ARCHIVED - Evaluation of the Equipment Sub-Sub Activity

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Table of Contents


Executive Summary

Introduction

This report provides the findings of the evaluation of Natural Resources Canada's (NRCan's) Equipment Sub-Sub Activity, which comprises four programs and one interim strategy, intended to reduce the energy used by equipment in Canada, thereby reducing greenhouse gas (GHG) emissions. The Equipment Sub-Sub Activity undertakes various activities to reach the objective, centering around regulatory and nonregulatory programming aimed at increasing the efficiency of energyusing products in the residential, commercial/institutional, and industrial sectors. Between 2004–05 and 2008–09, total expenditures for the Equipment Sub-Sub Activity were $50.1 million. Of this, $22.5 million was for grants and contributions.

The programs encompassed in the Equipment Sub-Sub Activity (Accelerated Standards Action Program, EnerGuide for Industry, Enhanced Equipment Market Transformation, and Energy Efficiency Standards and Labelling Program) use a mix of approaches including standards, mandatory labelling, voluntary labelling and promotion.

  • Standards: development of new standards and increases to the stringency of existing standards that set minimum energy performance standards (MEPS) for residential, commercial, and industrial energyusing products to eliminate the least energyefficient products from the Canadian market, and therefore reduce the amount of GHG emissions released into the Earth's atmosphere.
  • Mandatory labelling: Energy Efficiency Regulations requirement that an EnerGuide label be displayed on all major electrical household appliances and room air conditioners imported into Canada or shipped across provincial/territorial borders for the purpose of sale or lease to provide information that allows consumers to compare the energy efficiency of different models within a product class.
  • Voluntary labelling and promotion: promotion of the use of energyefficient products through the promotion of voluntary EnerGuide and ENERGY STAR labels for products that must meet the specified minimum energy performance standards under the Energy Efficiency Regulations but are not required to have an EnerGuide label affixed. The voluntary EnerGuide label is used by the industry on promotional material only (not on the equipment). Companies that want their products to bear the ENERGY STAR label must demonstrate that the products meet the eligibility criteria and performance levels for the label (i.e., meet the ENERGY STAR standard).
Evaluation objectives and methodology

Covering 2004–05 to 2008–09, this evaluation was undertaken as part of NRCan's ongoing evaluation cycle and to support NRCan's commitment to provide input into the Clean Air Regulatory Agenda Theme of the Clean Air Agenda. The evaluation methodology included a document review, a literature review, interviews with 30 key informants, and 11 case studies.

Findings
Relevance

The Equipment Sub-Sub Activity aligns closely with the federal government's priorities and NRCan's mandate and objectives. By contributing to the reduction of GHG emissions in Canada, the Equipment Sub-Sub Activity supports the federal government's commitment to reduce GHG emissions. In addition, NRCan's mandate is, "to enhance the responsible development and use of Canada's natural resources and the competitiveness of Canada's natural resources products".1 The Equipment Division supports this mandate by reducing energy use and therefore reducing reliance on fossil fuels, the largest source of GHGs.

The Equipment Sub-Sub Activity plays an important leadership role for the provincial governments and utilities. The federal minimum energy performance standards2 and labelling programs provide an energy efficiency standard that provinces use as a reference for their own standards and energy efficiency programming. The centralization of standards setting, labelling, and enforcement is a major cost saving for provinces/territories wishing to create policy in this area and creates a national framework for energy policy related to equipment efficiency.

As an example, the federal equipment labelling programs (EnerGuide and ENERGY STAR) have been widely used by the provincial utilities in their demand management programs. The utilities have taken advantage of the ENERGY STAR label to model their incentive programs, alleviating them of the need to develop and maintain separate standards.

Another important leadership contribution of the federal government is the coordination it maintains with provinces and outside partners, such as the U.S. This creates a strong bond with these partners and serves as an improved framework for compliance and information dissemination in Canada.

Performance

Evidence from the literature review, a review of equipment efficiencies in Canada, and departmental projections suggest that minimum energy performance standards, and labelling activities will contribute to lower GHG emissions more than would have occurred in the absence of such a program. While energy use has continued to increase in the residential, commercial, and industrial sectors, the evaluation concludes that energy use would be much higher without the increases in energy efficiency of energyusing products. The Equipment Sub-Sub Activity continues to introduce and increase the stringency of minimum energy performance standards and ENERGY STAR standards, and therefore continues to decrease GHG emissions.

NRCan programming (by itself and in support of provincial initiatives) has encouraged market transformation that is evident with changes in consumer behaviour towards the purchase of more energyefficient equipment in Canada. The provincial governments and utilities are undertaking several equipment energy efficiency activities that are either partly funded by NRCan or build on the ENERGY STAR label being used by NRCan programs.

The change in consumer preference induces retailers to demand more energyefficient products from manufacturers. The ENERGY STAR and EnerGuide labels have also become effective branding tools for suppliers and those who can meet and exceed the standard experience increased brand equity that confers a competitive advantage. Adopting an ENERGY STAR program with levels of efficiency (e.g., gold, silver, and bronze) could create even more product differentiation that may offer additional incentives for manufacturers to introduce innovations to reduce energy intensity of appliances even further.

While there are several ways to reduce GHG emissions, minimum energy performance standards and labelling activities are costeffective. That is why many of the key informants strongly supported the continuation and even expansion of the Equipment Program. Most of the focus of the Equipment Division has been on residential and commercial energyusing products; however, a few key informants indicated that more focus on industrial equipment would be beneficial.

It is also always important for the Equipment Division to consult with industry to introduce feasible increases in energy efficiency standards. Raising standards too aggressively may cause some manufactures to leave the market, conferring additional market power on those that remain. This could lead to increased prices, which could undermine the benefits of the Program for the consumer.

