OPPORTUNITY SCREENING STUDY: BUILDING ENERGY REPORTING REQUIREMENT

Transcription

1 CITY OF TORONTO OPPORTUNITY SCREENING STUDY: BUILDING ENERGY REPORTING REQUIREMENT Issued by Halsall on November 24, 204 4Y Prepared For: The City of Toronto Prepared By: Halsall Associates 2300 Yonge Street Suite 2300 Toronto, ON M4P E4 Tel: (46)

2 Table of Contents EXECUTIVE SUMMARY... INTRODUCTION...3. Purpose Methodology BENEFITS OF MANDATORY BUILDING ENERGY BENCHMARKING COMPLEMENTARY PROGRAMS LESSONS LEARNED FROM OTHER JURISDICTIONS Energy Star Portfolio Manager is the Tool Used by All Existing U.S. Programs Stakeholder Engagement Program Scope POSSIBLE IMPLEMENTATION SCENARIOS... 6 KEY ASSUMPTIONS IMPACT OF AN ENERGY REPORTING REQUIREMENT IN TORONTO Program Scale and Market Penetration Energy and Water Conservation Greenhouse Gas Emissions Reductions Financial Impact Social Impact Staffing And Budget Requirements CONCLUSIONS APPENDICES Appendix A: Existing Benchmarking Programs in the United States Appendix B: Key Model Inputs and Assumptions Appendix C: Summary of Research and Interviews Appendix D: Details of Building Types Assessed Appendix E: Limitations Appendix F: Endnotes Appendix G: Tables of Potential Program Results City of Toronto 4Y22-074

3 EXECUTIVE SUMMARY A successful city-wide energy and water reporting requirement by-law has the potential over the next 20 years to avoid over 6 million tonnes of equivalent CO2 greenhouse gas emissions and nearly 40 million equivalent megawatt-hours of electricity and natural gas use combined, while saving over $3 billion for building owners, occupants, and tax-payers and generating as much as 8,000 person-years of employment. While a mandatory energy benchmarking program will create energy savings, Toronto s population is expected to continue growing, causing an increase in energy use. Energy savings from this program may be great enough to balance population growth until at least The program is expected to save 0% or more of Toronto s commercial, industrial and multifamily building energy use after 20 years. The program s success relies on a wide scope of influence, impacting many large buildings (e.g. buildings over 25-50,000 ft 2 ), easy-to-access data, and effective education and compliance support. The sooner this program can be implemented, the sooner Toronto will start to see the benefits it provides. An energy reporting requirement is a program or by-law under which building owners are required to: Consider their building s energy and water consumption and compare it to that of their peers ( benchmarking ), and Disclose this information to the City and/or publicly ( disclosure ). An energy reporting requirement program presents a unique opportunity for Toronto to lead Canadian jurisdictions in becoming an environmentally, economically and socially competitive 2 st century city. The City of Toronto has set ambitious energy use and GHG reduction targets for the year 2020 and 2050 (30% reduction in GHG emissions levels from 990 is targeted by 2020, and by 2050, an 80% reduction from 990 levels is targeted ). Benchmarking is an important next step in Toronto s path to these goals. As of September 204, eleven U.S. jurisdictions have implemented a program like this, and there are many valuable lessons learned that both show the many benefits of an energy reporting requirement and the best practices related to structuring a program for success. The City of Vancouver is currently considering a similar program. The benefits of an energy reporting requirement are well understood and documented. Research (for example, by the US Environmental Protection Agency) has shown that benchmarking that is, requiring owners to consider the energy use of their buildings and their performance relative to that of their peers can produce energy savings. The benchmarking aspect supports conservation through the data it provides both to individual building owners, as well as to the market, the City and utilities. Further savings will come from disclosure, which is relevant to one subset of the data analyzed by the US Environmental Protection Agency. Toronto s Race to Reduce shows that buildings tend to reduce their consumption once their performance is made public Early success from jurisdictions that have implemented such a program show that the City, utilities, and service providers can use the data collected to tailor new and existing programs and policies 3. City of Toronto 4Y Page

4 Additional benefits stem from energy conservation: greenhouse gas emissions are reduced and utility cost savings, projected at $7 billion by 2030 in NYC for example 4, allow owners and occupants to invest in other areas. Research by the Institute for Market Transformation suggests the social benefit of up to 5.32 personyears of employment can be created per $ million saved 5. Other jurisdictions that have implemented such a program have learned that effective communication is important to their programs success, as is making compliance easy for building owners. Building owners and affected stakeholders must be engaged early during the development of a by-law. An appropriate feedback period appears to be between 6 and 2 months long. Effective outreach, education and support during the implementation of the program will also be important. Program success (measured in compliance rate) depends on ease of compliance. New York City boasted an 84% compliance rate in 204 and Seattle boasted 93% compliance in 20/202. Most successful jurisdictions work with utility companies to facilitate easy, automatic uploading of energy-use data, and easy aggregation of whole-building data in multi-tenant buildings. All U.S. programs use the Energy Star Portfolio Manager tool for benchmarking, and it would be an obvious choice for Toronto as well. Portfolio Manager is already in widespread use in Canada, free, public, and easy to use. Most jurisdictions of comparable size, population, and density, have targeted large buildings for program inclusion, since they make up the majority of building gross floor area and energy use (35% of Gross Floor Area and 25% of electricity consumption in Toronto 6 ). City of Toronto 4Y Page 2

5 INTRODUCTION. Purpose The City of Toronto is exploring the possibility of implementing a building energy reporting requirement. To this end a study has been conducted to evaluate the opportunities, benefits, and potential costs to the City of Toronto..2 Methodology This study was completed in two phases. The first phase involved investigating similar programs implemented in jurisdictions in the United States. The second phase involved estimating the potential impact of a building energy reporting requirement on energy and water use in the City of Toronto. To this end, possible scenarios (labelled Scenario A and B ) were modelled. The analysis was based on information collected from the research and interviews conducted in the first phase, as well as information on Toronto s building stock from the MPAC database provided by the City of Toronto. 2 BENEFITS OF MANDATORY BUILDING ENERGY BENCHMARKING Mandatory building energy benchmarking is a fairly new concept in North America. As of September 204, only nine cities and two states in the U.S. had implemented an energy reporting requirement ordinance and of those only three had two or more years of information available: New York City, San Francisco, and Seattle 7. Toronto as a Canadian Leader Globally this type of program has been implemented on the national scale; many countries in Europe currently require Energy Performance Certificates for residential, non-residential, and public buildings. The buildings in the program scope vary slightly by country. These certificates must typically be disclosed at the time of any retail transaction 8. Reduced Energy Use and Greenhouse Gas Emissions The benefits of benchmarking include direct energy savings, GHG emission reductions, and job creation, coming from a combination of increased awareness and market forces. Benchmarking provides building owners and managers with an easy-to-understand measure of their building s performance and allows them to see where they stand compared to similar buildings. This information can inform changes to building operation that can result in appreciable energy savings. An Environmental Protection Agency study has found that as much as 7% energy savings over four years (2.4% per year average) can be expected from benchmarking alone 26. City of Toronto 4Y Page 3

6 Market force makes public disclosure an important part of a benchmarking program. Market forces arise because the program increases transparency. When building information is publically disclosed, prospective tenants, buyers, and investors can identify which buildings are the most energy efficient and incorporate this information into their decision-making processes. Toronto s Race to Reduce program demonstrates how competition drives energy performance improvements. Buildings participating in this program cumulatively reduced energy use by 9% over two years (4.5% per year) 9, which is more than twice the 2.4% impact of benchmarking alone found by the Environmental Protection Agency. Northeast Energy Efficiency Partnerships identifies disclosure as an important part of a building benchmarking program, and cites transactional or public disclosure as a mechanism to promote transparency in the building market. This protects consumers making informed decisions similar to the way vehicle fuel efficiency is now reported to buyers 0. Creating Jobs The energy savings stemming from benchmarking and reporting will create both direct and indirect employment. Direct jobs are created including additional on-site operational labour required to run a building, manufacture and installation of lighting, HVAC, water heating equipment, appliances, windows, insulation and other building elements. These jobs are created since demand for energy saving retrofits requires energy consultants and skilled laborers to implement 5. IMT attributes 30% or more of jobs generated to installation. It is reasonable to expect that all created installation jobs will be local, and at least some manufacturing jobs will be local, directly fuelling local economies. Indirect jobs are created because the money saved on utility bills is spent elsewhere. A 202 paper by the Institute for Market Transformation reports that the re-spending of energy savings directs economic activity away from the energy supply industry, which supports very few workers per dollar received, towards other more labour-intensive sectors of the economy (for example, retail, healthcare, and food services) 5. Jobs are both gained and lost when money is redirected elsewhere from utility companies, but research conducted by the Institute for Market Transformation and the Political Economy Research Institute suggests a net increase in employment of approximately 5.32 person-years of employment for each $ million saved on utility bills. Industries anticipated to benefit include education, retail, offices, warehouse and storage, lodging, religious organizations, social advocacy organizations, healthcare, food sales, food services, and other 5. Reducing Grid Stresses Rapid growth has placed strains on several parts of Toronto s electricity grid. The City and Toronto Hydro have already concluded that reducing electricity demand from buildings will help reduce the investment required in new distribution infrastructure. As Toronto s large buildings both new and existing reduce their energy consumption, strains on the grid will be reduced. Informing Future City Programs Once the building stock has been benchmarked it will allow the City to map areas and sectors of higher-thanaverage energy use which will facilitate the creation of programs targeted specifically to those areas and to target programs for specific market segments and building types. In Toronto, this could assist with development and/or expansion of district energy systems and community energy planning. This ability to tailor programs to those buildings that need them the most has been successfully implemented in Boston, whose energy reporting requirement was first implemented in City of Toronto 4Y Page 4

7 Further Social Benefits There are additional anticipated benefits associated with reducing energy use in buildings including improved affordability in residential buildings and improved air quality in the city. As energy and water use decreases, the amount of money families and individuals will have to pay for utilities may also decrease, reducing the cost of living for Toronto residents. In rental units where the property manager pays the utility bill, decreased energy use may lead to reduced pressure on rent increases. The air quality in Toronto may also improve as the amount of natural gas burned to heat buildings decreases, resulting in less pollution and harmful smog in the city. 3 COMPLEMENTARY PROGRAMS Energy benchmarking on its own has the potential to reduce energy use and GHG emissions, but many U.S. jurisdictions consider the success of their energy reporting requirement to be tied closely to the addition of complementary programs, such as mandatory (or incentivized) energy audits, retro-commissioning and energy retrofits. For example, New York City and San Francisco 2 require energy audits to be undertaken every 5-0 years. Energy audits allow owners to identify specific opportunities for reducing their energy consumption. An energy reporting requirement will motivate building owners to want to reduce their consumption, while energy audits will show them how. Toronto already has programs that would complement an energy reporting requirement by-law to increase the overall effectiveness of Toronto s conservation offerings for building owners. These include incentive programs for energy audits and improvements provided by the Ontario Power Authority, through Toronto Hydro, and by Enbridge Gas; programs through the City s Environment and Energy division and Tower Renewal Office such as local improvement charge (LIC) financing for energy retrofits; the Toronto Atmospheric Fund s (TAF s) Energy Savings Performance Agreement (ESPA) program; the Tower Renewal Office s STEP program (a site assessment framework); and the Toronto Energy Efficiency Office s Better Buildings Partnership. Together, these programs provide resources, technical guidance and financial assistance for the completion of energy audits, better financing options for buildings and residential owners that want to invest in energy retrofits, and financial incentive for buildings seeking to install energy retrofits. As the City receives more information about the energy use in Toronto s building stock via an energy reporting requirement it will become apparent which sectors are the poorest performers, so programs or incentives can be developed or modified by the City or in partnership with local utilities or other third parties to specifically target these sectors. The costs of improving building performance will be less daunting for building owners and managers as a result of these programs. City of Toronto 4Y Page 5

