review of effectiveness of investments in renewable energy for social and affordable housing

226 Pages·2017·3.79 MB·English

by  Amanda Yip

REVIEW OF EFFECTIVENESS OF INVESTMENTS IN RENEWABLE ENERGY FOR
SOCIAL AND AFFORDABLE HOUSING

Final Report

May 2017

Prepared for:

Evergreen

Prepared by:

Toronto and Region Conservation Authority
Under the
Sustainable Technologies Evaluation Program
Review of Effectiveness of Investments in Renewable Energy for Social and Affordable Housing

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Review of Effectiveness of Investments in Renewable Energy for Social and Affordable Housing
NOTICE

The views expressed in the publication are the views of Evergreen and TRCA, and do not necessarily
reflect those of the Government of Ontario. The contents of this report do not necessarily represent
the policies of the supporting agencies. Although every reasonable effort has been made to ensure
the integrity of the report, the supporting agencies do not make any warranty or representation,
expressed or implied, with respect to the accuracy or completeness of the information contained
herein. Mention of trade names or commercial products does not constitute endorsement or
recommendation of those products.

PROJECT TEAM
Evergreen
Isabel Cascante, Managing Director, Programs
Michele German, Senior Manager, Policy and Partnerships
Robert Plitt, Executive Director, Collective Impact
Geoff Cape, CEO

TRCA
Gil Amdurski, Technical Co-ordinator
Erik Janssen, Analyst
Ian McVey, Project Manager, Ontario Climate Consortium
David Nixon, Monitoring Specialist
Amanda Yip, Project Co-ordinator
Tim Van Seters, Senior Manager, Sustainable Technologies Evaluation Program

York University
Dr. Mark Winfield, Professor / Co-Chair, Sustainable Energy Initiative (SEI)
Dr. Eric Miller, Sessional Instructor/ Consulting Economist for Sustainability
Jenessa Doherty, Masters Candidate

University of Guelph
Dr. Kirby Calvert, Assistant Professor, Department of Geography
Abhilash Kantamneni, PhD Candidate

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THE SUSTAINABLE TECHNOLOGIES EVALUATION PROGRAM
The Sustainable Technologies Evaluation Program (STEP) is a multi-agency program, led by the
Toronto and Region Conservation Authority (TRCA). The program helps to provide the data and
analytical tools necessary to support broader implementation of sustainable technologies and
practices within a Canadian context. The main program objectives are to:

• monitor and evaluate clean water, air and energy technologies;
• assess barriers and opportunities to implementing technologies;
• develop tools, guidelines and policies; and
• promote broader use of effective technologies through research, education and advocacy.

Technologies evaluated under STEP are not limited to physical products or devices; they may also
include preventative measures, alternative urban site designs, and other innovative practices that help
create more sustainable and livable communities.

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ACKNOWLEDGEMENTS
This project was conducted in partnership with Evergreen and under the sponsorship of the Ontario
Ministry of Municipal Affairs and Ministry of Housing. Funding support for this document was
generously provided by:

• Ontario Ministry of Municipal Affairs and Ministry of Housing
• Canada Mortgage and Housing Corporation
• Natural Resources Canada’s Program for Energy Research and Development

The project team would like to thank the Ministry of Housing and CMHC for their support and
expertise as members of the steering committee for the project. The project team would also like to
thank the Ministry of Energy, and housing providers, service managers, and vendors that participated
and helped with the project.