Conclusion

The Equipment Sub-Sub Activity implements standards and voluntary promotional and labelling programs in an effort to increase the minimum energy efficiency of equipment manufactured and supplied by suppliers, and therefore purchased by consumers. Increasing the energy efficiency of equipment leads to reductions in energy use and associated GHG emissions. The current program administered by the Equipment Division—the Energy Efficiency Standards and Labelling Program—is expected to reduce annual GHG emissions by between 5.2 and 5.8 megatonnes (Mt) by 2020.

Recommendations, Management Response, and Action Plan
Recommendations Action Plan Responsible Official / Sector (Target Date)
  1. As future program directions are examined, consideration should be given to examining programming gaps and opportunities identified in the evaluation, for example:
    • programming in other areas subject to the authority of the Energy Efficiency Act; and
    • influencing consumer energy use behaviour to reduce the rebound effect.

Agreed.

The Program will explore these gaps and opportunities in the context of future program direction.

ADM, Energy Sector

To be implemented immediately, as opportunities arise. Strategic Evaluation Division will followup on this recommendation in July 2011.
  1. NRCan should better track outcomes to confirm the value of the Program.
    • Could be accomplished by measuring GHG reductions based on historical data (i.e., actual uptake) from the implementation of minimum energy performance standards or labelling activities and comparing them to the forecasted estimates within the capacity to project and verify.

Agreed.

The Program already undertakes an assessment of historical data using industrysupplied sales data as a basis for projections. Where products have been subjected to successive standards, a market analysis is conducted before each new standard. New benchmarks and shipment volumes are established. This provides a time series of market impacts against which projections are compared. The Program will continue this practice and seek opportunities to expand it.

ADM, Energy Sector

To be implemented immediately, as opportunities arise. Strategic Evaluation Division will followup on this recommendation in July 2011.
  1. NRCan should reduce the monitoring of ENERGY STAR awareness to biannual (instead of annually) and continue to conduct discrete choice analyses.

Agreed.

The Program will implement this recommendation. Thus, the next study to monitor ENERGY STAR awareness will be conducted in 2012 on a biannual schedule.

ADM, Energy Sector

To be implemented immediately. Strategic Evaluation will followup on this recommendation in July 2011.
  1. NRCan should continue coordination with the provinces and the provincial utilities to further align federal and provincial programs to increase effectiveness (for example, by decreasing confusion among consumers and suppliers, which was noted as a potential issue).

Agreed.

The Program will continue coordination with the provinces and provincial utilities.

ADM, Energy Sector

To be implemented immediately. Strategic Evaluation Division will followup on this recommendation in July 2011.
  1. NRCan should continue consultations with relevant stakeholders (including industry) to introduce feasible increases in energy efficiency standards.

Agreed.

NRCan will continue consultations with relevant stakeholders.

ADM, Energy Sector

To be implemented immediately. Strategic Evaluation Division will followup on this recommendation in July 2011.

1.0 Introduction and Background

1.1 Introduction

This report provides the findings of the evaluation of Natural Resources Canada's (NRCan's) Equipment Sub-Sub Activity, which comprises four programs and one interim strategy, intended to reduce the energy used by equipment in Canada, thereby reducing GHG emissions. Covering 2004–05 to 2008–09, this evaluation was undertaken as part of NRCan's ongoing evaluation cycle and to support NRCan's commitment to provide input into the Clean Air Regulatory Agenda Theme of the Clean Air Agenda (CAA) evaluation.

1.2 Overview of the Equipment Sub-Sub Activity

The main objective of the Equipment Sub-Sub Activity is, "to gradually exclude the least efficient energyusing equipment from the market and to influence consumers to select, and manufacturers to produce, energyefficient products that perform above the minimum standards".3The Equipment Sub-Sub Activity undertakes various activities to reach the objective, centering around regulatory and nonregulatory programming aimed at increasing the efficiency of energyusing products in the residential, commercial/institutional, and industrial sectors. Increasing the energy efficiency of equipment will ultimately lead to reductions in GHG emissions, which is also a objective of the Equipment Sub-Sub Activity.4,5

GHG emissions in Canada have been trending upwards since 1990. Table 1 illustrates trends in GHG emissions in Canada in 1990 and 2006 by sector, focusing on activities that exhibited interesting or important trends over this period of time.

Table 1: Canada's Greenhouse Gas (GHG) emissions by sector and activity, 1990 & 2006 (Megatonnes carbon dioxide equivalent = Mt CO2e)
  1990
(Mt CO2e)
2006
(Mt CO2e)
Growth, 1990 2006
Residential 69.3 69.6 0.4%
Major appliances 9.3 7.7 17.2%
Other appliances* 1.8 3.8 116.0%
Commercial/institutional 47.7 60.4 26.5%
Lighting 6.4 6.0 6.0%
Space cooling 1.7 4.3 151.6%
Industrial 141.7 161.5 14.0%
Mining 21.6 40.8 89.4%
Pulp and paper 24.2 17.2 28.9%
Source: NRCan (2009h)
* Includes small appliances such as televisions, video cassette recorders, digital video disc players, radios, computers, and toasters.

Emissions in the residential sector grew only 0.4% between 1990 and 2006, due in large part to increased efficiency in space and water heating and major appliances.6 Total emissions from this sector remained relatively stable in spite of the following developments:

  • energy consumption associated with lighting and space cooling increased, due largely to a 19% increase in living space in houses produced since 1990;7
  • the number of appliances operated by Canadian households increased by 38% between 1990 and 2006;8 and
  • GHGs from "other appliances", such as televisions, digital video disc players, radios, and computers, more than doubled between 1990 and 2006.

