1. Federal and Provincial Policies to Advance Industrial Energy Efficiency in Canada
EFEX Workshop
ACEEE Summer Study on Energy Efficiency in Industry
August, 2019
Jess Burgess, Econoler

2. Econoler Core Expertise Energy efficiency firm based in Quebec
35 years experience
4,000 projects in Canada and Internationally
Core Expertise
Planning & Strategy
Financing
Evaluation
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3. Policy context 0 – 0.02 kg CO2e/kWh 0.02 – 0.2 kg CO2e/kWh
A third factor of paramount importance when analyzing the energy efficiency sector in Canada, and one that is often forgotten, is that Canada is the world's sixth largest energy exporter and one of the few net energy exporters in the world.
More specifically, in 2015, Canada was the fifth largest petroleum producers and the second largest producer of hydro-electric power. Whereas the petroleum production is mainly concentrated in one province (Alberta), most of hydroelectricity producing is concentrated in three provinces approximately 1,000 kilometers apart (British-Columbia, Manitoba and Quebec).
This fundamental difference in the energy source available in each of the province and territory is evidently reflected in the carbon footprint of electricity generation, which varies by a factor of 40 from the lowest to the highest emitting provinces.
Given that for the past recent years many of the demand-side management (DSM) initiatives have been driven by the climate change agenda, the electricity carbon footprint has had an impact on the DSM programs put forward by the governments.
For instance in Quebec, where the electricity is almost entirely produced by hydropower damns and wind turbines, most incentive programs are GHG-focused instead of electricity-focused. Transition énergétique Québec (TÉQ), the independent governmental energy efficiency agency, signs agreements with energy consumers who are ready to commit to a GHG emissions reduction target. In return, TÉQ pays them $ 40 / ton each year they can demonstrate by a rigorous measurement and verification process that they have complied with their GHG emissions reduction target. This GHG-focused approach to DSM in Quebec favors the decrease in natural gas and oil consumption while favoring the electrification of the building heating systems, the industrial processes and the transportation sector.
Contrasting with this approach, Alberta has a much stronger electricity component in its DSM approach. The electricity production in Alberta has the highest carbon footprint in the country and many of the DSM programs offered by Efficiency Alberta, the newly created governmental energy efficiency agency, offers instant discounts, online rebates and other financial incentives targeted at reducing the electricity consumption in homes as well as in the commercial and industrial buildings. These two examples show how the highly diversified energy context in Canada induces energy efficiency initiatives that are highly inconsistent from a pan-Canadian perspective.
Source: Energy Policies of IEA Countries. Canada 2015 Review. International Energy Agency

4. Pricing mechanism by province
Price on carbon
British Columbia
Prince Edward Island
Northwest Territories
Newfoundland and Labrador (in discussion)
Cap-and-Trade
Nova Scotia
Quebec
Federal Backstop
Alberta (partial, 2020)
Manitoba
New Brunswick (in discussion)
Ontario
Saskatchewan
Source: Government of Canada, Pollution Pricing Technical Briefing

5. Federal carbon pricing system
Implemented April 1, 2019
2019 price: $20/ton
Increases $10/year to $50/ton in 2022
Carbon levy on fuels
Output based pricing system
Applies to industrial emitters 50k tons/year
10k tons/year optional participation

6. Federal IEE Activities and programs
Legacy Programs
Network: CIPEC Leaders
Tools & Information
Energy audit
Energy benchmarking
Employee engagement
Funding Support
EMIS
ISO 50001
New Federal Energy Manager Program
Launched July, 2019
Co-funding for energy manager salary or energy management projects
Only available in provinces relying on federal backstop
Alberta
Manitoba
New Brunswick
Ontario
Saskatchewan

7. Alberta: Energy intensive trade exposed industries
Federal Allocations
Output based
Sector specific
Intensity metric
Begin at 80% of sector intensity benchmark
Decline over time
High-risk sectors – cement, iron & steel, lime and nitrogen – receive 90%
Phases 1 and 2 of ECCC’s assessment were complete as of July Phase 3 of the assessment is ongoing and will be based on a “competitiveness analysis.” Factors that ECCC has identified for assessment in this stage include: “evidence of significant facility level impacts, domestic or international market considerations, [and] consideration of indirect costs on sectors associated with carbon pricing” (Environment and Climate Change Canada 2018e). If significant impacts are found then, similar to the Phase 1 and 2 assessments, a sector will be eligible to receive a higher level of carbon pricing support.
Source: Dobson and Winter, 2018, Assessing Policy Support for Energy Intensive and Trade Exposed Industries,

8. Québec: Cap-and-trade
Cap-and-Trade proceeds fund Québec Climate Change Action Plan
Source: Whitmore and Pineau, 2018, The State of the Energy Sector in Québec,

9. British columbia: Industrial Energy management funding
BC applies a tax on GHG emissions
Industrial facilities may access funds to cover 75% of total costs up to $80,000* for energy management projects and equipment
Stackable with some federal funding opportunities

10. Opportunities and…

11. Thank you Jess Burgess Econoler jburgess@econoler.com

12. Source: Whitmore and Pineau, 2018, The State of the Energy Sector in Québec,