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LIST OF ACRONYMS
AHP Affordable Housing Program
ASHRAE American Society of Heating, Refrigeration and Air-conditioning Engineers
ASHPWH air-source heat pump water heater
BAS building automation system
CBA cost-benefit analysis
CCAP Climate Change Action Plan
CDFI community development financial institutions
CGB Connecticut Green Bank
CIC community investment corporation
CMVP Certified Measurement and Verification Professional
COP coefficient of performance
CSI California Solar Initiative
DG distributed generation
DHA Denver Housing Authority
DOE U.S. Department of Energy
ECM energy conservation measure
EF emission factor
EER energy efficiency ratio
EPBD Energy Performance of Buildings Directive
EPC energy performance contracting
ESCO energy service companies
EU European Union
EVO Efficiency Valuation Organization
FIT Feed-In Tariff
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FHP Fair Hydro Plan
FRESH Financing Energy Refurbishment in Social Housing program
FTE full-time equivalent
GDP gross domestic product
GHG greenhouse gas
GHX ground heat exchanger
HHV higher heating value
IEA International Energy Agency
IESO Independent Electricity System Operator
IPCC International Panel on Climate Change
IPMVP International Performance Measurement and Verification Protocol
ITC investment tax credits
kWh kilowatt hour
kW peak power rating
p
LCA lifecycle analysis
LDC local distribution company
LED light emitting diode
LIC local improvement charge
M&V measurement and verification
MASH Multi-Family Affordable Homes program
MH Manitoba Hydro
MHO Ministry of Housing, Ontario
NAICS North American Industry Classification System
NEMVP North American Energy Measurement & Verification Protocols
NGO non-governmental organization
NIR National Inventory Report
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NREL National Renewable Energy Laboratory
O&M operations and maintenance
OBF on-bill financing
OCC Ontario Climate Consortium
OESP Ontario Electricity Support Program
OPA Ontario Power Authority (OPA merged with Independent Electricity System Operator
(IESO) on Jan. 1, 2015)
PACE Property Assessed Clean Energy
PIF project information form
PV photovoltaic
RE renewable energy
REI Renewable Energy Initiative
RESHAPE Retrofitting Social Housing and Active Preparation for EPBD
RESOP Renewable Energy Standard Offer Program
ROI return on investment
ROSH Retrofitting of Social Housing Program
SAM System Advisor Model
SASH Single Family Affordable Homes Program
SEED STEM, Energy and Economic Development Program
SEER seasonal energy efficiency ratio
SHRRP Social Housing Renovation and Retrofit Program
STEP Sustainable Technology Evaluation Program
TRCA Toronto and Region Conservation Authority
TREES Training for Renovated Energy Efficient Social Housing Program
UK United Kingdom
UNFCC United Nations Framework Convention on Climate Change

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EXECUTIVE SUMMARY
Background and objectives
With the government of Ontario looking to rapidly scale-up low carbon investment in the social and
affordable housing sector as part of the Climate Change Action Plan, the question of how to structure
investment programs to deliver the most impact in terms of greenhouse gas (GHG) reductions and
operating cost savings for housing providers is paramount. In order to develop insights on sector
capacity for implementing low carbon investments, an evaluation of the Renewable Energy Initiative
(REI) was sponsored by the Ontario Ministry of Municipal Affairs (MMA) and Ministry of Housing
(MHO), Canada Mortgage and Housing Corporation (CMHC), and Natural Resources Canada’s Program
for Energy Research and Development. Launched in 2010 as part of a comprehensive economic
stimulus program targeting Ontario’s social and affordable housing sector, the REI disbursed
approximately 57M$ in provincial and federal funding to 161 different social and affordable housing
providers for the installation renewable energy (RE) systems, including: solar photovoltaics (PV), solar
domestic hot water (SDHW), solar air heating, geothermal and wind turbines1. Housing providers from
all service regions across the province participated in the REI, but providers from 14 of 47 service areas
did not participate.