GHG emissions in the commercial/institutional sector grew 26.5% between 1990 and 2006, largely due to increased energy demand associated with space and water heating, auxiliary equipment, and space cooling. Higher energy demand linked to heating/cooling is consistent with an overall increase in floor space in the sector over this period of time, while increased emissions from auxiliary equipment has resulted primarily from the increased use of computers and other electric devices.9 Improved energy efficiency considerably offset the overall rise in energy use. For example, in 2005, improved efficiency in such items as windows, lighting, and office equipment reduced energy consumption by 75.4 petajoules (PJ) and cut GHG emissions by 4.3 Mt CO2 equivalent.10

Emissions in the industrial sector increased 14.0% between 1990 and 2006, primarily due to a significant increase in industrial activity over the same period.11 The rapid growth in GHGs from the mining sector since 1990 is primarily due to an increase in upstream mining, most notably the oil sands.12 The large decline in emissions from the pulp and paper industry was driven by a transition from heavy fuel oil to other fuel sources. Growth in industrial GHG emissions was offset by shifts towards less energyintensive industries and less polluting forms of energy, and by investments in more energyefficient equipment and practices; in 2005 alone, improved energy efficiency reduced Canadian energy consumption by 347.3 petajoules (PJ).13

While there may be ways to reduce GHG emissions other than improving the energy efficiency of equipment, they are not necessarily as costeffective, as easy to implement, or under the jurisdiction of the federal government. For example, increasing electricity prices would encourage consumers to conserve energy and purchase more energyefficient products; however, electricity prices are under the jurisdiction of the provinces. Another example would be to implement carbon pricing. While this is an option for the federal government, it is not currently instituted in Canada. It is also not clear if it would be easier to implement or more costeffective than the activities undertaken by the Equipment Division.

Increasing the energy efficiency of energyusing products is a continuous cycle. The steps of the cycle include:

  1. the use of nonregulatory measures such as promotional and incentive programs to increase the supply and purchase of highefficiency energyusing products that outperform the minimum energy performance standards;
  2. the initial introduction of a minimum energy performance standard14 for an energyusing product; and
  3. the resetting of minimum energy performance standards to higher efficiency levels once sales of these high energyefficient products have gained a critical proportion of the market share.

The Equipment Division administered several programs during the evaluation period. It also administered the funding for some projects under other programs that were not solely devoted to equipment efficiency. The programs and their years of operation are presented in Table 2.

Table 2: Historical overview of the Equipment Sub-Sub Activity
Program 2001
-02
2002
-03
2003
-04
2004
-05
2005
-06
2006
-07
2007
-08
2008
-09
2009
-10
2010
-11
Preevaluation Evaluation Period Postevaluation
Accelerated Standards Program (ASAP)                    
EnerGuide for Industry                    
Enhanced Equipment Market Transformation (EEMT)                    
Climate Change Interim Strategy (CCIS)                    
Energy Efficiency Standards and Labelling Program                    
Other funding programs
Opportunities Envelope (OE)                    
Security & Prosperity Partnership (SPP)                    

Although the programs administered under the Equipment Division changed during the evaluation period, the activities of the Equipment Division remained virtually unchanged. That is the overall objectives and intended outcomes remain similar.15

Several Acts, agendas, and other initiatives play an important role in the development and operation of the Equipment Sub-Sub Activity.

  • Energy Efficiency Act – Canada's Energy Efficiency Act was introduced in 1992 (amended in September 2009) and has the goal of eliminating the least energyefficient products from the Canadian marketplace. The Act provided the Government of Canada with two authorities:
    • to make and enforce standards for the performance of energyusing products that are imported to Canada or shipped across provincial or territorial borders for the purpose of sale or lease (Section 25 of the Energy Efficiency Act); and
    • to set labelling requirements for energyusing products so consumers can compare the energy efficiency of various models of the same product.16
  • Energy Efficiency Regulations – In accordance with the Energy Efficiency Act, the Energy Efficiency Regulations were introduced in 1995 and set minimum energy performance standards for several energyusing products. The Energy Efficiency Regulations have been amended several times to include new and more stringent standards.
  • Clean Air Regulatory Agenda – The Clean Air Regulatory Agenda involves the participation of four Canadian federal departments (Environment Canada, Transport Canada, NRCan, and Health Canada) to reduce GHG and other emissions from transportation, key industrial sectors, and consumer products.17 Over the fouryear lifespan of the Initiative (April 1, 2007 to March 31, 2011), three amendments to the Energy Efficiency Regulations will introduce new regulations to address about 20 unregulated products, including commercial clothes washers and boilers, and will increase the stringency for about 10 products, including residential dishwashers and dehumidifiers.18
  • Clean Air Agenda – The Clean Air Regulatory Agenda is part of a larger initiative–the CAA, which is the Government of Canada's action plan to achieve progress and sustainability for Canada's environment. Commenced in April 2007, it is a fouryear, $1.9billion interdepartmental initiative that engages multiple environmental issues in order to secure a clean and healthy natural environment for all Canadians.19
1.2.1 Standards and Mandatory Labelling

Standards

The Equipment Sub-Sub Activity develops new standards and increases the stringency of existing standards that set minimum energy performance standards for residential, commercial, and industrial energy-using products. The minimum energy performance standards are developed to eliminate the least energy-efficient products from the Canadian market, and therefore reduce the amount of GHG emissions released into the Earth's atmosphere.