8 4 LESSONS LEARNED FROM OTHER JURISDICTIONS There are now nine cities and two states in the United States that have mandatory benchmarking requirements 8 : Cities: States: New York City Washington Seattle California San Francisco Boston Chicago Washington D.C. Philadelphia Minneapolis Austin Researching these jurisdictions and interviewing program staff have revealed best practices and trends related to program format, scope, methods of communication, and tools used. 4. Energy Star Portfolio Manager is the Tool Used by All Existing U.S. Programs Reporting building energy performance requires a tool that facilitates information collection, performance calculation, and disclosure. The tool must, at a minimum: Collect building information (e.g. size, use, location) Collect energy and water use information (e.g. electricity use, natural gas use, district energy use) Calculate energy and water performance Disclose individual property performance (share results) Facilitate bulk performance disclosure at the city scale Be publically accessible to owners of all building types within the program scope Ideally, the tool will also: Be economical to access Be easy to use Receive automated data updates (e.g. monthly consumption from energy and water utilities) Report performance on a level playing field regardless of variations in facility size, type, and usage characteristics (normalization) Transparently communicate how performance is calculated Aggregate data for in-depth analysis (e.g. by municipality or government agency) Many building energy benchmarking tools exist that satisfy some or many of these criteria. However, Energy Star Portfolio Manager is the one and only reporting tool that all existing U.S. programs have used. It meets all of the criteria above. City of Toronto 4Y Page 6

9 Energy Star Portfolio Manager is Canada s national energy benchmarking tool. It is developed by the United States Environmental Protection Agency with an intended public purpose, and is licensed for use in Canada by Natural Resources Canada 3. It is free for use by the City of Toronto, and by any building owner(s) to use to collect information and calculate performance. It is also well documented and transparent in its calculation method. Natural Resources Canada summarizes the value of this tool on their webpage Why Energy Star Portfolio Manager? 4 Portfolio Manager is becoming more widely used in the U.S. and Canadian market. It is the technical backbone for voluntary green building programs including the Canada Green Building Council s LEED Canada for Existing Buildings: Operations & Maintenance certification system, as well as Toronto s Race to Reduce energy efficiency program. Building data entry is relatively simple, and data sharing is built-in, making reporting and data analysis easy at any scale, from individual property to whole city. Portfolio Manager also allows many different types of energy use to be included such as electricity, natural gas, district steam, and district chilled water. Water use can also be tracked through Portfolio Manager 5. Any property can use Portfolio Manager. Some property types receive a performance rating in the form of a score (0 to 00) which accounts for variations in building size, type, and usage characteristics (the score is normalized ). At the time this report was written, properties that receive a score include Canadian office buildings, K-2 schools, and hospitals. Properties that do not receive a 0-to-00 score (such as multifamily residential buildings and some industrial buildings) instead receive an Energy Use Intensity rating (energy used per square foot of building area). In this case performance is normalized based on building size, but not by building type or usage characteristics. Natural Resources Canada intends to add scores for other building types on a progressive basis over several years. In most other respects including inputs, outputs, and functionality, the Canadian and U.S. version of Energy Star are similar 4. Portfolio Manager accepts automated data entry (e.g. by energy and water utilities) when available by the utility provider. Local utilities are encouraged to provide aggregated whole building energy use data, with groups including the Data Access and Transparency Alliance (U.S.), and the Green Button Data initiative (in both Ontario and the U.S.). Where automated data entry is available, the owner only has to verify the supplied data before submitting energy benchmarking results to the city each year. While Energy Star Portfolio Manager is the most obvious tool of choice for a Toronto ERR, other tools exist. These include: The Real Property Association of Canada s Energy Benchmarking Program offers a free online Canadian energy benchmarking tool specifically for office buildings. Lawrence Berkeley National Laboratory Energy IQ program (U.S.) benchmarks energy use as well as building features. California s Cal-Arch program (U.S.) focuses on building efficiency of California buildings. Metrix (Abraxas Energy Consulting, U.S.) offers a paid software utility accounting system for use by energy managers of buildings and portfolios. City of Toronto 4Y Page 7

10 4.2 Stakeholder Engagement Directors of U.S. benchmarking programs have found that effective communication with building owners and affected stakeholders is important in establishing a program 7. This communication requires time both during the development of the program or by-law, and during its implementation. Both New York City and Seattle took time, during program development, to receive stakeholder feedback. Stakeholders included building owners and managers, environmental groups, benchmarking service providers, energy managers, city employees, and the general public. Addressing stakeholder concerns helps manage any unfavorable response or delays. For example New York City originally proposed mandatory building retrofits as part of their ordinance but after overwhelming negative building-owner feedback, the start date of the program was delayed and the requirement was removed from the ordinance 7. These two cities spent between one and three years between passing an ordinance and requiring the first benchmarking submission. This time period was used to inform building owners of the program and how to comply, via letter mail, , a media campaign, and numerous educational events for building owners, managers, and service providers. New York City and Seattle compliance rates are among the highest in the U.S., 84% 4 and 93% 6 respectively. In these cities, outreach efforts also included a help-desk/call-centre to help building owners learn about the ordinance and how to comply. These call centres provided timely resolution to any problems that building owners experienced as they complied with the energy reporting requirement. Call centres in New York City and Seattle received an average of 600 to 700 calls during the month before a reporting deadline Program Scope 4.3. Budgets and Staffing Usually Requires Only Minor Investment The jurisdictions that we contacted were not able to share specific budget information. While the costs were suggested to vary substantially by jurisdiction (depending on program scale, but also the amount of partner support received) most were able to say they considered their costs minor. Start-up costs were anecdotally suggested (in interview with Boston and Chicago program representatives) to be more substantial than on-going costs, because most communication, stakeholder outreach programs, training programs, and media campaigns took place at the outset of the program. Jurisdictions were able to keep the cost to the city low by partnering with other levels of government and supportive environmental organizations. Some state governments provided funding. Interested organizations, environmental organizations and utilities hosted learning sessions and released how-to guides and other instructional publications. Staffing requirements vary by city size and the number of buildings in the program, most often requiring one or two full-time employees in the first year, or up to five employees in the largest jurisdiction 8. The investment in staff and resources tended to decline after the program is developed, initiated, communicated effectively, and the first reporting year is complete. City of Toronto 4Y Page 8

11 Exact program costs and staffing needs were difficult to obtain either through research or through conversations with the other U.S. jurisdictions; the only city willing to disclose the information was Boston who had one dedicated employee during program implementation for the first 6-8 months full time, after the initial implementation his involvement was reduced to part time. The Boston city program has a yearly operating budget in the range of $00, By-Law Scope is Determined by Building Type, Size, Reporting Method, and Timeline Several inclusion criteria determine the scope of the by-law, the impact it can have, and the effort it requires. The timeline for program roll-out will impact results in the first few years. Building Types Included The two main categories of buildings that are most often required to comply with benchmarking by-laws are commercial/industrial and multi-unit residential buildings (MURBs). These are the building types included in the scope of existing programs in Boston, Washington DC, New York City, Chicago and Seattle 8. Multi-unit residential buildings have been successfully included in several existing programs, but will present distinct challenges: Their utility consumption may be metered on a suite-by-suite basis by the utility, which requires aggregation to arrive at whole-building numbers. Gathering utility data from private residences must comply with privacy regulations. About 75 to 90% of Ontario multi-unit residential buildings are bulk-metered 9 (meaning 0-25% are metered on a suite-by-suite basis). In some cases local privacy laws limit access to data for MURBs and other buildings where multiple occupants pay electricity directly to the local utility. For example, in California the building owner must obtain written permission from each tenant before aggregated data is provided by the utility 20. This can be especially onerous for any owners of MURBs who have no main building meter and only individual suite metering. A summary of building quantities and floor areas by building category in Toronto is found in the table below (summarized from the Toronto Municipal Property Assessment Corporation (MPAC) database). Single-family residential buildings and some types of industrial buildings will likely be excluded from the scope of a Toronto program. Building Category Total Gross Building Area (ft2) Number of buildings Commercial (Commercial) Commercial (Industrial) Residential Multifamily Residential Single Family (excluded) Industrial (excluded) Grand Total 47,953,035 84,852,88 320,722,67 724,548,863 57,55,835,435,232,78 8,563 5,602 6,2 426,958, ,746 City of Toronto 4Y Page 9

12 Greater detail on which building types in Toronto are included in each of these categories can be found in appendix D. Building Sizes Included All existing energy reporting requirements limit program scope by requiring compliance only from buildings greater than a specified size. Size is usually measured by floor area, but for multifamily residential buildings some programs measure by the number of residential units in the building. Existing program managers interviewed said they found that owners of larger buildings are generally easier to contact for outreach and education. They are more likely to be members of professional associations, or to be managed by a mid-size or large management company, enabling clear communication channels 8. According to the Institute for Market Transformation, The vast majority of smaller and mid-size building owners and managers that may be impacted by benchmarking policy have little or no experience with the process. 2 Seattle increased their program minimum building size from 0,000 ft 2 to 20,000 ft 2 8 after finding some owners of smaller buildings were more difficult to contact, and were less likely to have computer access with which to access Portfolio Manager and submit their benchmarking information 7. In Boston the initiallyproposed threshold of 25,000ft 2 was increased to 35,000ft 2 after challenges related to small building participation 8. The minimum building size in existing programs ranges between 20,000 ft 2 and 50,000 ft 2. Some jurisdictions, including Boston and Washington D.C., have programs which capture -3% of building stock, corresponding to 40-50% of gross floor area across the jurisdiction. A detailed breakdown of Toronto s building quantity and floor area by size range (e.g.: buildings over 00,000 ft 2 ) can be found in appendix D. Reporting Method Required Reporting can occur in several forms. Disclosure to the local government allows progress to be tracked and supports development of future government programs. Government disclosure is required by most programs, including Boston, Washington DC, New York City, San Francisco and Philadelphia. Washington State does not require local government disclosure 8. Public disclosure (on a public website, for example) introduces market forces to create competition between buildings, thought to cause the most impactful change. This mechanism has already been used in Toronto to drive energy use reduction, where the voluntary Race to Reduce program boasted a 9% energy use reduction over two years in participating buildings 9. With public disclosure, buyers and sellers consider energy and water performance long before a transaction takes place. Public disclosure is required by most existing programs, including Boston, Washington DC, New York City, San Francisco and Philadelphia. Austin, California, Seattle and Washington State do not require public disclosure. 8 Transactional or tenant disclosure allows information to be exchanged at specific times, for example at point of sale, lease, financing, or during tenancy. Austin, California, Seattle and Washington State require transactional disclosure, as opposed to public disclosure 8. City of Toronto 4Y Page 0

