Vancouver Study Foresees Big Demand for Green Products

If you’re selling run-of-the-mill double-pane windows in the Greater Vancouver market in Canada, it’s time to start retooling your production lines, according to a new study by the Vancouver Economic Commission. Demand for those windows will drop by 2022 and vanish by 2027, according to the study, which tracks the implementation dates for British Columbia’s new Energy Step Code.

The commission’s “Green Buildings Market Forecast” was released in March 2019. The Energy Step Code is an optional path for municipalities in British Columbia (BC) to accelerate the progress of energy codes ahead of 2032, when BC’s mandatory energy code will require all buildings to be “net-zero-energy ready.”

A very conservative estimate

Including windows, insulation, heat-recovery ventilators, heat pumps, and water heaters, sales of high-efficiency products will surpass CA$3.3 billion (cumulatively) by 2032. That CA$3.3 billion number “is a very conservative estimate,” says Juvarya Veltkamp of the Vancouver Economic Commission, the report’s author.

That estimate comes from a product-demand forecasting model created for the Commission by Delphi Group. To inform the model, Integral Group and Morrison Hershfield analyzed five building types and determined what performance levels will be required for building enclosure and mechanical systems to meet the increasingly rigorous thresholds in the Energy Step Code. They considered both lowest first-cost approaches and those with the best payoff over time, according to Veltkamp. The model assumes that most, but not all, buildings, will opt for solutions with the lowest up-front costs.

Force multipliers

Actual demand for these products will far exceed CA$3.3 billion over the next 14 years, according to the report, because:

1. The step code is optional for municipalities to adopt, and the study only included the impact of the code for the five Vancouver-area cities that have already adopted it, even though others are likely to follow suit. These five municipalities represent about half of the Greater Vancouver population, according to Veltkamp.
2. The study only considered new construction, which represents 60%–70% of construction activity in Metro Vancouver. Many of these products will also be used for retrofits.
3. The study only considered building types that are currently covered by the step code, which are commercial office buildings and the whole range of residential buildings from single-family homes to high-rise apartment buildings. Schools, hospitals, and other building types are not included, although at least some of them are likely to be added to the step code in the future.
4. The CA$3.3 billion number is just for Greater Vancouver, even though the step code is being adopted throughout British Columbia. About half of BC’s population is outside the Greater Vancouver area.

The carbon factor

BC’s step code has been criticized for its focus on energy performance, not carbon emissions. But “70% of the Metro Vancouver population is in areas affected by carbon regulations as well,” says Veltkamp. Those regulations will drive technology choices also, leading to greater use of heat pumps instead of boilers, for example. “Our model could be adjusted to layer on greenhouse gases,” Veltkamp notes.

The commission is also interested in drivers for local resources such as forest products but has not yet considered the potential for policies around embodied carbon as a driver for those products. Wood-fiber-based sheathing and insulation have been recommended as a replacement for plastic foam insulation, for example.

A convergence of factors has primed the Vancouver market for a wholesale shift to high-performance buildings, according to Veltkamp. This study focuses on the impacts of the step code, but market demand, available talent, and capacity for innovation also play a role. “Metro Vancouver has seen a 35% increase in green jobs since 2010,” says Veltkamp, adding: “the biggest growth is in green buildings.”

For more information:

Vancouver Economic Commission

vancouvereconomic.com