The Energy Efficiency Regulations were implemented in 1995 and introduced the first set of equipment energy efficiency standards. The standards were based on national standards and testing methods developed by the Canadian Standards Association (CSA) and included setting minimum energy performance standards for products such as appliances, lighting, and heating and air conditioning equipment.20,21

The Energy Efficiency Regulations have been amended 10 times, with the latest amendment published on December 24, 2008. Each amendment introduces new standards and/or increases the stringency of existing standards.22 Within this evaluation period (2004-05 to 2008-09), three amendments have been published:

  • Amendment 8 (published September 22, 2004): increased the minimum energy efficiency standards of electric water heaters, gas water heaters and clothes washers.23
  • Amendment 9 (published November 15, 2006): established minimum energy performance standards for commercial reach-in refrigeration, beverage vending machines, chest freezers with automatic defrost, and automatic defrost refrigerator-freezers. The amendment also introduced more stringent performance standards for packaged terminal air conditioners and heat pumps; large air conditioners, heat pumps, and internal water loop heat pumps; and central air conditioners and heat pumps less than 19 kW (65,000 Btu/h).24
  • Amendment 10, which is the first of three amendments that will be implemented under the Clean Air Regulatory Agenda, was published on December 24, 2008. It increased the stringency of existing minimum energy performance standards for residential gas furnaces, residential dehumidifiers, residential dishwashers, and commercial icemakers. It also introduced new minimum energy performance standards for commercial clothes washers, torchieres (floor lamps), ceiling fan lighting, traffic signal modules and pedestrian modules, and commercial and industrial gas unit heaters. Effective in 2012, a new minimum energy performance standard will be introduced specific to general service lamps.25

The two remaining amendments under the Clean Air Regulatory Agenda (Amendment 11 and 12) will be published by March 31, 2011.26

Standards development work involves extensive consultation with stakeholders including: utilities; provincial, federal (Canada, U.S., Mexico), and other governments; manufacturers; and industry associations. These consultations often result in energy-using standards that are harmonized or more closely aligned with those in other jurisdictions. For example, the Equipment Division works closely with provinces throughout the regulatory process to ensure provincial and federal standards are as aligned as possible. It is important to note, however, that not all provinces have their own regulations, and therefore, the federal standards set a base for the whole country.

Similarly, most of Canada's minimum energy performance standards are the same as the United States. Since there is a large amount of trade between provinces and with the United States, similar standards ease the regulatory burden on manufacturers and avoid consumer confusion.27 In addition, if the federal standards were below those of the United States, Canada (mainly the provinces that do not have their own standards) would potentially become dumping grounds for less energy-efficient products from the United States. On the other hand, if the federal standards were above those of the United States, Canada would potentially have product shortages, since many of the manufacturing companies are located in the United States and would focus on constructing equipment that meets their minimum energy performance standards.

Mandatory Labelling

The Energy Efficiency Regulations require that an EnerGuide label be displayed on all major electrical household appliances and room air conditioners imported into Canada or shipped across provincial/territorial borders for the purpose of sale or lease. The EnerGuide label provides information that allows consumers to compare the energy efficiency of different models within a product class28:

  • The household appliance EnerGuide label indicates the estimated annual energy consumption of the product in kilowatt hours (kWh).
  • The room air conditioner EnerGuide label indicates the energy efficiency ratio (EER) of the product. The energy efficiency ratio is based on a Canadian Standards Association test procedure that manufacturers are required to follow. A higher energy efficiency ratio indicates a higher energy-efficient product.
  • General service incandescent reflector lamps, ellipsoidal reflector and bulged reflector lamps, compact fluorescent lamps, and general service lamps (i.e., common light bulbs) must display mandatory text on the package's principle display panel when they are imported into Canada or manufactured in Canada and transported across provincial/territorial borders.

The major electrical household appliances required to display the EnerGuide label include:

  • clothes dryers;
  • clothes washers;
  • integrated over/under washer-dryers;
  • dishwashers;
  • electric ranges;
  • freezers; and
  • refrigerators and combination refrigerator-freezers.29

Suppliers, including manufacturers, importers, and vendors who import or ship products requiring a label across provincial/territorial borders, must ensure the label is affixed to the product before it leaves their possession.

Compliance

NRCan uses a variety of monitoring activities to ensure that dealers comply with requirements under the Energy Efficiency Act and Regulations for regulated products that are imported into Canada or shipped across provincial/territorial borders. NRCan relies on third-party certification and energy efficiency verification marking that must be on all regulated equipment, as well as energy efficiency reports submitted by dealers, and import information transmitted by the Canada Border Services Agency (CBSA) to NRCan. Therefore, it is not necessary for NRCan to test each individual product that is imported or shipped to ensure that it meets the minimum performance levels. Dealers must comply with specific requirements under the legislation. Dealers must:

  • Ensure the product meets the energy efficiency standard specified in the Energy Efficiency Regulations.30
  • Ensure that an EnerGuide label or lighting product label is affixed to the product if required.
  • Ensure the product bears an energy efficiency verification mark, which ensures the energy performance of the product has been verified by a certification body accredited for energy efficiency verification by the Standards Council of Canada (SCC) (e.g., the Canadian Standards Association).
  • Ensure an energy efficiency report has been filed with NRCan before products are shipped inter-provincially or imported into Canada if the product model is not already in NRCan's database. If the product is not in the database, NRCan ensures that the product meets the standards and adds it to the database.
  • Provide the necessary import information (e.g., name of product, model number, brand, address of dealer importing product, purpose for which product is being imported) to the CBSA on the customs release document when importing products into Canada.31

In general, NRCan can implement enforcement measures if necessary, including:

  • preventing the importation of non-compliant products to Canada;
  • removing an illegal product from Canada; and
  • prosecuting serious violations.
1.2.2 Voluntary labelling and promotion

In addition to developing regulations, the Equipment Sub-Sub Activity also promotes the use of energy-efficient products through the promotion of the voluntary EnerGuide and ENERGY STAR labels.