13 Program Roll-Out Timeline Implementing an energy reporting requirement will involve several phases including: Feasibility investigation (now underway) Engagement and consultation with affected stakeholders regarding the draft by-law, inclusion criteria, etc. By-law development By-law approval Outreach and communication with building owners (requiring between one and three years in U.S. jurisdictions) Phased roll-out, often starting with municipal buildings before addressing larger private buildings, medium-sized buildings, and eventually smaller buildings Each U.S. jurisdiction rolled out their program differently to address the characteristics of their building stock. San Francisco s program phase-in required buildings over 50,000 ft 2 to comply in the first year, buildings between 25,000 ft 2 and 50,000 ft 2 to comply in the second year, and all buildings over 0,000 ft 2 to comply in the third year. A similar multi-year roll-out timeline was also applied in Seattle and Boston. Only Boston rolled out non-residential building compliance earlier than multi-residential building compliance. All other jurisdictions rolled out all building types at the same time. Several jurisdictions actively enforce compliance, for example by issuing written warnings (Minneapolis, San Francisco), providing public notice of noncompliance (San Francisco), and/or issuing fines (San Francisco, Philadelphia, Austin, Washington DC, Chicago, New York City, Seattle, and Boston). 8 5 POSSIBLE IMPLEMENTATION SCENARIOS Implementation scenarios were modeled, based on inclusion criteria determined in collaboration with City staff and benefits were quantified over a 20-year period. For each scenario, we evaluated: Market penetration Potential to contribute to the City s energy conservation targets Potential to contribute to the City s target for greenhouse gas emissions reductions Financial impacts Social impacts Staffing and budgetary implications to the City associated with the program Three scenarios were analyzed: Scenario A: reasonable program scope and success. Scenario B: reduced program scope and success. Scenario C - Business as usual: no mandatory energy reporting requirement by-law is passed, and the city continues to grow. City of Toronto 4Y Page

14 Table below outlines the criteria that differentiate Scenario A from Scenario B. They include factors over which the City will have influence during the design and implementation of the program. Table Criteria Scenario A Scenario B Minimum Building Size 25,000 ft 2 50,000 ft 2 Program Compliance 95% 75% Program Effectiveness (Percent Energy Saved) 2.4% each year.2% each year Program Phase-In Schedule 206 (partial) 207 (full) 206 (partial) 207 (full) Minimum building size and program compliance rates reflect the range represented by U.S. jurisdictions we researched (see sections above, Building Sizes Included ). In Scenario A, the program compliance rate reflects benchmarking effectiveness as reported by Energy Star Portfolio Manager (see section below, Key Assumptions ). The program phase-in schedule was chosen to reflect a 2-year program development timeline, in the middle of the to 3 year timeline seen in several U.S. jurisdictions (see section above, Program Roll- Out Timeline ) 6 KEY ASSUMPTIONS A full table of assumptions applied in this scenario analysis is provided in appendix B. The assumptions of greatest relevance or uncertainty are: Total Building Area in Toronto Today The City of Toronto s Municipal Property Assessment (MPAC) database was used to estimate the number of buildings, total building floor area, and energy use for each market sector. A data quality analysis identified that some (perhaps many) addresses appear to under-report building floor area. For example, several apartment buildings of ten stories or more reported total floor area under,000 ft 2 (buildings of this size are likely to be closer to 00,000 ft 2 in size). This likely leads to an under-representation in this report of the total size of buildings in each market sector in Toronto, and number of buildings that will be included in a benchmarking program. Several alternate sources of data were considered and dismissed for having missing references. However, one such source 22 predicts around twice the floor area of buildings in Toronto, vs. MPAC. Should the actual building sector be twice as large as represented by MPAC, the impact and benefit of a benchmarking program could be twice that reported here. Total Electricity Used by Buildings in Toronto Today The City of Toronto s Energy Mapping Report (April 204) reports electricity and natural gas use, but also stated that discrepancies in means, medians, and typical Ontario averages suggests that the Toronto electricity intensity dataset for high rise commercial office buildings is not reliable at this time, and There are many anomalies in the electricity and gross floor area data for this building type, therefore the Toronto electricity intensity dataset for high rise residential condominium buildings is not reliable at this time. We therefore applied a typical Ontario electricity intensity value (5.2 kwh/ft 2 ) 23 and multiplied this by the gross floor area of commercial/industrial buildings in Toronto (from the City of Toronto MPAC database) to determine the total electricity used by commercial/industrial buildings in Toronto today. As noted above, since MPAC data may under-report building floor area, this may underestimate total electricity & natural gas used by buildings in Toronto today. City of Toronto 4Y Page 2

15 Total Natural Gas Used by Buildings in Toronto Today The City of Toronto s Energy Mapping Report (April 204) reports electricity and natural gas use. However, this report states the natural gas used by commercial buildings includes residential (condominium buildings) and institutional facilities. We do not know of an appropriate, industry-recognized natural gas use intensity estimate (m 3 /ft 2 ) for non-residential buildings, however, the value from the Energy Mapping Report is about three times as high as we would expect, based on our own database of building energy use containing data from nearly,000 buildings. As such, we estimate that the total natural gas used by commercial/industrial buildings in Toronto today is /3 rd of the value stated in the City of Toronto s Energy Mapping Report, a final value of 480 million m3 of gas used each year. As noted above, since MPAC data may under-report building floor area, this may underestimate total electricity & natural gas used by buildings in Toronto today. Program Effectiveness According to Energy Star Portfolio Manager s Data Trends: Benchmarking and Energy Savings report (Oct ), buildings that benchmark energy use consume an average 2.4% less energy each year, and 7% less after the four years observed. We used this finding as the basis for our estimate of the energy savings generated by a MEBD program (2.4% savings annually) in Scenario A, and discounted this by half in the Scenario B. In each case, we added a conservative limit to program effectiveness, described below. Program Effectiveness Limit While energy consumption savings are expected each year, we expect that the effectiveness of energy benchmarking will reach an ultimate limit after several years, and that continued benchmarking beyond this limit will serve to maintain the ultimate savings level, but not further improve it. Since we have found no data to quantify an ultimate program effectiveness limit, for all scenarios we estimate this limit it to be 5% energy savings (about double the 7% effectiveness of benchmarking after four years reported by Energy Star Portfolio Manager). Real Estate Growth in Toronto For all scenarios, real estate growth in Toronto (and associated building energy use) was assumed to follow the population growth rate of.5% / year (based on Statistics Canada 202/203). This is in the range found in City of Toronto s Profile Toronto bulletin (July 204), which showed an estimated residential real estate growth of about 0.9% to 3.5% and a commercial growth of about 2%. Utility Costs and Growth An electricity rate of $0. /kwh and natural gas rate of $0.25 /m 3 are taken from the City of Toronto Energy & Emissions Inventory & Mapping Report (April 204) 6. The water rate of $2.96 /m3 was taken from the City of Toronto water website. An electricity rate increase (excluding inflation) of 7% next year and % thereafter were based on Ontario Power Authority s Long Term Energy Plan. Natural gas rate was assumed to have no increase (excluding inflation). Water rates were assumed to increase by 6% each year (excluding inflation) based on city council approvals in late 203, as reported by the Toronto Star. See Appendix B for a complete list of inputs and assumptions, including: Program effectiveness and program effectiveness limit Program starting year Toronto real estate growth rate Number of buildings and gross floor area in Toronto (commercial/industrial, MURB, and combined) City of Toronto 4Y Page 3

16 Number of buildings above 25,000 ft 2 ; and above 50,000 ft 2 (commercial/industrial, MURB, and combined) Total electricity use; gas use; and water use in Toronto (commercial/industrial, MURB, and combined) Electricity, natural gas, and water utility cost rates and escalation over time Energy use associated with water consumption Average peak electrical power associated with annual electrical consumption Carbon intensity of electricity, and of natural gas Rate of job creation due to energy efficiency 7 IMPACT OF AN ENERGY REPORTING REQUIREMENT IN TORONTO Implementing an energy reporting requirement in Toronto starting in 207 could save a cumulative 2 to 39 Million emwh of energy over 20 years when compared to business as usual. Program results are summarized in table 2 below. Table 2: Program Results, by 2035 Scenario A Scenario B Business as Usual # Buildings Enrolled (#) 5,000 3,000 - Building Gross Floor Area Enrolled (ft2) 620 Million ft Million ft 2 - Cumulative Electricity Savings (MWh) 3 Million MWh 7. Million MWh - Cumulative Natural Gas Savings (m3 gas) 2.4 Billion m 3.3 Billion m 3 - Cumulative Energy Savings (emwh) 39 Million emwh 2 Million emwh - Cumulative Water Savings (m3 water) Cumulative Greenhouse Gas Avoided (tons CO2e) 70 Million m 3 99 Million m Million tons(co2e) 3.3 Million tons(co2e) - Cumulative Utility Cost Savings ($) $3.4 Billion $.9 Billion - Cumulative Employment Generated (person-years employment) Peak Electric Power Savings (megawatts) 8,000 personyears 0,000 person-years - 90 MW 30 MW - 78,000 to 223,000 tonnes of annual CO2 reduction could be achieved by 2020, contributing about 3% to 0% of Toronto s 2020 GHG reduction goal of 30% below 990 levels (about 2.3 Million tonnes less than 20 GHG levels, reported in 204). 24 These results are founded on data with known quality concerns (see key assumptions above), and may under-represent the program impact and benefit, which could be twice that reported here. Further results, as well as methodology, are described in the following sections, including: Program scale and market penetration Energy and water conservation Greenhouse gas reduction City of Toronto 4Y Page 4

17 Financial impact Staffing and budget requirements 7. Program Scale and Market Penetration The following figures show the number of buildings and the total gross floor area that would be affected by the program. Multi-unit residential buildings (MURBs) comprise nearly half of the buildings in the program, and nearly half of the energy savings potential as well. In Scenario A, up to 2% of commercial/industrial and MURB buildings and 79% of building gross floor area (GFA) is represented as seen in Figure below. In Scenario B, up to 7% of buildings and 69% of GFA is represented. Over half of overall Program impact MURBs being included in the program. Figure : Impact of MURB vs. Commercial/Industrial Sector Within 20 years, over one half billion square feet of real estate could be engaged in energy benchmarking and conservation across nearly six thousand properties in Toronto, as seen in Figure 2 and Figure 3. Figure 2: Market Penetration (ft2 building area) City of Toronto 4Y Page 5

18 Figure 3: Market Penetration (number of buildings) Methodology: Toronto building stock, filtered by building size (based on scenario), with annual city growth rate applied. 7.2 Energy and Water Conservation The figures below show the amount of electricity and natural gas that could be saved each year by implementing a benchmarking program. Annual electricity savings could reach 67 to 492 thousand MWh by Over the next 20 years a cumulative savings of 7 to 3 Million MWh could be achieved. Yearly savings can be seen in Figure 4 below. Figure 4: Annual Electricity Savings City of Toronto 4Y Page 6

19 Annual natural gas savings follow a similar trend. Annual savings could reach 3 Million to 88 Million m 3 of natural gas by 2020, and a cumulative.3 to 2.4 billion m 3 over the next 20 years. Yearly savings can be seen in Figure 5 below. Figure 5: Annual Natural Gas Savings Water savings could reach 2 Million to 5 Million m 3 per year by 2020, a cumulative 00 Million to 70 Million m 3 over the next 20 years. Yearly savings can be seen in Figure 6 below. Figure 6: Annual Domestic Water Savings With an energy content of 0.64 ekwh per m 3 of natural gas, and 0.55 ekwh per m 3 of water, combined total annual energy savings could reach 0.5 Million to.4 Million emwh by 2020, a cumulative 2 Million to 39 Million emwh over the next 20 years. Figure 7 below shows the yearly savings from all sources combined. City of Toronto 4Y Page 7