This report, prepared by the Toronto and Region Conservation Authority (TRCA) and Ontario Climate
Consortium (OCC) in partnership with Evergreen, evaluates the social, economic and environmental
outcomes of investments in the REI program and provides insights on preferred investment strategies
to scale-up investment supporting the transition to net-zero communities in line with provincial and
federal government GHG reduction commitments to the global community. The research
incorporated a cross-jurisdictional review, 31 formal interviews and 27 informal conversations with key
REI stakeholders (including housing providers, service managers, vendors and administrators), 19
completed surveys from housing providers that received REI funding, 17 site visits to REI funded RE
systems, 10 case studies as well as a technical, financial, GHG and economic analyses. Benefits of the
REI program were evaluated based on its effectiveness in achieving social, economic and
environmental outcomes for social and affordable housing providers. Implementation challenges and
lessons learned were also documented.
Findings
Overall provider experience of the REI program
During interviews and surveys, the majority of housing providers responded positively when asked
about their experience with the REI program and felt that the installed systems were a success. Most
reported minimal barriers to participation or program administration issues, aside from tight
application timelines and issues connecting projects to the electricity grid. Though Local Distribution
Companies are generally required to help customers connect to their network in a timely and efficient
manner, connection of projects is subject to technical and safety limits. At times, a new connection

1 The total amount of funding allocated under REI was 75M$ – with 65M$ to SHRRP funded projects and 6.9M$
to AHP projects. The final amount spent on SHRPP-funded REI projects was approximately 57M$. This report
focuses on the final amount spent on SHRRP funded projects only.
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Review of Effectiveness of Investments in Renewable Energy for Social and Affordable Housing
can require an upgrade of the network, delaying connections. It may be uneconomic for projects to
connect to the grid in certain areas. Solar domestic hot water (SDHW) systems were highlighted by
some providers as having poor returns when offsetting natural gas.
Energy, cost and carbon savings
Key impacts of the REI are quantified in Table 1. The majority of funded systems were PV because it
had the strongest financial performance due to the Feed-In Tariff (FIT) program, which paid a
guaranteed, fixed-term price designed to recover costs plus a reasonable rate of return for grid-
connected PV electricity. The financial performance of the remaining systems depended on the fuel
that the systems were offsetting. Financial performance of solar air or geothermal was strong when
compared with electric resistance heating, with net lifetime benefits outweighing system costs by a
factor of three, approximately. However, estimated lifetime benefits were less then system costs when
the systems are offsetting natural gas, due to low gas costs. SDHW was estimated to produce net
lifetime benefits much lower than total system first costs regardless of the fuel being offset. GHG
savings were much higher for systems that offset gas.
Table 1. Results from technical, financial, GHG and socio-economic analyses.
Funding # of Energy Net lifetime GHG Full-time
systems generated benefits for savings equivalent
funded or saved housing job creation
providers
[M$] [GWh] [M$]2 [kt CO2e]
PV 39.1 255 132 62.2 6.6 411
SDHW 12.1 80 40 2.4 –3.3 6.9 128
Solar Air 3.7 17 65 3.9 –5.2 11.1 39
Geothermal 2.5 9 34 1.3 –2.3 7.2 26
Wind3 0.0 1 0 0.0 0.0 0
Totals 57.4 362 271 69.8 – 73.0 31.8 604
Economic returns within Ontario
Based on input-output analysis, the REI program was estimated to have generated as much as 62M$ of
additional Gross Domestic Production (GDP) in Ontario. This additional production would have
required as many as 604 Full-Time-Equivalent (FTE) jobs in Ontario, earning up to nearly 37M$ in
labour income. An additional 3.2M$ in indirect tax revenue was likely earned in Ontario.
Program administration and guidelines
All stakeholders groups highlighted the REI’s program timelines as a barrier. This likely limited
participation to parts of the sector with higher human resource capacity at the service manager and

2 Note that these values assume that systems are offsetting a mix of 20% electricity and 80% natural gas.
Furthermore, these values are estimates that pertain to the REI program. Great care should be taken when
drawing conclusions about system performance outside of the REI. For example, PV system financial
performance is based on FIT/microFIT rates that are no longer available; a performance de-rate was applied to
SDHW energy generation based on site visit observations, and some system costs may have been higher in the
REI than in the private sector.
3 Note that a small amount of funding was disbursed to one provider for engineering and feasibility studies
concerning a wind turbine installation but the provider did not proceed on to the actual installation of the wind
turbine.
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