Voluntary labelling

Voluntary EnerGuide labels were introduced in 1997 for gas furnaces, central air conditioners, heat pumps, and oil furnaces, and in 2003 for gas fireplaces.32 While these products must meet specified minimum energy performance standards under the Energy Efficiency Regulations, there is no requirement under the regulations for them to have an EnerGuide label affixed. This voluntary EnerGuide label is used by the industry on promotional material only, not on the equipment. It is therefore the dealer's choice to include an EnerGuide label on promotional material. The advantage to the dealer of using the label to promote their product is energy-efficient is that it provides consumers with comparative energy efficiency information for the specific product. The voluntary EnerGuide labels have the same appearance and provide the same information as the mandatory EnerGuide labels.

In 2001, the ENERGY STAR label was introduced in Canada. The ENERGY STAR label is the international symbol for energy efficiency and includes the following participants: Canada, the United States, Australia, New Zealand, Japan, Taiwan, and the European Union.33 ENERGY STAR labels are placed on products that meet or exceed premium levels of efficiency.

In Canada, NRCan's Office of Energy Efficiency (OEE) administers, promotes, and monitors the use of the ENERGY STAR label.34 While the ENERGY STAR specifications are generally set by the Environmental Protection Agency (EPA) in the United States, the OEE has – in agreement with the United States Department of Energy (DOE) and EPA) – developed unique criteria (i.e., ENERGY STAR standards) for products. For example, the OEE developed unique ENERGY STAR specifications for windows in Canada in response to Canada's specific climate. Also, the OEE, in agreement with the DOE and the EPA, developed criteria for decorative light strings and heat recovery ventilators.

Companies that wish to have their products bear the ENERGY STAR label must demonstrate that the products meet the eligibility criteria and performance levels for the label. These levels are periodically updated to encourage manufacturers to strive for more efficient products and to ensure that ENERGY STAR labels continue to be affixed to only the most efficient products. The energy efficiency performance levels for products in Canada are, for the most part, harmonized with the United States criteria, and therefore, most products that bear the ENERGY STAR label in the United States also meet the ENERGY STAR criteria in Canada.

Canada has also integrated the ENERGY STAR label with the EnerGuide label for major household appliances and room air conditioners. While consumers can use the EnerGuide label to determine the energy efficiency of a product in comparison to similar equipment, the ENERGY STAR symbol on the EnerGuide label assures the consumer that they are purchasing the most energy-efficient product available.35

ENERGY STAR has become a highly valued brand, with manufacturers keen to win the right to place this designation on their products and retailers keen to include these products in their merchandise. Research by NRCan has shown that ENERGY STAR has high consumer recognition and consumers are willing to pay a price premium for equipment with the ENERGY STAR logo.36 In effect, ENERGY STAR has become a brand in the sense that the logo conveys key product attribute information for the consumer.

Promotion

The Equipment Sub-Sub Activity uses several different methods to promote the EnerGuide and ENERGY STAR labels, whether through promotion directly from the Department or by a third party through grants and contributions provided through the Equipment programs. Promotional activities have included:

  • providing information for consumers, retailers, and vendors (e.g., EnerGuide directories listing energy ratings for major household appliances and room air conditioners, online directories for appliances and heating and cooling equipment);
  • providing financial incentives to assist the purchase and sale of ENERGY STAR products to generate consumer and vendor interest in high energy-efficient products;
  • supporting pilot and demonstration products that validate the savings and benefits of high energy-efficient products;
  • supporting outreach programs delivered with partner organizations to encourage early retirement of older high energy-consuming equipment; and
  • developing procurement programs and training and educational materials promoting the specification of high energy-efficient products by institutional equipment purchasers.37

Stakeholders involved in the promotional activities (often through grants and contributions) include utilities, community organizations, and provincial governments.

1.3 Expected Results

The expected results and performance indicators for the Equipment Sub-Sub Activity are listed in Table 3.

Table 3: Expected results and performance indictors for the Equipment Sub-Sub Activity
Expected results Performance indicators
Improved average energy consumption of new equipment Average energy consumption of new versus old appliances
Year-to-year improvement in energy consumption of new equipment
Accelerated stock turnover of less efficient equipment Increase in stock retirement rate – average age of stock
Energy savings due to regulations and programming

Estimated energy savings from regulations and programming
Programs*

  • Accelerated Standards Action Program = 37.19 PJ/year in 2010
  • EnerGuide for Industry = 19.00 PJ/year in 2010
  • Energy Efficiency Standards and Labelling Program = 13.4 to 14.9 PJ/year by 2011 (66.63 PJ/year in 2020)

Regulations

  • Amendment 8 = 16.2 PJ/year in 2010 (42.67 PJ/year in 2020)
  • Amendment 9 = 1.64 PJ/year in 2010 (7.17 PJ/year in 2020)
  • Amendment 10 = 6.09 PJ/year in 2010 (88.10 PJ/year in 2020)
Reduction of the environmental impact of energy use by equipment

Estimated GHG emissions reductions
Programs*

  • Accelerated Standards Action Program = 2.8 Mt/year in 2010
  • EnerGuide for Industry = 1.4 Mt/year in 2010
  • Energy Efficiency Standards and Labelling Program = 1.4 to 1.6 Mt/year by 2011 (5.2 to 5.8 Mt/year in 2020)

Regulations

  • Amendment 8 = 1.29 Mt/year in 2010 (3.61 Mt/year in 2020)
  • Amendment 9 = 0.16 Mt/year in 2010 (0.55 Mt/year in 2020)
  • Amendment 10 = 0.40 Mt/year in 2010 (9.67 Mt/year in 2020)
* The estimated energy savings and GHG reductions from the programs listed expand past the evaluation period. Energy savings and GHG reduction estimates were not provided for the Enhanced Equipment Market Transformation Program and the Climate Change Interim Strategy.
Source: NRCan, 2006c, p. 25; NRCan, 2009g, p. 13.

