Breaking the gas habit

According to federal government data, fully two-thirds of all the energy Canadians use to heat their homes is supplied by natural gas and propane. For climate activists and building owners who want to decarbonize Canada’s building stock, that figure is, well, chilling. While natural gas is one of the cleanest burning fossil fuels, this statistic alone offers a bracing reminder that Canada remains a long way from the day when our housing stock is no longer responsible for a formidable share of the country’s overall greenhouse gas emissions.

Yet federal and provincial policymakers these days are actively promoting so-called “net zero energy” homes, which use enough renewable and passive energy to cancel out the consumption of non-renewable sources.

So the question is, how should we go about weaning ourselves of our dependence on natural gas for space and water heating?

Climate and energy experts point out that this transition will be neither easy nor quick. After all, over the past two decades or so, energy regulators have created a policy environment that encouraged a vast investment in natural gas distribution infrastructure, at least in part to encourage homeowners to switch from dirtier sources, like home heating oil or inefficient electric heating (e.g., baseboards).

“Natural gas is the default from a policy point of view,” observes Greenpeace Canada energy strategist Keith Stewart.

The other hurdle, adds energy consultant Chris Caners, is price: Natural gas remains a very abundant and therefore inexpensive fuel (Canada is the world’s fourth largest producer, with 5 per cent of the global market). In other words, the transition hinges on the emergence of alternative technologies that will eventually be cost competitive with natural gas. That process will take time.

To that end, The Atmospheric Fund (TAF), Ontario’s energy industry regulator and the federal government late last year launched a large-scale pilot project, dubbed TowerWise, which is designed to demonstrate energy savings in older apartment buildings and townhouses that convert to so-called gas absorption heat pumps as a heat source. The $15 million venture, to be implemented in several buildings in Toronto and Hamilton, involves extensive energy efficiency retrofits, but turns on the deployment of heat pumps to replace old-style baseboard heaters.

According to Bryan Purcell, TAF’s director of policy and programs, the sponsors will monitor the energy savings over three years to determine if the combination of new technologies can yield a 40 per cent reduction in emissions.

Heat pumps use refrigerant gases to gather very low levels of ambient heat from outside air. Condensers then concentrate and thus increase the gas temperatures, with the resulting heat pumped into interior spaces. They can function with air temperatures as low as -35 C.

Ground-source heat pumps function in a very similar way, except they draw low level heat from the ground through a series of buried pipes. Both of these types of devices, which are commercially available, use electricity to function, but are far more energy efficient than baseboard heaters.

The prices, however, remain high. University of Toronto geographer and climate change expert Danny Harvey says the top models can transform a unit of electricity into four units of heat, but the payback period can run to 20 or 30 years.

The TAF project, moreover, doesn’t supplant natural gas heating per se; the buildings will simply see their electric space heaters replaced. But Purcell notes that the objective, in part, is to boost the overall market for heat pumps. “In doing these projects, we’ll help create market capacity.”

As with previous renewable or low-emission energy technologies, the chicken-and-egg problem can be formidable, with utilities or consumers slow to adopt because of uneconomical prices that reflect slim demand. In the case of heat pumps, a 2016 TAF study on heat pumps identified 1970s-1980s vintage multi-unit apartment buildings as ideal early adopters. But the study also concluded that property managers were mostly unfamiliar with the technology and lacked awareness of the benefits in terms of energy usage in their buildings.

Heat pumps don’t represent a potentially viable alternative to natural gas heating in every part of the country. Those provinces that rely mainly on hydro or a combination of hydro and other low-emission technologies like nuclear plants (British Columbia, Manitoba, Ontario, Québec and Newfoundland/Labrador) hold out the possibility of using clean electricity to replace gas. But in jurisdictions without an abundance of low-cost hydro, the cost issues present a steep hurdle.

Purcell points out there are market openings in regions where homeowners and property owners aren’t connected to the natural gas grid and still rely on fuel oil or propane, such as parts of the Maritimes, where heat pumps have made inroads.

Ontario poses a challenge because it has a surplus of renewable energy capacity and costly electricity. But, Purcell says, it’s possible to develop smart hybrid solutions that optimize the use of high-performing heat pumps and intermittent renewable sources, such as solar and wind. “That could be a smart system that can reduce electricity system costs and carbon and build a business case to get more heat pumps into buildings,” he predicts.

Yet none of this will happen without shifts in energy regulation that provide incentives both for building owners who want to switch away from natural gas and developers who want to build structures that don’t rely on gas for heating. “You need the provinces to clear the way,” says Stewart.

Regulators, Caners says, need to increase financial incentives for natural gas distributors to offer their customers the option of switching, as is already the case with measures meant to promote high-efficiency gas furnaces. “We have to incentivize consumer choice. There has to be a significant centralized response. At present, there are no economic incentives for people to remove natural gas.”

Provincial and federal building codes represent another important policy mechanism. Although stricter in terms of emissions, the next-generation versions of the building codes, Caners and Harvey argue, should provide for alternatives to natural gas-based heating systems, as well as encourage heat conservation features like insulation and passive design approaches. “There should be nothing less than triple-glazed windows and 95 per cent efficient furnaces,” says Harvey.

In fact, Purcell points to projections that a very large proportion of buildings estimated to be in use by 2050 don’t currently exist, and all that future construction represents a vast new market for heat pumps. Though building codes weren’t initially established to promote conservation, policymakers and energy efficiency experts have come to recognize that they can be used, as is done in Europe, to drive initiatives such as the move to net zero buildings. “There’s great potential there.”

The adoption of provincial incentives to promote alternatives to natural gas would, in turn, allow municipalities to step up with their own policies, such as zoning and land-use planning regulations that encourage, for example, clusters of homes or entire subdivision projects to be heated with centralized geothermal or ground-source heat pump systems, much in the way that district heating or cooling systems currently function.

Finally, the full emission impact of natural gas may be further mitigated with the advent of new sustainable biofuels that can be combined with natural gas to produce a lower-carbon energy source.

Ultimately, the goal of substantially reducing building-related emissions, which account for about 40 per cent of Canada’s carbon output, rests on carbon pricing and levies that render low-emission technologies, like heat pumps, economically viable.

“At some point, the whole grid needs to be carbon free,” says Harvey. But, he adds, “getting to zero is really hard.”

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