20 Figure 7: Annual Energy Savings (Electricity & Gas) While a mandatory energy benchmarking program will reduce energy use, population growth will continue to cause real estate volume and energy use to rise. Energy savings from this program may be great enough to balance population growth until at least The program is expected to save 0% of Toronto s commercial/industrial and multifamily building energy use after 20 years. Yearly energy use can be seen in Figure 8 below. Figure 8: Total Energy Used Methodology: Toronto electricity, natural gas, and water use savings based on program effectiveness (up to the program effectiveness limit), and only for the compliant participating buildings (based on assumed compliance rate, building size, and program roll-out timeline), with annual city growth rate applied. City of Toronto 4Y Page 8

21 Reduced electricity consumption can also lead to reduced demand. Peak power savings could be as great as 93 MW, as seen in Figure 9 below, helping alleviate the city s already stressed supply infrastructure, and potentially reducing the magnitude of ratepayer dollars needed to upgrade Toronto s power grid in the future which could help mediate utility rate increases over time. Figure 9: Peak Power Demand Savings Methodology: Based on electricity saved, then multiplying by the average peak electrical power associated with annual electrical consumption, with annual city growth rate applied. 7.3 Greenhouse Gas Emissions Reductions The following figure shows the greenhouse gas (GHG) emissions that could be avoided by implementing a benchmarking program. 78,000 to 223,000 equivalent tonnes of CO2 could be avoided annually by 2020, contributing about 3% to 0% of Toronto s 2020 GHG reduction goal of 30% below 990 levels (about 2.3 Million tonnes less than 20 GHG levels reported in 204). Between 3.3 Million and 6.0 Million equivalent tonnes of CO2 could be avoided cumulatively over the next 20 years. Figure 0 below shows the annual GHG savings. City of Toronto 4Y Page 9

22 Figure 0: Annual GHG Savings Methodology: Based on electricity saved, natural gas saved, and electricity saved associated with water saved, then applying GHG intensities to electricity and natural gas savings, with annual city growth rate applied. 7.4 Financial Impact Energy savings lead to financial savings when building owners and occupants see reductions in their monthly utility bills. Tax payers will also carry less burden when infrastructure upgrades become less intensive due to reduced energy consumption throughout the city. By 2020 utility bill saving of $38 M to 08 M per year are expected, as seen in Figure below. Additional savings will escalate with rising utility prices and decreasing consumption, saving a cumulative $.9 Billion to $3.4 Billion over the next 20 years, as seen in Figure below. City of Toronto 4Y Page 20

23 Figure : Annual Cost Savings ($) Methodology: Based on electricity, natural gas, and water saved, then applying utility cost rates to each of these utilities (with utility cost rates escalating over time, and with annual city growth rate applied). 7.5 Social Impact Energy savings lead to financial savings, and financial savings lead to jobs.. Based on a report from the Institute for Market Transformation, approximately 5.2 person-years of employment can be created for every $ million saved on utility bills. Section 2 of this report describes in more detail the types of jobs created The number of jobs created in the scenarios modeled can also be seen below. By 2020, 20 to 577 jobs could be created, generating a cumulative 0,000 to 8,000 person-years of employment over 20 years, as seen in Figure 2 below. City of Toronto 4Y Page 2

24 Figure 2: Jobs Created Methodology: Based on costs saved, then multiplying by the person-years of employment generated per $ Million saved on utility bills, with annual city growth rate applied. 7.6 Staffing And Budget Requirements From conversations with other jurisdictions with established energy reporting requirements, the costs and staffing requirements to implement a program like this are fairly modest, often with two or fewer full-timeequivalent employees. For example, typical costs for running a help center for a year ranged from $50,000 to $00,000, for staffing needs in the range of one to three full time employees 7. The help centre was identified as a major cost by several jurisdictions. Seattle s technical support group averaged.75 FTEs in We have estimated an annual cost (beyond staffing) of $00,000 per year, conservatively assuming no reduction over time, since data is not available on the rate or magnitude of the reduction anecdotally indicated to exist. The actual number of staff required depends primarily on the education, outreach, and support centres provided. Other jurisdictions have reported that education and support are important to program success and well worth the investment required. City of Toronto 4Y Page 22

25 8 CONCLUSIONS An energy reporting requirement has the potential to dramatically change the way energy use in buildings is viewed and managed in Toronto. This program could be a foundational component of the energy use reduction plan needed to reach the environmental targets the city of Toronto has committed to reaching. Toronto is close to its goal to reduce GHG emissions 30% below 990 levels by 2020 and an energy reporting requirement will help the city get the rest of the way there. Supplementing the research conducted on other successful cities that have implemented this type of program with quantitative values that are specific to Toronto has shown that the expected benefits from a bylaw of this type are attractive and far exceed the investment required. A successful city-wide energy and water reporting requirement by-law has the potential over the next 20 years to cumulatively avoid over 6 Million tonnes of equivalent CO2 greenhouse gas, nearly 40 Million emwh of electricity and natural gas use, while saving over $3 Billion for building owners, occupants, and tax-payers and generating 8,000 person-years of employment. While an energy reporting requirement will reduce energy use, population growth will continue to cause real estate volume and energy use to rise. Energy savings from this program may be great enough to balance population growth until at least The program is expected to save 0% of Toronto s commercial/industrial and multifamily building energy use after 20 years. These results are founded on data with known quality concerns (see key assumptions above), and may under-represent the program impact and benefit, which could be twice that reported here. The program s success relies on a wide scope of influence impacting many large buildings, easy-to-access data and effective education and compliance support. The sooner this program can be implemented the sooner the Toronto will start to see the benefits it provides. Yours very truly, HALSALL ASSOCIATES A Parsons Brinckerhoff Company Eric Chisholm, B.ScE., CEM, LEED AP Technical Specialist Jason Manikel, P.Eng., CBCP, LEED AP Project Principal 4Y EnergyBenchmark.rep03.rev02 City of Toronto 4Y Page 23

26 Appendix A Existing Benchmarking Programs in the United States

27 APPENDIX A: EXISTING BENCHMARKING PROGRAMS IN THE UNITED STATES A. Summary of Existing Programs The first city to pass a benchmarking law was Washington DC in July 2008 when they passed an ordinance that requires buildings to disclose energy use to the city who will then disclose it publically. Washington DC was quickly followed by Austin, Texas later in 2008, New York City which passed Local Law 84 in 2009 and several other jurisdictions in the following years. The three earliest reporting deadlines belong to New York City, Seattle, and San Francisco who all required benchmarking starting in 20. These cities have all released reports on the performance of their buildings and those with public disclosure have their information available on their websites. There are now nine cities and two states in the United States that have mandatory benchmarking requirements. These jurisdictions all require energy data to be submitted through Portfolio Manager but the degree of disclosure varies from full public disclosure of all submitted information to disclosure to the jurisdiction and release of information during the sale of a building only. The figure below, provided by the Institute for Market Transformation, shows the level of mandatory energy benchmarking and disclosure in various regions across the U.S. City of Toronto 4Y Page A

28 The most established jurisdictions in terms of compliance and length of program are New York City and Seattle with compliance rates of 84% 4 and 93% respectively. Both of these jurisdictions have released reports that summarize the data collected and present conclusions and recommendations based on that information. According to New York City s PlanNYC September 204 report, Three years of benchmarking New York City buildings shows that city-wide reported energy use per building has been reduced. 4 An interview with a Washington D.C. program representative indicated that data quality is an important consideration (manual data entry creates the risk of misinterpretation or mistyped values, both of which have been noted to take place in some cases). The benefit of Energy Star Portfolio Manager s Data Quality Checker was highlighted to help address this challenge, though there is no method yet available for a jurisdiction to verify this checker has been used on submitted data. This report focused on the benchmarking programs in four U.S. cities: New York City; Seattle; San Francisco; and Boston. The first three of these cities have established programs with a wealth of data available including best practices, challenges, and building data available. Boston was chosen because it is a relatively new program whose first compliance deadline is September 5, 204 which was pushed back from May 5, 204. This program will be able to provide more recent information on the kinds of challenges Toronto could expect to face and what best practices from established programs are the most effective. A.2 Successes After three years of mandatory benchmarking in New York City, Seattle, and San Francisco as well as the implementation of several other programs in the intervening years many best practices and success stories have come to light. These successes were be studied and the insights they provide will be used to develop a robust and successful program that can be implemented in Toronto. The most successful mandatory benchmarking programs can be found in jurisdictions with the best outreach programs. It is important that first and foremost the building owners affected by the ordinance know about it and have access to the training resources that will allow them to comply with the requirement. When implementing its benchmarking program New York City employed a multi-tiered outreach program that involved letters sent to building owners, mass s to large building associations for dissemination to their members, an extensive advertising campaign highlighting benchmarking requirements and the overarching PlaNYC environmental program, outreach events open to the public hosted by the city, and a call centre where building owners could get one-on-one technical assistance with Portfolio Manager. These measures helped New York City achieve the highest initial compliance rate of the three early adopting jurisdictions at 84%. Seattle s initial compliance was lower at 3% but through increased outreach and better access to resources for building owners they have raised their compliance to 93% as of January, 204, the highest in the United States. Their initial outreach efforts involved a media campaign, open house events for local trade and professional organizations, as well as a call centre similar to the one in New York City. These efforts fell short when it came to notifying the owners of smaller buildings that do not belong to large building associations or regularly read publications from their sector. Along with their improved outreach efforts the automatic entry of building energy use into Portfolio manager by Seattle utilities helped skyrocket the compliance to its current level of 93% compliance. City of Toronto 4Y Page A2

29 Of all the outreach techniques and programs implemented, call centres have proven to be one of the most effective at both teaching the technical aspects of benchmarking and as a general resource on compliance deadlines and law requirements. New York City and Seattle both staff their call centres with students from local universities or colleges who are trained in the technical aspects of Portfolio Manager, the requirements of the benchmarking law, and customer service techniques. These call centres become especially important leading up to submission deadlines for benchmarking and are a valuable resource for building owners as well as energy service companies that are often hired by building owners to complete benchmarking requirements on their behalf. Another important factor that often dictates the degree of compliance is the ease with which building owners can get access to whole building energy data that they need to input into Portfolio Manager. In most cases the local utilities have offered to provide aggregated whole building data to owners who are required to benchmark, in other cases the jurisdiction has specified in their ordinance that utilities are required to supply whole building data. Some utilities offer this service for free while others require a small payment to make this service available. In several cases, Seattle and San Francisco in particular, the utility companies are able to upload building energy use data to Portfolio Manager for the building owner. This system is best implemented in Seattle where privacy laws are less stringent than in San Francisco where the utility requires consent forms from tenants to release their energy use data to the building owner. In most jurisdictions the budget and staffing requirements are quite modest. The direct cost to the city for the implementation of the program is often alleviated by partnerships with regional government and other organizations. The local BOMA chapter, USGBC, and EPA are some of the organizations that regularly help fund benchmarking initiatives in U.S. cities. Many local utilities also have their own energy reduction targets and this program helps them realize their own goals so they are often willing to provide help in the form of aggregated building energy use data or other benchmarking help sessions. San Francisco s utility provider PG&E has partnered with the city to offer a wide array of educational material on how to use Portfolio Manager to benchmark. They host training sessions and webinars and post detailed as well as step by step guides to help building owners. A.3 Challenges The implementation of these programs is not without its challenges, there is a vast amount of data that needs to be collected and organized before the benchmarking can even begin. The city needs to create a database of all the buildings in the city that are required to benchmark which is often compiled from tax records that are generally not as detailed as would be required for this exercise. The most common problem with getting building counts from tax data is when there is more than one building on a single tax lot. A great deal of time has to be spent before buildings are asked to benchmark to create this master list of all buildings that meet the benchmarking criteria. As the most successful jurisdictions were the ones with the best communication and outreach programs the less successful are the ones that did not have as effective initial outreach. In some cases cities did not carry enough time in their roll-out schedule to ensure that all building owners were aware of the program requirements and had been able to learn how to use Portfolio Manager or how to get their building energy use data from the local utility. In these cities there was quite a bit of pushback from building owners and in many cases the initial reporting deadline was extended for the first year of benchmarking and their initial compliance rates were quite low. Both Seattle and San Francisco had low initial compliance rates of 3% and 44% respectively. City of Toronto 4Y Page A3