It is important to note that, common to most programs under the Clean Air Agenda, GHG reduction outcomes are estimated and not directly measured. Since it would be extremely costly to directly measure GHG emissions from equipment, benchmarks are used estimate achieved reductions in GHG emissions. Thus, the majority of the GHG emissions reductions estimates conducted by the Equipment Sub-Sub Activity are forecasts of expected reductions.

1.4 Governance Structure

The Equipment Sub-Sub Activity forms part of NRCan's Program Activity Architecture (PAA), as shown in Table 4.

Table 4: Situating energy-efficient equipment within NRCan's Program Activity Architecture>
Departmental Strategic Outcome Environmental Responsibility: Canada is a world leader on environmental responsibility in the development and use of natural resources
Program Activity Clean Energy
Sub-Activity Energy Efficiency and Alternative Transportation Fuels
Sub-Sub Activity Equipment

The Equipment Sub-Sub Activity is managed by the Equipment Division in the OEE. The Equipment Division formed half of the Housing and Equipment Division before they were separated in April 2007.

1.5 Resources

Over the evaluation period of 2004–05 to 2008–09, total expenditures for the Equipment Sub-Sub Activity were $50.1 million. Of this, $22.5 million (45%) was for grants and contributions. As illustrated in Table 5, the Equipment Division also had some A-Base funding. Financial data for A-Base funding was only available for 2008–09 (actual spending = $1,264,000); however, projects have been funded under A-Base funding since 2006, according to the list of contribution agreements (CAs) that fell in the evaluation period.

Table 5: Equipment Sub-Sub Activity expenditures, 2004-05 to 2008-09 (millions)
Program 2004–05 2005–06 2006–07 2007–08 2008–09 Total
Accelerated Standards Action Program
Total $5.7 $6.7 n/a n/a n/a $12.4
Gs&Cs $2.5 $3.4 n/a n/a n/a $5.9
% Gs&Cs 44% 51% n/a n/a n/a 48%
EnerGuide for Industry
Total $0.4 $0.5 n/a n/a n/a $0.9
Gs&Cs n/a n/a n/a n/a n/a n/a
% Gs&Cs n/a n/a n/a n/a n/a n/a
Enhanced Equipment Market Transformation Program
Total $1.2 $1.9 n/a n/a n/a $3.1
Gs&Cs $0.7 $1.0 n/a n/a n/a $1.7
% Gs&Cs 58% 53% n/a n/a n/a 55%
Climate Change Interim Strategy
Total n/a n/a $8.9 n/a n/a $8.9
Gs&Cs n/a n/a $2.9 n/a n/a $2.9
% Gs&Cs n/a n/a 33% n/a n/a 33%
Energy Efficiency Standards and Labelling Program
Total n/a n/a n/a $6.8 $6.5 $13.3
Gs&Cs n/a n/a n/a $0.9 $1.0 $1.9
% Gs&Cs n/a n/a n/a 13% 15% 14%
Opportunities Envelope
Total n/a $4.1 $5.8 n/a n/a $9.9
Gs&Cs n/a $4.1 $5.8 n/a n/a $9.9
% Gs&Cs n/a 100% 100% n/a n/a 100%
Security & Prosperity Partnership
Total n/a n/a n/a n/a $0.3 $0.3
Gs&Cs n/a n/a n/a n/a n/a n/a
% Gs&Cs n/a n/a n/a n/a n/a n/a
A-base funding
Total n/a n/a not avail. not avail. $1.3 $1.3
Gs&Cs n/a n/a not avail. not avail. $0.2 $0.2
% Gs&Cs n/a n/a not avail. not avail. 15% 15%
Total
Total $7.3 $9.6 $24.3 $6.8 $8.1 $50.1
Gs&Cs $3.2 $4.9 $18.3 $0.9 $1.2 $22.5
% Gs&Cs 44% 51% 75% 13% 15% 45%
Note: Gs&Cs = grants and contributions; n/a = not applicable; not avail. = not available
Source: Natural Resources Canada, Office of the Sector Financial Advisor, Energy. Updated Jan 2010. Requested Financial Information for the Energy Efficiency Equipment Evaluation (2004-05 – 2008-09).

Figure 1 shows the allocation of the Equipment Sub-Sub Activity's $50.1 million expenditures by program.

Figure 1
Total: $50.1 million

Figure 2 shows the allocation of the Equipment Sub-Sub Activity's $50.1-million expenditures by expenditure type.

Figure 2
Total: $50.1 million

2.0 Evaluation Approach and Methodologies

2.1 Evaluation Scope and Objectives

This evaluation assessed issues related to the:

  • Relevance of energy efficiency programs in the Equipment Sub-Sub Activity in terms of addressing an actual need, in relation to federal government priorities, and in relation to the role of the federal government.
  • Performance of the Equipment Sub-Sub Activity programs. That is, the degree to which the programs have achieved their expected results, whether there have been any unintended results, as well as their economy and efficiency.

The evaluation covered the Department's direct spending on equipment energy efficiency over the period of 2004-05 to 2008-09, with an emphasis on the last two fiscal years.

2.2 Evaluation Methods

In order to assess these three issues, the evaluation used the following four data collection tasks:

  • document review;
  • literature review;
  • key informant interviews; and,
  • case studies.

