On March 21st, Ontario Energy Minister Greg Rickford presented the replacement to the previous provincial government’s “Fair Hydro Plan” with the “Fixing the Hydro Mess Act”. Among other things, the act makes changes to the previous government’s Conservation First Framework. The current Ontario government will be replacing the previous Conservation First Framework with the new Interim Framework.
The new program, called Interim Framework becomes active Apr. 1/19, with a target finish date of Dec. 31/20. It is likely that the government’s intent is to come up with a new plan to begin in January of 2021.
What does this mean to a building owner?
The most notable difference between the Conservation First Framework and the Interim Framework is that the Interim Framework excludes some of the incentive programs, including the Audit Funding Program.
As an engineering firm that specializes in delivering energy audits and investment grade studies, this will cause some disruption, but not as much as you may think. Our clients hire us to help them best invest in their buildings to reduce utility and operating costs. The money spent on an energy audit is typically 1% of the energy savings over the life of the upgrade. In other words, a $10,000 audit would typically achieve $1,000,000 over the life of the equipment or retrofit.
The reasons for having an investment grade audit or study far outweigh the loss of the incentive. The incentive amount under the Conservation First Framework would only have been 0.5% of the achieved savings. Many of the more important incentives remain, including the Retrofit Program, Process & Systems Upgrades and the Energy Performance Program.
Our clients understand that investing in energy conservation is crucial. Projects in their existing buildings almost always have a better return than purchasing new buildings. The federal government’s new budget (which I will be writing about in a few days) will put further pressures on building owners to reduce utility costs through investing in conservation upgrades.