30 In many cases the buildings that were the most difficult to reach with sufficient information were the smaller buildings. These were owned by an individual with no other properties and no established professional network connecting them to other building owners. This was the case for some buildings in Seattle; the only notice about the program they received was a letter from the city informing them of the upcoming reporting deadline. They felt this was not enough notice and they pushed to have the deadline moved back. In some extreme cases there were small building owners in Seattle who did not own a computer or have an address making compliance via Portfolio Manager unfeasible. Another challenge building owners tend to face is getting access to whole building energy data. In most jurisdictions the local utilities are willing to provide aggregated whole building data to owners on a yearly basis but in some cases there are issues when tenants have separate sub-meters and releasing this information to the owner would be a breach of privacy. Other utilities are able to provide aggregated data but at a price; Consolidated Edison in New York City charges $02.50 per building for aggregated energy data. San Francisco s utility provider, PG&E, is able to upload energy data automatically into Portfolio Manager for building owners as long as they get release forms from each of their tenants with sub-meters. This process can prove to be fairly time consuming for building owners especially when there are many sub-metered tenants in the building; in Seattle their privacy laws are less stringent and utilities can release aggregated building energy data and upload it automatically to Portfolio Manager as long as there are more than four tenants with sub-metering in the building. A.4 Interaction with Complementary Programs and Policies A.4. Other Cities Program and Policy Interactions Most cities that have passed an energy reporting requirement ordinance have done so as an action to support their energy use or GHG emission reduction targets. This program is a tool that is being used to reduce the amount of energy existing buildings are using for their ongoing operations. In order to complement that goal many cities have also passed ordinances that complement benchmarking such as mandatory energy audits and retro-commissioning. These mandatory measure are required regularly every set number of years. For example New York City requires an energy audit and retro-commissioning to be completed every ten years. Requiring energy audits will show buildings where they are using the most energy and what measures can be taken to reduce the amount of energy they are using. These measures can include changes to lighting schedules to better match occupancy or replacing inefficient equipment with models that use much less energy. Combined with benchmarking these actions can drastically improve the performance of a building. Other programs that are being used by other cities to complement benchmarking include incentives for people who wish to perform energy audits or install more energy efficient equipment. Some of these incentives are being offered by state and federal level government organizations that are dedicated to increasing energy efficiency in the U.S. As these programs are complementary they do not have any official links to the jurisdiction s benchmarking initiatives, they facilitate the improvement of the buildings energy systems but they are not officially part of the benchmarking program. City of Toronto 4Y Page A4

31 In general, however, there has not yet been enough data collected on the building stock in each of the benchmarking jurisdictions to start tailoring incentive programs to either building sectors or sizes that perform poorer than others. It is anticipated that as information becomes more reliable and available these kinds of programs will be implemented. City of Toronto 4Y Page A5

32 Appendix B Key Model Inputs and Assumptions

33 APPENDIX B: MODEL INPUTS AND ASSUMPTIONS Assumptions and Inputs Value Basis Program Effectiveness (additional % savings / year) Program Effectiveness Cap (maximum % savings achievable in future year) 2.4% (.2% scenario B) Energy Star Portfolio Manager Data Trends: Benchmarking and Energy Savings (Oct 202). 5% Halsall assumption: Double the 7% effectiveness of benchmarking after 4 years (Energy Star Portfolio Manager Data Trends: Benchmarking and Energy Savings (Oct 202)). Program Starting year 207 Assumes a year engagement process (205) and a year bylaw development and approval (206) process, then the first reporting deadline for some buildings in 207, and for all buildings in 208. Toronto real estate growth rate (%) # in Toronto, Commercial/Industrial.5% / year 202/203 population growth rate from Statistics Canada. 24,65 buildings City of Toronto MPAC database: all buildings of structure type "commercial" and "industrial". See appendix D for greater detail. Future numbers increase by the growth factor of Toronto each year. # in Toronto, MURB 6,2 buildings City of Toronto MPAC database: Select buildings of structure type "residential". See appendix D for greater detail. Multiple MPAC IDs with the same municipal address were assumed to exist in the same structure and were grouped as one structure, and the total area of IDs was combined. # Commercial/Industrial above 50,000 sq ft # Commercial/Industrial above 25,000 sq ft # MURB above 50,000 sq ft # MURB above 25,000 sq ft Future numbers increase by the growth rate of Toronto each year.,385 buildings City of Toronto MPAC database, as above. 2,620 buildings City of Toronto MPAC database, as above.,5 buildings City of Toronto MPAC database, as above. 2,088 buildings City of Toronto MPAC database, as above. GFA Commercial/Industrial above 50,000 GFA Commercial/Industrial above 25,000 86,320,58 ft 2 City of Toronto MPAC database, as above. 230,095,79 ft 2 City of Toronto MPAC database, as above. GFA MURB above 50, ,826,089 ft 2 City of Toronto MPAC database, as above. GFA MURB above 25, ,496,82 ft 2 City of Toronto MPAC database, as above. GFA in Toronto, Commercial/Industrial 332,805,853 ft 2 City of Toronto MPAC database, as above. GFA in Toronto, MURB 320,722,67 ft 2 City of Toronto MPAC database, as above. MWh in Toronto, Commercial/Industrial 5,058,649 MWh Calculated product of office energy intensity (5.2 kwh/ft 2 /yr, NRCan Comprehensive Energy Use Database Table, Ontario - Commercial/Institutional, Offices, 200 Data) and commercial/industrial building area (see above, GFA in Toronto, City of Toronto 4Y Page B

34 Assumptions and Inputs Value Basis Commercial/Industrial). MWh in Toronto, MURB 2,239,000 MWh City of Toronto Energy & Emissions Inventory & Mapping Report m3 gas in Toronto, Commercial/Industrial 480,000,000 m 3 gas m3 gas in Toronto, MURB 80,000,000 m 3 gas Water ($/m3) $2.96 /m 3 water City of Toronto water website /3 rd of the.44 Billion m 3 listed in City of Toronto Energy & Emissions Inventory & Mapping Report See assumptions section for further detail. City of Toronto Energy & Emissions Inventory & Mapping Report Water Rate Escalation 5% Toronto Star article Toronto Water Rates Going Up 9 Per Cent, , (less inflation assumed at 3%) Electricity ($/kwh) Electricity Rate Escalation $0. kwh electricity 7% in 205 then % thereafter City of Toronto Energy & Emissions Inventory & Mapping Report Ontario Power Authority Long Term Energy Plan Module 4 (Cost) (less inflation assumed at 3%) Natural Gas ($/m3) $0.25 /m 3 gas City of Toronto Energy & Emissions Inventory & Mapping Report Natural Gas Rate Escalation Water-Energy Relationship (kwh /m3-water) kw monthly peak power demand per annual kwh electricity used Carbon Intensity of electricity (tons / kwh) Carbon Intensity of natural Gas (tons / m3) Jobs Created Energy content of natural gas 0% Ontario Energy Board Historical Natural Gas Rates 0.55 kwh / m 3 water kw/ kwh ghg(t)/kwh ghg(t)/m 3 gas 5.32 person-years of employment per $ million saved 0.65 ekwh / m3 of gas City of Toronto Annual Energy Consumption and Greenhouse Gas Emissions Report, 20 Halsall Buildings Database for Commercial and MURB buildings in the Greater Toronto Area. Most recent Environment Canada National Inventory Report : Greenhouse Gas Sources and Sinks in Canada Most recent Environment Canada National Inventory Report : Greenhouse Gas Sources and Sinks in Canada Institute for Market Transformation & Political Economy Research Institute (202): Analysis of Job Creation and Energy Cost Savings From Building Energy Rating and Disclosure Policy Energy Star Portfolio Manager Technical Reference: Thermal Energy Conversions (July 203) City of Toronto 4Y Page B2