Key informant interviews

Using a list of potential key informants provided by NRCan, interviews were completed with 30 individuals from the following groups:

  • NRCan chiefs, senior management, and staff (7 interviews);
  • provincial governments/utilities (10 interviews);
  • stakeholders (9 interviews); and
  • retailers (4 interviews).

The findings of the key informant interviews have been reported using the following scale.

Key informant interviews

It is important to note that, in analyzing the findings from the key informant interviews, two important situations can occur: first, there is high agreement across all groups of key informants, and second, a single respondent offered a perspective, based on experience or a unique position, that materially clarified an aspect of the Program or context thereby assisting the evaluation to respond to important questions. Further, since not all groups of key informants were asked to respond to each evaluation question, and since different groups of key informants may have diverging opinions, findings are linked to the key informant group that provided the information.

Case studies

A total of 11 case studies were completed. Nine of the case studies were projects funded by the Equipment Division through contribution agreements, while the other two case studies examined other Equipment Division activities more generally. See Annex 1 for a full list of the case studies undertaken as part of this evaluation.

3.0 Evaluation Findings

This section provides the evaluation findings, organized by evaluation question, in two subsections: relevance and performance.

3.1 Relevance

Summary

The Equipment Sub-Sub Activity aligns closely with the federal government's priorities and NRCan's mandate and objectives. By contributing to the reduction of GHG emissions in Canada, the Equipment Sub-Sub Activity supports the federal government's commitment to reduce GHG emissions. In addition, NRCan's mandate is," to enhance the responsible development and use of Canada's natural resources and the competitiveness of Canada's natural resources products".38 The Equipment Division supports this mandate by reducing energy use and therefore reducing reliance on fossil fuels, the largest source of GHGs.

The Equipment Sub-Sub Activity plays an important leadership role for the provincial governments and utilities. The federal minimum energy performance standards and labelling programs provide an energy efficiency standard that provinces use as a reference for their own standards and energy efficiency programming. The centralization of standards setting, labelling, and enforcement is a major cost saving that also creates a national framework for energy policy.

Another important leadership aspect within the federal government is the coordination it maintains with provinces and outside partners, such as the U.S. It ensures a strong bond with these partners and proper compliance and information dissemination in Canada.

Evaluation question 1: What environmental needs are the programs trying to address?

  • The Sub-Sub Activity is addressing concerns about climate change by reducing energy use and GHG emissions generated by equipment. It is trying to reduce energy use and GHG emissions by encouraging the manufacturing, sale, and purchase of energy-efficient equipment.

NRCan defines energy efficiency as 'how effectively energy is being used for a particular purpose', adding that 'providing a similar (or better) level of service with less energy consumption on a per-unit basis is considered an improvement in energy efficiency'.39 In this specific context, energy efficiency is the efficiency with which secondary energy is converted into desired energy services at the point of end-use.40 Increasing energy efficiency in appliances and equipment enables users to enjoy a similar level of service while reducing energy use and GHG emissions.

Although the levels of energy use and GHG emissions are increasing in Canada, they would be much higher without the improvements to the energy efficiency of equipment. Table 6 uses NRCan's factorization method to determine the extent to which energy efficiency reduced energy consumption in Canada between 1990 and 2007.

Table 6: Impact of energy efficiency on changes in Canadian energy use, 1990–2007 (PJ)
  Residential Commercial/ Institutional Industrial Total
(a) Energy use in 2007 1,447.20 1,141.57 3,471.59 6,060.36
(b) Energy use minus energy efficiency improvements, 2007 1,825.40 1,280.28 3,656.38 6,762.06
Ratio: [(b)-(a)]/(b) 0.21 0.11 0.05 0.10
Source: NRCan (2009j)

This table shows that energy efficiency improvements made substantial contributions to reducing energy use in Canada between 1990 and 2007, as evidenced by the last row of the table, which reports a ratio of what energy use in Canada would have been in the absence of improvements in energy efficiency, to what it actually was in 2007. Other things being equal, energy use in the residential sector would have been more than one-fifth higher in the absence of improvements in energy efficiency, while consumption in the commercial/institutional and industrial sectors would have been about 11% and 5% higher, respectively. Overall, energy consumption would have been 10% higher. Other things being equal, it is reasonable to conclude that the programs within the Equipment Sub-Sub Activity contributed to this.

Projected reduction in energy use and GHG emissions

The following examples demonstrate the Equipment Program's efforts to reduce energy use and GHG emissions:

  1. The expected energy savings achieved by the Energy Efficiency Regulations and their amendments (Amendments 1 to 10) in 2010 is 178.15 PJ and by 2020 is 240.86 PJ. These energy savings are expected to result in GHG emissions reductions of 25.60 Mt by 2010 and 34.29 Mt by 2020.41
  2. Under the Clean Air Regulatory Agenda, three amendments (Amendments 10 to 12) to the Energy Efficiency Regulations are expected to result in energy savings of 13.37 to 14.85 PJ/year and GHG emissions reductions of 1.4 to 1.5 Mt/year in 2010–11.42
  3. It is expected that the Energy Efficiency Standards and Labelling Program will result in energy savings of 66.626 PJ/year and GHG emissions reductions of 14.1 Mt by 2020.43
  4. A 2002 NRCan study indicated that the EnerGuide labelling program results in energy savings equivalent to 30% of the regulatory impact.44
  5. According to an ENERGY STAR participant survey, the efforts of respondent ENERGY STAR participants during 2008 were expected to reduce GHG emissions by 254,000 tonnes annually.45

Thus, by implementing regulations (including amendments) and promoting labelling, the Equipment Sub-Sub Activity is expected to have an impact on both GHG emissions reductions and energy savings, particularly if the targets specified above continue to be achieved.

