CAGBC Budget 2024 Reaction

Budget 2024 held no surprises but continued investments in programs supporting green building.

Whether new construction or retrofits, zero-carbon buildings are Canada’s best and most cost-effective option for reducing greenhouse gas (GHG) emissions. At a time when affordability is driving many policy and program decisions, it is important to remember that zero-carbon and green buildings deliver better quality and lower operating costs.

Given the potential of green buildings, the Canada Green Building Council recommended that the federal government release and implement a well-funded and ambitious Canada Green Buildings Strategy (CGBS) to support the decarbonization of the built environment. This approach was supported by building sector businesses and organizations, as investments in green building and decarbonization can support Canada’s energy grid, accelerate innovation, and create up to 1.5 million jobs.

Budget 2024 contains some good news for the building sector, and CAGBC breaks it down for you here:

What the budget got right

Green and Inclusive Community Buildings Program: This program aims to provide $500M over five years to Infrastructure Canada in support of the retrofit and new construction of accessible public buildings and infrastructure. This investment expands an existing program, which leveraged CAGBC’s Zero Carbon Building – Design Standard for new construction, and demonstrated significant reductions in greenhouse gas emissions.

Canada’s Housing Plan: Energy-efficient buildings can reduce the lifetime cost of maintaining a home by lowering utility bills and insurance costs. The federal government shared details of Canada’s Housing Plan before presenting Budget 2024, earmarking $800M for the Canada Greener Homes Affordability Program and $100M to “renew and improve existing energy efficiency programs that offer tools to building owners” and assist in the “development of better building codes,” and for the government to continue “developing national approaches to home energy labelling.” Of the $100M, $73.5M will be allocated to modernize existing energy efficiency programs that offer tools like ISO 50001 Energy Management Systems Standard and the ENERGY STAR Portfolio Manager.

The remaining investment is earmarked to develop a national approach to home energy labelling. CAGBC, in its pre-budget submission, recommended a labelling and disclosure program for the commercial and institutional buildings. We hope this will be a next step, building on the residential program.

Affordability: In Budget 2024, the federal government pledged two million net new homes, saying it can contribute more than half of them with $1.1 billion over ten years earmarked to transform half of the federal office portfolio into housing. In addition, the Budget allocates a $15 billion top-up to the Apartment Construction Loan Program, targeting the construction of 30,000 new homes across Canada. However, there remains a concern that the government may downgrade the energy efficiency requirements for this program. We are looking forward to discussing this with the ministers and public servants to ensure the program reflects the energy efficiency benefits and carbon emissions reductions green buildings can provide.

Budget 2024 also calls for investments in housing technology, including prefabricated homes, and a temporary accelerated capital cost allowance tax measure to incentivize more purpose-built rental projects. Stay tuned for more analysis from CAGBC on these programs.

What else we wanted to see

Canada Green Buildings Strategy: Prior to the Budget, the federal government announced $900M to support the implementation of the Canada Green Buildings Strategy. Today, the federal government released more details and confirming that only $77M will be spent before the next election. When it was announced, the Canada Green Buildings Strategy was intended to mobilize national action to reduce emissions by 37 percent from 2005 levels by 2030, and to help create a net-zero-emissions buildings sector by 2050. The Strategy was intended to increase the rate of building retrofits and ensure new buildings are resilient and net-zero-ready from the start. CAGBC would have liked to have seen more of this funding put into action sooner.

Buy Clean Strategy: The federal government spends over $30 billion in annual procurement, making it the largest public buyer in Canada. As the government shifts to prioritize low-carbon products from Canada’s emerging clean technology sector, these businesses will need support to demonstrate their products meet changing requirements. CAGBC recommended $25M over three years to create a sustainable construction materials grant program to build additional capacity for Life Cycle Assessments and Environmental Product Declarations. Unfortunately, Budget 2024 missed the opportunity to invest in Canadian SMEs and the low-carbon supply chain.

Overall, Budget 2024 is a step in the right direction for Canada’s building sector, addressing the housing shortage and supporting green community buildings. Yet, much more must be done to meet Canada’s climate goals and the sector’s contribution to the Emissions Reduction Plan. We look forward to supporting the federal government on these new or improved initiatives, while continuing to advocate for the sector and unlock the value of green buildings for all Canadians.