35 Appendix C Summary of Research and Interviews

36 Boston Chicago Washington D.C. Institute for Market Transformation (multiple jurisdictions) Social Benefit Expected - Anecdotal stories: "I had never looked at my energy data so closely before and now I'm aware of it" - Anecdotal story of Boston company that grew from 5 employees to 600 employees. No additional analysis was done. - Energy efficiency is too big an environmental opportunity to ignore. Energy use represents approx $3B/yr; 7% of city's GHGs. Impacts cost of living; livability. Law covers less than % of buildings that together use ~20% of total energy used by buildings. Municipal, commercial and residential. - Help building owners and managers better understand their own energy use and compare with peers. - Provide data for efficiency programs to make strategic decisions on program development and success measurement. Helps target incentives where work is most needed - Market transformation: Creates market pressure to motivate change when people rent, lease, buy, sell, etc. see buildsmartdc.com: intervallevel electricity usage for ~00 public buildings - No quantitative studies of job creation. - City taking responsibility for efficiency leads to increased activity - Minneapolis explored job creation benefit - Investing locally in building stock is hard to outsource; there is a local economic boost. - Building labelling protects the consumer. Tenants & owners know what they're buying. Apartment owners & small business owners benefit particularly. Investors & investing firms gain asset resilience. Required very little public money. Legislature support via C40. Further support from independent fundraising, elec and nat.gas utility groups - -3 FTE commitment to mobilize, setup, educate. Varies by city. which set up infrastructure for data sharing. - Philadelphia:.5 FTE internal staff for combined program & help centre. Mobilization: -2 FTEs. One for program development. City s Staffing Requirement - One FTE. Initially full-time. After 6-8 months, now part-time. - NYC: Due to size, larger staff of 3-5 FTE at peak. Committee work: ark/benchmarkinganddisclosuresignondocumentjuly30203.pdf Ongoing: -2 FTEs for ongoing support (help centre etc.) & enforcement. - Minneapolis:.5 FTEs likely. - Once in-place: tapers off, but too early to know by how much. Program Startup Budget Program Ongoing Budget Any Complementary Programs or Activities Deemed Critical to Program Success? Estimate of start-up budget: $00,000, for consulting, data analysis support, web development for disclosure, mailings. Second year, same budget approved. "Renew Boston": 5 yrs old. Energy efficiency & renewable energy in the city. Close & important partnership exists, to offer resources that drive people to energy efficiency programs and improvement. "Green living commission": support association, 30+ CEOs of major boston businesses. Provided working groups to get the word out. Full-time help centre; web development and guidance material. Utility data programs were critical. No start-up city budget. Startup was supported by Institute for Market Transformation's "City Energy" program, with funding by others, e.g. grant from utility/conservation authority DCSEU, mostly for staffing. Some cost for mailings, training sessions, communication/outreach. Ongoing city funding now exists for staffing, plus minor mailing/communication and IT costs. Energy star is free. - No complementary laws currently in place (eg.: audits, RCx, retrofit etc. are optional, not mandatory) - Partnerships were important - Not significant when partnerships are fostered. In-house financing is minimal - Policy developed by mayors office with help from inter-city groups (C40, IMT), Dept of finance gets list of owners/complying/non-complying; Dept of bldgs. sends enforcement letters. - Local groups provide advocacy, outreach, feedback. - Local USGBC chapter, BOMA, ASHRAE, engineers etc provide training & outreach - No consensus yet what is critical. "Follow-up" activity left to the building owner/manager (e.g. retro-commissioning, energy audit, retrofit, software audit, etc.) - Financing alone is not enough. City ordnance makes energy efficiency a priority.. - Benchmarking is a foundational activity. Monitoring and reporting enables management. Other programs can hardly work if this is not in place. Complementary Programs or Activities Deemed Helpful to Program Success? Local real estate business association, "A Better City", with funding for 2 interns for a year to engage the top real estate owners in the city, help them register and get building data input to portfolio manager. Professional data verification is unique to Chicago - leads to training - can be done in-house or externally. City recognizes existing licenses (p.eng, architects, etc). - DCSEU's suite of incentives and technical assistance programs is important - SEED program, funded by USDOE Outreach programs in place - Training: electrical utility, gas utility, EPA. 6 or 7 training sessions. - Info resources: central website, step by step guide; - Help centre: City employee answers calls, s. - Local BOMA, NAIOP too. - About 50% of calls to the help line in the st year were from consultants and service providers. Telephone help centre. Training sessions via USGBC, AIA, midwest energy efficiency alliance. Speaking engagements via BOMA Chicago, and other industry groups. Bbenchmarking help centre - over 70% of reporting buildings have gotten help from this centre. - Help centres, call centres are critical - Education, training, seminars, often offered by partner organizations (USGBC, etc.) - Advocacy, support coalitions developed locally, important to program establishment & buy-in. Significant challenges to implementation & lessons learned - Building size threshold is important. Boston: <2.5% of building stock covers over 40% of buildings. Initial threshold proposed 25,000sf was raised to 35,000sf which reduced building stock by 25% and only lost 0% of energy use market. - During the outreach process the city learned a lot about the program and what people thought of it. 2 year proposal, engagement & development timeline, including engagement of rea estate & business groups. Learned how smaller building owners perceived energy efficiency, building operation, and building management, which impacted the ordinance slightly, and significantly impacted program communication. - Utility data needs to be easy to access, needing to get permission or data from individual tenants makes the process impossible. - Normalization of results is important to public confidence. Some people find little value in un-normalized Energy Use Intensity (EUI), reported when a property is not eligible for an Energy Star 0 to 00 score. - Data quality issues can exist: program requires good data that people have confidence in. May have led to misinterpretation of results (eg by DSM trying to build programs based on the data). Negative press?. Most errors believed to be accidental. DC university analyzing data quality to target future enforcement, spot check audits, verifications. Data verification requirement is a future consideration (e.g.: every few years, data reviewed by professional engineer, architect, etc. to verify accuracy). - Data access element is critical. Utilities can provide this as a consumer benefit (sometimes regulator must get involved to mandate this). NYC: Customer cost to provide this. Other utilities provide this for free (seen as desired by the customer). Philadelphia: LDC voluntary. DC: in-the-works. Chicago: Con Edison in development. - National DOE data accelerator program to overcome data access hurdle. DOE SEED platform provides IT database service to link between cities and energy star. free to cities, downloadable, as repository and method of analysis. Uncertain roll-out timeline and availability in Canada. - Natural gas & water utilities less involved so far, but growing - Appeasing conflicting groups of stakeholders waters down the program. - NYC had 2 years of feedback before launch. Mandatory upgrades removed from NYC law, leading to stakeholder buy-in.

37 Boston Chicago Washington D.C. Institute for Market Transformation (multiple jurisdictions) How are poorly metered properties addressed (e.g.: malls or apartments with 00 individual meters, not main) - Commercial tenant is required to provide data to landlord (both energy use, and space use characteristics). - Residential: electrical utility will aggregate energy use, given list of meter numbers in the building (can be onerous). - Automated energy aggregation and upload is anticipated Summer 204, relatively easy to implement in Washington DC where the city has legislative authority over the utility company. - Electric is complying first. Gas, water utilities - soon, more responsive than proactive. - Still a real concern - DOE "whole building data access" program anticipated to help - Some building managers and owners writte lease requirement for tenants to share data Changes to Program Since Original Implementation (Submission deadline, building types required to participate, non-compliance measures etc) - Utility-aggregated data availability - Automation (pending) - Require people to run Energy Star's data quality checker, but no way to verify this has been done. - Aligned with EPA's exemption allowance for non-ratable tenant spaces (eg: restaurant) - On building sale, seller must provide data to buyer including Energy Star run, buyer is responsible for reporting. - Boston increased minimum building size from 25,000sf to 35,000sf; more flexibility in assessment/audit process; alternatives to compliance (eg. LEED labelled) - Seattle increased minimum building size from 0,000sf to 20,000 sf (small buildings more often owned by landlords lacking tools, resources, or knowledge required. eg.: no computer access, which is required to enter data into Energy Star). - Washington DC: feedback before launch was short. - Chicago & Maryland: 3rd party verification requred periodically Program Key Performance Indicators Used to Measure Success (e;g;: lower energy use, compliance rate<) - for the ordnance itself: compliance rate. The ordinance is just one part of the climate program. After 2-3 years, the measure will be about GHG emissions and energy efficiency. (note: ordnance also requires energy assessment or upgrade every 5 years). Buildings that cut by >5% over 5 years are exempted from assessment/upgrade. This was inserted at the request of some stakeholders. Alternative compliance increased buy-in. - Compliance rate - Total of,500 required to comply (,600 tax lots, about 00 turnovers) - Considering help centre response-time as a KPI - Considering enforcement reliability/speed KPI - Compliance rate is the only measurable and linkable metric (any reported energy savings could be argued to be due to other activities). Successes to-date Too early to tell - Too early to say. Anecdocally hearing it is having an effect: Some postsecondary institutions have seen their sustainability budget increase in anticipation of performance disclosure - Legislated in 2008 but implemented in 203. st yr of implementation: buildings disclosed several years of energy use: seeing 2-3% energy reduction per year (lines up closely to Energy Star's rate of savings from benchmarking), not directly attributable to energy disclosure, but perhaps related to anticipation of disclosure.. - Started with largest bldgs - over 200,000sf. That building set has in total saved about 9%. - Good will & communication between city & building owners increased significantly. Very positive response by investors, leasing agents. Data is increasing success. Compliance Rate Deadline to submit 203 data is September 5, 204. First year currently. About 300 of 000 reporting and expected to rise by the deadline. Passed ordnance sept 203. First reporting June 204. Compliance figures anticipated in late First two years compliance was in high 50's (55% then 58%, even though second year expanded scope of program by ~50%). Last year up to 83% compliance, after adding warning letters and letter of intent to issue fines. Cost of fine intended to be in the same realm as cost of compliance. Any Unexpected Benefits? - Anecdote: People are asking: how do I know if I'm comparing appropriately? There is clearly an interest by building owners in seeing how they compare - Aside: Utility-based whole building data availability (for multi-tenant buildings) is extremely useful. New service becoming available. - Owners of older buildings complain that they would suffer by comparison, yet New York data shows some older building vintages actually score much better. This surprised many building owners when they heard it. Level of partnership around transparency, ordnance, energy efficiency was extremely strong. Set the stage for professional community engagement. Strengthened USGBC, AIA, ASHRAE, etc. People see that this is beneficial for the city. - DC: no real correlation between large MURB and commercial buildings age and energy use (exception: old single family homes with lots of air leakage do perform worse). - Relatively few service providers helped with benchmarking (compared with NYC). Program Feedback (from general public, building owners, tenants, utilities, other stakeholders, etc) - Utilities are happy - it helps them achieve their energy efficiency mandate, helps them plan. They are eager partners. - Still early to tell how successful the ordnance will be. - most reporting done in-house, easy process even for non-energy expert. - Transactional disclosure believed to be less effective: occurs too late, and gets mixed with other information -"keys to success": appropriate scope; energy star; lead by example; outreach; data access; data quality; - Public buildings required down to 0,000sf. Private: down to 50,000sf. 2% of buildings with over 50% of building area. Now exploring expanding this threshold. Consider using tax data to choose an appropriate threshold. 0,000 sf can be problematic due to volume and type of building.

38 Appendix D Details of Building Types Assessed

39 List of Building Types Considered in this Analysis Commercial Commercial structure codes -Assembly Hall Commercial structure codes -Automotive show room Commercial structure codes -Automotive specialty shop (muffler shops, etc) Commercial structure codes -Bank/Trust company, freestanding Commercial structure codes -Billboard Commercial structure codes -Car wash (automatic) Commercial structure codes -Car wash (coin operated) Commercial structure codes -Cinema Commercial structure codes -Commercial tennis court Commercial structure codes -Commercial warehouse Commercial structure codes -Conventional restaurant, freestanding Commercial structure codes -Departmental Store Commercial structure codes -Discounted Store Commercial structure codes -Fast food restaurant, freestanding Commercial structure codes -Gas bar canopy Commercial structure codes -Gas bar kiosk Commercial structure codes -Hotel Commercial structure codes -Marina ancillary building Commercial structure codes -Mini bank/trust Building Commercial structure codes -Motel Commercial structure codes -Multi-use multi storey building Commercial structure codes -Office walk-up Commercial structure codes -Office walk-up, medical and dental Commercial structure codes -Office, multi-storey Commercial structure codes -Parking garage Commercial structure codes -Photo kiosk (outdoor) Commercial structure codes -Recreational swimming pool Commercial structure codes -Retail kiosk (indoor) Commercial structure codes -Retail Store Commercial structure codes -Service Garage Commercial structure codes -Service station Commercial structure codes -Shopping centre Community Commercial structure codes -Shopping centre neighbourhood Commercial structure codes -Shopping centre Regional Commercial structure codes -ski-lift Commercial structure codes -Supermarket Commercial structure codes -Theatre Commercial structure codes -Tower (e.g. microwave/radio/television transmitting) Commercial structure codes -Underground parking Commercial structure codes -Unspecified commercial structure

40 Industrial Industrial structure codes -Communication building Industrial structure codes -General purpose industrial ( GT 5,000 sq ft.) Industrial structure codes -Heavy industry Industrial structure codes -Industrial mall Industrial structure codes -Mini storage warehouse Industrial structure codes -Miscellaneous industrial (LT 5,000 sq ft.) Industrial structure codes -Office walk-up, industrial Industrial structure codes -Pre-fabricated stucture - Arched Rib Industrial structure codes -Pre-fabricated stucture - Clear Span Industrial structure codes -Pre-fabricated stucture - Multi span Industrial structure codes -Reinforced conc.frame ('B' construction bldgs.) Industrial structure codes -Special purpose Industrial structure codes -Standard industry Industrial structure codes -Truck terminal Industrial structure codes -Unspecified industrial structure Industrial structure codes -Warehousing Industrial structure codes -Wood framed industrial structures Residential - Multifamily Residential structure codes -Condominium Apartment, in a Medium/High Rise Residential structure codes -Condominium Apartment, in a walkup Residential structure codes -Condominium Row/Town House Residential structure codes -Condominium Stacked Town house Residential structure codes -medium/high rise apartment, more than 6 units, floors Residential structure codes -Row/Town house Rental (I unit of a complex) Residential structure codes -Sixplex Residential structure codes -Stacked Row/Town house Rental (I unit of a complex) Residential structure codes -Unspecified residential structure Residential structure codes -Walkup apartment, more than 6 units, -4 floors

