategy commits to exploring demand-side measures to reduce energy bills, alongside a doubling of the country’s electricity grids to meet rising demand. Specific measures include encouraging large building retrofits and leveraging codes, standards, and integrated resource planning to help manage demand.
However, realizing this potential will require a clear sector roadmap, led by the federal government in collaboration with provinces and territories, that defines the role of buildings at a system level. Combined, these efforts have the potential to position buildings as a crucial system-level lever in the transition to an electrified economy.
Buildings Should Be a Core Pillar, Not Supporting Policy
Buildings can help reduce and balance electricity demand, a particularly important consideration when that demand is expected to double as transport, buildings, and industry are electrified. But to make that happen, Canada will need a coherent buildings strategy with targets for electrification rates, a clear articulation of the depth and scale of the retrofits to be achieved, and a focus on building performance outcomes.
It’s worth the effort, because buildings are one of the core pillars of electrification and can act as invaluable grid assets. This is particularly true as buildings are increasingly called upon as active system resources that can help manage demand by acting as flexible loads, facilitated by assets such as thermal storage and distributed energy resources (DERs). Within the electricity strategy, positioning buildings as a core pillar of electrification would see demand response (DR) and storage take a larger role in the electrification strategy as these assets offset expected increases in demand, while also offering greater system flexibility.
A strategic focus on buildings can help reduce peak demand, there is an opportunity to position buildings as a central resource in both hosting and managing electrification. As the site of thermal storage resources and hybrid systems, buildings can help reduce demand and manage electricity use. That means building assets can help utilities defer or avoid higher infrastructure costs and shave down peak demand, which most often rely on high-emissions conventional fuels.
These specifics are omitted from the strategy, in part, because the document itself is also unclear on the role of utility-led demand-side management (DSM) and performance-based regulations, and how that activity can take advantage of buildings as a system-planned resource. It also points to an over-reliance on supply-side resources over the potential for demand-side levers, primarily buildings, which can drive both efficiency and flexible demand.
Buildings Are a Demand-Side Driver of Change
Buildings are where the electrification strategy meets implementation. They are one of the primary drivers of change when it comes to electricity demand.
As the largest scalable lever for turning clean electricity into emissions reductions, cost savings, and grid flexibility, they are central to energy efficiency, grid stability, and integrating new generation, while also offering a key opportunity to accelerate DERs like rooftop solar and electric vehicles. .
As the strategy acknowledges, buildings will be a primary source of new demand as the electrification of heating/cooling and hot water in existing buildings and new construction (electrified or not) increases. This makes buildings a primary lever for decarbonization, as electrification becomes an opportunity to offset demand from conventional fuels and lower emissions. To increase their impact as a tool to manage electrification resources through energy efficiency and load management, buildings must be recognized for the central role they play in affordability, optimization, and modernization.
Buildings can help achieve the goals of the National Electricity Strategy through:
• Contributions to affordability for both homes and businesses: Buildings can help reduce energy costs over the lifetime of the building. New construction should be electrification first, and retrofits must be whole-building, envelope first (or demand reduction first and beyond heat-pumps).
• A tool for system optimization: Demand-side solutions like energy efficiency, load management, and deep retrofits (including fuel switching, air sealing, and insulation) can help reduce energy waste and shift demand away from peak times. This helps avoid new electricity system infrastructure.
• The platform for grid modernization: Distributed energy resources like solar, storage (including electric vehicle batteries), and smart controlscan be treated as flexible loads to help manage both resources and costs.
To achieve these ambitious but achievable goals, the buildings sector will require support, in the form of policy and programs that serve both large buildings and those most in need—particularly the multi-unit residential buildings (MURBS) which are often the most accessible and affordable housing options. A coordinated, effective electrification strategy must define a role for effective building codes and performance standards and focus on integrated energy planning across buildings and grids.
All of this potential points to the need for a sector roadmap, led by the federal government in collaboration with provinces and territories, that defines a system-level role for buildings as flexible resources and contributors to peak management, while articulating a clear role for utilities. As an essential asset for both decarbonization and the success of the electricity strategy, buildings should be considered as active, strategic infrastructure for the electricity system.
Kevin Lockhart is Director of the Buildings Program at the Calgary-based Pembina Institute.