41 List of Building Types Not Considered in this Analysis Residential - Single Family Residential structure codes - Single Family Row/Town House Residential structure codes - Single Family Semi-detached Residential structure codes -Condominium Single family detached Residential structure codes -Condominium Single family semi-detached Residential structure codes -Duplex Residential structure codes -Fiveplex Residential structure codes -Fourplex Residential structure codes -Link Home (Costed as Semi-detached) Residential structure codes -Link Home (Costed detached) Residential structure codes -Mobile Home Residential structure codes -Single Family Detached Residential structure codes -Triplex Industrial - excluded facility Industrial structure codes -Bin/Hopper Industrial structure codes -Gatehouse Industrial structure codes -Grain elevator Industrial structure codes -Industrial silo Industrial structure codes -Industrial Yard work Industrial structure codes -Lumber storage shed Industrial structure codes -Pipelines, compressor station Industrial structure codes -Tank Industrial structure codes -Tunnel

42 Total Gross Building Area (ft2) Number of buildings Commercial 0-9,999 5,866,87 6,68 0,000-24,999 7,856,60,7 00, ,006, ,000-49,999 2,20, ,000-99,999 4,03, Commercial Total 47,953,035 8,563 Industrial 0-9,999,70,592 2,405 0,000-24,999 2,85,989,35 00, ,564, ,000-49,999 3,565, ,000-99,999 40,736, Industrial Total 84,852,88 5,602 Residential - Multifamily 0-9,999 20,428,983 3,060 0,000-24,999 5,797, , ,976,866,038 25,000-49,999 20,670, ,000-99,999 33,849, Residential - Multifamily Total 320,722,67 6,2 Residential - Single Family (excluded) 724,548, ,958 Industrial - excluded facility 57,55,835,502 Grand Total,435,232,78 468,746

43 Commercial Commercial structure codes -Assembly Hall Commercial structure codes -Automotive show room Commercial structure codes -Automotive specialty shop (muffler shops, etc) Commercial structure codes -Bank/Trust company, freestanding Commercial structure codes -Billboard Commercial structure codes -Car wash (automatic) Commercial structure codes -Car wash (coin operated) Commercial structure codes -Cinema Commercial structure codes -Commercial tennis court Commercial structure codes -Commercial warehouse Commercial structure codes -Conventional restaurant, freestanding Commercial structure codes -Departmental Store Commercial structure codes -Discounted Store Commercial structure codes -Fast food restaurant, freestanding Commercial structure codes -Gas bar canopy Commercial structure codes -Gas bar kiosk Commercial structure codes -Hotel Commercial structure codes -Marina ancillary building Commercial structure codes -Mini bank/trust Building Commercial structure codes -Motel Commercial structure codes -Multi-use multi storey building Commercial structure codes -Office walk-up Commercial structure codes -Office walk-up, medical and dental Commercial structure codes -Office, multi-storey Commercial structure codes -Parking garage Commercial structure codes -Photo kiosk (outdoor) Commercial structure codes -Recreational swimming pool Commercial structure codes -Retail kiosk (indoor) Commercial structure codes -Retail Store Commercial structure codes -Service Garage Commercial structure codes -Service station Commercial structure codes -Shopping centre Community Commercial structure codes -Shopping centre neighbourhood Commercial structure codes -Shopping centre Regional Commercial structure codes -ski-lift Commercial structure codes -Supermarket Commercial structure codes -Theatre Commercial structure codes -Tower (e.g. microwave/radio/television transmitting) Commercial structure codes -Underground parking Commercial structure codes -Unspecified commercial structure Commercial Total Industrial Industrial structure codes -Communication building Industrial structure codes -General purpose industrial ( GT 5,000 sq ft.) Industrial structure codes -Heavy industry Industrial structure codes -Industrial mall Industrial structure codes -Mini storage warehouse Industrial structure codes -Miscellaneous industrial (LT 5,000 sq ft.) Industrial structure codes -Office walk-up, industrial Industrial structure codes -Pre-fabricated stucture - Arched Rib Industrial structure codes -Pre-fabricated stucture - Clear Span Industrial structure codes -Pre-fabricated stucture - Multi span Industrial structure codes -Reinforced conc.frame ('B' construction bldgs.) Industrial structure codes -Special purpose Industrial structure codes -Standard industry Industrial structure codes -Truck terminal Industrial structure codes -Unspecified industrial structure Industrial structure codes -Warehousing Industrial structure codes -Wood framed industrial structures Size Range (Building Square Feet) 0-9,999 0,000-24,999 00, ,000-49,999 50,000-99, ,066 36,77 305,82,045,609 2, ,288 08,08 6,53,00 22, ,364 83,250 77,05 662,267 36,966 59,394 7,66 6,6 82,986 30,057,607, ,68,84,738 25, ,225,076 40,305,48,762, , ,985 7,00 8,36 95, ,38 5,866,87 450,248 57,94 4,73 79,367 25,947 0,39 5,504 27,349 97,568 76,363 28,6 459,646 93,657 24,486 28,763 0,238 55,77 624,038,862, ,028,829,332 5,252 57,750 6,699,544,98,383 2,646,69,56 48,406 29,386 34, ,46 7,856,60 448,482,465,075,326,30 930, ,746,703,84 692,999 3,445,93 2,44,989 3,009,838 2,543, , , , ,095,665,002,9,76 52,006, , ,045 25,256 26,53 45, ,746 25,055 90, ,32,44, ,579 2,540,74 98,949 2,409,400 68,93,368,404 27, ,890 84,360 28,544 4, ,059 2,20,27 70,408 46,988 54, , , ,589,235, ,8 6,048, ,784,88,847 24,324 60,392,042, ,75 207,253 44, ,042 4,03,383 Total Size Range Number of buildings (Building Square Feet) 0-9,999 0,000-24,999 00, ,000-49,999 50,000-99, , , , ,07,345,487,63 420,534,673,458 2,340 32,235 8, ,023 53,705,6, ,470,603,849 2,543,22 80, ,753 36,966,40,958 7,66 26, ,245 3,447,000 6,83,259,290,469 43,049,089 2,85, ,975,076 54,306,047 3,794, ,238 2,603,630 5,06, ,458 7,00 2,447, ,670 29,007,885,04 3,65,0 47,953,035 Total Number of buildings 98,64 4,93 85,468 4, , ,875 3,482 26, ,698 7,442,69 9,04,726, ,847 5,984 5,702 54,359 66, ,02 6, ,44 42,307 20,970,42 3,500 27,828 4,980,529 4,50 2,377,409 2,575,277 59, ,455 4,607,086 3,947,345 34,860 40, ,557 45,0,305 5,966,756 7,532,79 350, ,406 2,462,94 970, ,243 0,2 9,334,362 3,280,507 4,42,408 59, ,363 4,225, ,239,28,762 59,36 54,894 22,944,820 22,428 4,844,086 6,049, , ,453,750,8 5,894,075,66, ,725 2,96,805,664,982 34,452 47,795 4,348 59,36 06,420 09,82, ,952 8,95,096 3,576,327 5, , Industrial Total,70,592 2,85,989 79,564,230 3,565,46 40,736,86 2,405, ,852,88 5,602 Residential - Multifamily Residential structure codes -Condominium Apartment, in a Medium/High Rise Residential structure codes -Condominium Apartment, in a walkup Residential structure codes -Condominium Row/Town House Residential structure codes -Condominium Stacked Town house Residential structure codes -medium/high rise apartment, more than 6 units, floors 329, ,328 3,850,665 2,558,0 456,090,370, ,249 5,326,89 2,037,008 60,29 80,586,822 37,742 3,90,089 4,407,80 39,953,486 4,86, ,300 4,662,842 3,286,426 3,655,570 5,759,66 24,994 4,963, ,20 0,8, ,83,097, ,907,634 2,095,63 32,705,288 2,848,474 54,793, , ,563, ,4,337,490

44 Residential structure codes -Row/Town house Rental (I unit of a complex) 45,809 25,79 326, , Residential structure codes -Sixplex,026,90 68, ,094, Residential structure codes -Stacked Row/Town house Rental (I unit of a complex) 85,485 85,485 Residential structure codes -Unspecified residential structure 6, ,904 0 Residential structure codes -Walkup apartment, more than 6 units, -4 floors,73,794 5,480, ,272 3,607,265 2,20,77, ,585,882 2,039 Residential - Multifamily Total 20,428,983 5,797, ,976,866 20,670,093 33,849,223 3, , ,722,67 6,2 Residential - Single Family (excluded) Residential structure codes - Single Family Row/Town House 37,267,889 79,890 0,0 82,845 74,949 23, ,455,683 23,984 Residential structure codes - Single Family Semi-detached 36,47,76 9,797 93, ,562,973 93,379 Residential structure codes -Condominium Single family detached 536,659 32, , Residential structure codes -Condominium Single family semi-detached 72, , Residential structure codes -Duplex 9,64,262 3,98 9,64,262 3,98 Residential structure codes -Fiveplex 433,469 2, ,469 0 Residential structure codes -Fourplex 4,722,372 32,364 5,480,93 3 4,806,26,97 Residential structure codes -Link Home (Costed as Semi-detached) 820, , Residential structure codes -Link Home (Costed detached) 7,407,86 4,669 7,407,86 4,669 Residential structure codes -Mobile Home 2,322 2,322 Residential structure codes -Single Family Detached 520,540,608 2,577,883 49,895 5,39 297, ,39, ,82 Residential structure codes -Triplex 2,247,727 24, ,272, Residential - Single Family (excluded) Total 720,237,84 3,59,26 0,0 332, , , ,548, ,958 Industrial - excluded facility Industrial structure codes -Bin/Hopper 5,44 4 5,44 4 Industrial structure codes -Gatehouse Industrial structure codes -Grain elevator 95,667 95,667 Industrial structure codes -Industrial silo 2,064 8, ,504 0 Industrial structure codes -Industrial Yard work 2,368,363 5,488,59 22,86,7,706,350 4,437, ,862,260,49 Industrial structure codes -Lumber storage shed 70,476 28, ,58 28 Industrial structure codes -Pipelines, compressor station 4,240 4,240 Industrial structure codes -Tank 5, ,62 33 Industrial structure codes -Tunnel Industrial - excluded facility Total 2,456,726 5,56,696 22,86,7,706,350 4,64, ,55,835,502 Grand Total 806,60,356 64,577, ,58,96 76,484,456 03,49, ,294 4,085,755 2,42,470,435,232,78 468,746

45 Appendix E Limitations

46 APPENDIX E: LIMITATIONS Parsons Brinckerhoff Halsall Inc. is the Consultant referenced throughout this document. The scope of our work and related responsibilities related to our work are defined in our project authorization ( Conditions of Assignment ), dated June 6, 204. Any user accepts that decisions made or actions taken based upon interpretation of our work are the responsibility of only the parties directly involved in the decisions or actions. No party other than the Client shall rely on the Consultant s work without the express written consent of the Consultant, and then only to the extent of the specific terms in that consent. Any use which a third party makes of this work, or any reliance on or decisions made based on it, are the responsibility of such third parties. Any third party user of this report specifically denies any right to any claims, whether in contract, tort and/or any other cause of action in law, against the Consultant (including Sub-Consultants, their officers, agents and employees).the work reflects the Consultant s best judgement in light of the information reviewed by them at the time of preparation. It is not a certification of compliance with past or present regulations. Unless otherwise agreed in writing by the Consultant, it shall not be used to express or imply warranty as to the fitness of the property for a particular purpose. No portion of this report may be used as a separate entity; it is written to be read in its entirety. Only the specific information identified has been reviewed. No physical or destructive testing and no design calculations have been performed unless specifically recorded. Conditions existing but not recorded were not apparent given the level of study undertaken. Only conditions actually seen during examination of representative samples can be said to have been appraised and comments on the balance of the conditions are assumptions based upon extrapolation. Therefore, this work does not eliminate uncertainty regarding the potential for existing or future costs, hazards or losses in connection with a property. We can perform further investigation on items of concern if so required. The Consultant is not responsible for, or obligated to identify, mistakes or insufficiencies in the information obtained from the various sources, or to verify the accuracy of the information. No statements by the Consultant are given as or shall be interpreted as opinions for legal, environmental or health findings. The Consultant is not investigating or providing advice about pollutants, contaminants or hazardous materials. The Client and other users of this report expressly deny any right to any claim against the Consultant, including claims arising from personal injury related to pollutants, contaminants or hazardous materials, including but not limited to asbestos, mould, mildew or other fungus. Budget figures are our opinion of a probable current dollar value of the work and are provided for approximate budget purposes only. Accurate figures can only be obtained by establishing a scope of work and receiving quotes from suitable contractors. Time frames given for undertaking work represent our opinion of when to budget for the work. Failure of the item, or the optimum repair/replacement process, may vary from our estimate. City of Toronto 4Y22-074

47 Appendix F Endnotes

48 APPENDIX F: ENDNOTES Joe D Abramo, Toronto s Climate Change Initiatives, CIP Conference, Montreal, Bert Archer, Big landlords, tenants near four-year green target two years early, December, Interview, Carl Spector, Director of Climate and Environmental Planning, Boston 4 New York City Local Law 84 Benchmarking Report September Institute for Market Transformation and Political Economy Research Institute, Analysis of Job Creation and Energy Cost Savings From Building Energy Rating and Disclosure Policy, March Halsall Associates, Canadian Urban Institute, City of Toronto Energy & Emissions Inventory & Mapping Report, April 24, American Council for an Energy-Efficient Economy, Lessons Learned from the Implementation of Rating and Disclosure Policies in U.S. Cities, Buildingrating.org. 9 Bert Archer, Big landlords, tenants near four-year green target two years early, December, Northeast Energy Efficiency Partnerships, Building Energy Rating and Disclosure Policies Update and Lessons From the Field Local Laws of The City of New York No. 87, Energy Audits and Retro-Commissioning of Base Building Systems 2 San Francisco Ordinance No. 7-, Environment Code Existing Commercial Buildings Energy Performance 3 Environment Canada, Canadian adaption of the United States Environment Protection Agency s Energy Star Portfolio Manager benchmarking tool (NRCan ), portfoliomanager.energystar.gov 6 Seattle Office of Sustainability & Environment, 20/202 Seattle Building Energy Benchmarking Analysis Report, January Institute for Market Transformation, Benchmarking Help Centre Guide, November Interview with Associate Director Caroline Keicher, Institute for Market Transformation 9 Federation of Rental Housing Providers of Ontario testimony and Stratacon, Inc, testimony in Ontario Standing Committee (2006); Toronto, 2008, p PG&E, How to Release Your Data for Benchmarking, Sustainable Buildings Canada Development of Energy Efficiency Requirements for the Toronto Green Standard: Final Report, NRCan Comprehensive Energy Use Database Table, Ontario - Commercial/Institutional, Offices, 200 Data 24 Toronto s 202 Greenhouse Gas and Air Quality Pollutant Emissions Inventory. June 9, US Environmental Protection Agency, Data Trends, Benchmarking and Energy Savings, October 202 City of Toronto 4Y22-074

49 Appendix G Tables of Potential Program Results

50 As of 2020 Scenario A Scenario B Commercial % Industrial % Multi-Residential % TOTAL Commercial % Industrial % Multi-Residential % TOTAL Market Penetration (ft2 building area) 86,000,000 7% 70,000,000 33% 250,000,000 50% 500,000,000 72,000,000 6% 30,000,000 30% 230,000,000 53% 440,000,000 Market Penetration (# of buildings) 850 8% 2,000 42%,900 40% 4, %,00 36%,400 48% 2,900 Annual Electricity savings (MWh) 0,000 23% 220,000 45% 60,000 32% 490,000 39,000 23% 7,000 42% 58,000 35% 70,000 Annual Natural Gas Savings (,000 m 3 ),000 2% 2,000 24% 56,000 64% 88,000 3,700 2% 6,700 2% 2,000 67% 3,000 Annual Water Savings (m 3 ) 620,000 0%,200,000 9% 4,600,000 72% 6,400,000 20,000 9% 380,000 6%,700,000 74% 2,300,000 Annual Energy Savings (emwh) 230,000 6% 450,000 3% 750,000 53%,400,000,000 78,000 6% 40,000 28% 280,000 56% 500,000 Total energy used (emwh) 4,700,000 22% 5,700,000 27%,000,000 52% 22,000,000,000 4,900,000 22% 6,000,000 27% 2,000,000 52% 23,000,000 Demand Savings (MW) 22 23% 44 45% 3 32% % 4 42% 35% 33 Annual GHG savings (tons CO 2e ) 34,000 5% 65,000 29% 20,000 56% 220,000,000 5% 2,000 26% 46,000 59% 78,000 Annual Cost Savings ($) 9,000,000 8% 38,000,000 35% 52,000,000 48% 0,000,000 6,600,000 7% 2,000,000 32% 9,000,000 5% 38,000,000 Jobs Created (#) 00 8% % % % 64 32% 00 5% 200 As of 2025 Scenario A Scenario B Commercial % Industrial % Multi-Residential % TOTAL Commercial % Industrial % Multi-Residential % TOTAL Market Penetration (ft2 building area) 92,000,000 7% 80,000,000 33% 270,000,000 50% 540,000,000 78,000,000 6% 40,000,000 30% 250,000,000 53% 470,000,000 Market Penetration (# of buildings) 90 8% 2,200 42% 2,00 40% 5, %,00 36%,500 48% 3,00 Annual Electricity savings (MWh) 200,000 23% 390,000 45% 270,000 32% 860,000 9,000 23% 70,000 42% 40,000 35% 390,000 Annual Natural Gas Savings (,000 m3) 9,000 2% 37,000 24% 98,000 64% 50,000 8,700 2% 6,000 2% 49,000 67% 74,000 Annual Water Savings (m3),00,000 0% 2,00,000 9% 8,00,000 72%,000, ,000 9% 900,000 6% 4,00,000 74% 5,500,000 Annual Energy Savings (emwh) 400,000 6% 780,000 3%,300,000 53% 2,500,000,000 80,000 6% 330,000 28% 660,000 56%,200,000 Total energy used (emwh) 4,900,000 22% 5,900,000 26% 2,000,000 52% 22,000,000,000 5,200,000 22% 6,300,000 27% 2,000,000 5% 24,000,000 Demand Savings (MW) 39 23% 76 45% 53 32% % 33 42% 27 35% 78 Annual GHG savings (tons CO2e) 59,000 5% 0,000 29% 220,000 56% 390,000 27,000 5% 49,000 26% 0,000 59% 80,000 Annual Cost Savings ($) 36,000,000 7% 70,000,000 34% 00,000,000 49% 20,000,000 7,000,000 7% 30,000,000 3% 5,000,000 52% 97,000,000 Jobs Created (#) 90 7% % %, % 60 3% % 520

51 As of 2030 Scenario A Scenario B Commercial % Industrial % Multi-Residential % TOTAL Commercial % Industrial % Multi-Residential % TOTAL Market Penetration (ft2 building area) 99,000,000 7% 90,000,000 33% 290,000,000 50% 590,000,000 84,000,000 6% 50,000,000 30% 270,000,000 53% 50,000,000 Market Penetration (# of buildings) 980 8% 2,300 42% 2,300 40% 5, %,200 36%,600 48% 3,400 Annual Electricity savings (MWh) 220,000 23% 420,000 45% 290,000 32% 930,000 40,000 23% 260,000 42% 20,000 35% 620,000 Annual Natural Gas Savings (,000 m3) 20,000 2% 40,000 24% 0,000 64% 70,000 4,000 2% 25,000 2% 77,000 67% 20,000 Annual Water Savings (m3),200,000 0% 2,300,000 9% 8,700,000 72% 2,000, ,000 9%,400,000 6% 6,400,000 74% 8,600,000 Annual Energy Savings (emwh) 430,000 6% 840,000 3%,400,000 53% 2,700,000, ,000 6% 530,000 28%,000,000 56%,900,000 Total energy used (emwh) 5,300,000 22% 6,400,000 26% 2,000,000 52% 24,000,000,000 5,500,000 22% 6,700,000 27% 3,000,000 5% 25,000,000 Demand Savings (MW) 42 23% 82 45% 57 32% % 5 42% 42 35% 20 Annual GHG savings (tons CO2e) 63,000 5% 20,000 29% 230,000 56% 420,000 42,000 5% 77,000 26% 70,000 59% 290,000 Annual Cost Savings ($) 42,000,000 7% 82,000,000 33% 20,000,000 50% 250,000,000 28,000,000 7% 5,000,000 30% 90,000,000 53% 70,000,000 Jobs Created (#) 220 7% % %, % % % 900 As of 2035 Scenario A Scenario B Commercial % Industrial % Multi-Residential % TOTAL Commercial % Industrial % Multi-Residential % TOTAL Market Penetration (ft2 building area) 0,000,000 7% 20,000,000 33% 30,000,000 50% 620,000,000 89,000,000 6% 60,000,000 30% 290,000,000 53% 540,000,000 Market Penetration (# of buildings),000 8% 2,500 42% 2,400 40% 5, %,300 36%,700 48% 3,600 Annual Electricity savings (MWh) 230,000 23% 440,000 45% 30,000 32% 980,000 50,000 23% 280,000 42% 230,000 35% 660,000 Annual Natural Gas Savings (,000 m3) 22,000 2% 42,000 24% 0,000 64% 80,000 4,000 2% 26,000 2% 82,000 67% 20,000 Annual Water Savings (m3),200,000 0% 2,400,000 9% 9,300,000 72% 3,000, ,000 9%,500,000 6% 6,800,000 74% 9,00,000 Annual Energy Savings (emwh) 460,000 6% 890,000 3%,500,000 53% 2,900,000,000 30,000 6% 560,000 28%,00,000 56% 2,000,000 Total energy used (emwh) 5,700,000 22% 6,700,000 26% 3,000,000 52% 26,000,000,000 5,800,000 22% 7,00,000 27% 4,000,000 5% 26,000,000 Demand Savings (MW) 45 23% 87 45% 6 32% % 55 42% 45 35% 30 Annual GHG savings (tons CO2e) 67,000 5% 30,000 29% 250,000 56% 450,000 45,000 5% 8,000 26% 80,000 59% 30,000 Annual Cost Savings ($) 48,000,000 7% 93,000,000 32% 40,000,000 5% 290,000,000 32,000,000 6% 58,000,000 30% 0,000,000 54% 200,000,000 Jobs Created (#) 250 7% % 770 5%, % 30 30% %,000