Risks from not reducing energy use and GHG emissions from equipment

Past efforts to improve energy efficiency in equipment and appliances have helped counteract increased energy consumption and GHG emissions resulting from a growing population and economy. In the absence of policies encouraging further improvements in energy efficiency, Canada faces the following risks:

  • Energy consumption and GHG emissions from equipment and appliances may grow more rapidly than in the past, increasing Canadians' energy costs and contributing to climate change.
  • Rising emissions from equipment and appliances may jeopardize Canada's ability to meet current and future GHG reduction targets.
  • Substantial financial costs may be involved in providing the additional generating capacity needed to satisfy the incremental energy demand associated with the use of inefficient equipment and appliances.46
  • Canada might become a refuge for inefficient products that cannot be sold elsewhere, due to progressive policy regimes related to energy efficiency in other countries. Such a situation existed in the United Kingdom (U.K.) in the 1990s, where, due to ineffective policy around energy efficiency in equipment and appliances, the country became a "dumping ground for inefficient, and obsolete, German models".47 In turn, this would further contribute to Canada's energy consumption and GHG emissions.

Evaluation question 2: Are the programs consistent with government priorities and NRCan strategic objectives?

  • Yes, the programs directly respond to the federal government's GHG emissions reduction commitments and align with NRCan's clean energy objectives.

Several sources indicate that the activities of the Equipment Sub-Sub Activity are consistent with federal government priorities:

  • Speeches from the Throne – The 2006, 2007, and 2008 speeches from the Throne made commitments to reductions in GHG emissions. In the 2008 Speech, the federal government committed to reducing Canada's total GHG emissions by 20% by 2020, relative to 2006 levels.48,49,50,51
  • Federal budgets – The 2005 to 2009 budgets earmarked funding allocations aimed at reducing GHG emissions and/or increasing energy efficiency. The 2008 budget announced new measures that will fund the implementation of regulations and incentives to reduce GHG emissions, improve air quality, and reduce energy use.52,53,54,55,56
  • The Equipment Sub-Sub Activity is part of the Clean Air Regulatory Agenda, one of the themes under the Clean Air Agenda, which is committed to reducing GHG emissions.

The Clean Air Regulatory Agenda Results Framework further indicates that GHG emissions reductions are a priority of the federal government. The document indicates that pollution control is a national matter because air pollution does not respect political boundaries within and outside the country. The federal government therefore has a clear leadership role for the provinces and an important role as liaison with other countries.57 As a part of the Clean Air Regulatory Agenda, the Equipment Sub-Sub Activity plays a role in these government priorities.

NRCan's annual plans and priorities include measures to reduce GHG emissions through increasing the energy efficiency of equipment. Specifically, NRCan's 2007-08 Report on Plans and Priorities indicated that the Department's clean energy objective was to, "reduce the harmful effects of energy production and consumption that accounts for 85 percent of smog-causing nitrogen oxide emissions and 80 percent of Canada's annual GHG emissions, while generating innovative technologies that Canada can market abroad".58

The 2008-09 Report on Plans and Priorities identified continuing to implement the ecoENERGY programs as a priority.59

Evaluation question 3: Is there a legitimate, appropriate, and necessary role for NRCan in the Program?

  • Yes. NRCan provides a strong leadership role with its standards and mandatory and voluntary labelling activities.

All key informants noted that NRCan has a necessary leadership role in equipment efficiency. Firstly, some of the NRCan key informants noted that no province could support the labelling and branding and have credibility in other jurisdictions or nationally. The creation of these brands by the federal government allows the provinces to develop programs (such as rebates) that link to the target products with this national certification. Increasingly, provincial programming conditions the delivery of incentives on the basis of products having achieved the ENERGY STAR standard.

Most key informants across the four groups also noted that while some of the provinces are active in increasing the energy efficiency of equipment and reducing GHG emissions, other provinces are less active. The federal minimum energy performance standards and labelling programs provide an energy-efficiency standard for the whole country.

NRCan also provides funding through its grants and contributions resources to support projects at the provincial level and for non-government organizations. Evidence from the case studies suggests that several of the projects would not have proceeded without the federal funding and often, in other cases the projects would have gone ahead with diminished capacity (i.e., lower rebate available, smaller program reach, etc.).

Finally, about half of the provincial government/utility and stakeholder key informants noted the important coordination role the Equipment Division can play with provinces and partners (e.g., the U.S.). These key informants indicated that good coordination ensures the following:
  • A strong bond with outside partners – This is evident from Canada's and the United States' coordination on regulations and ENERGY STAR specifications.
  • Proper compliance – This is evident from the Equipment Division's work with the Canada Border Services Agency.
  • Proper information dissemination in Canada – The Equipment Division's strong bond with the provinces informs NRCan of what information needs to be disseminated and provides them with another channel to distribute the information to consumers and suppliers.

Other than its leadership role, most key informants across all four groups also noted that NRCan's commitment support the Government of Canada's commitment to reduce GHG emissions by 17% by the year 2020, relative to 2005 levels, and NRCan's strategic objectives and mandate to undertake activities that protect the environment and promote the responsible use of Canada's natural resources.

Alignment with NRCan's mandate

NRCan "seeks to enhance the responsible development and use of Canada's natural resources and the competitiveness of Canada's natural resources products".60 Thus, the Equipment Sub-Sub Activity sets minimum energy performance standards for several energy-using products and promotes and encourages the purchase of energy-efficient equipment.

Laws, regulations, and policies that frame the role of NRCan

NRCan's energy-efficient equipment activities are undertaken in accordance with the Energy Efficiency Act (1992) and the Energy Efficiency Regulations (1995).

Uniqueness of NRCan's role

At the federal government level, NRCan is the only department with a division that has a mandate to improve the energy efficiency of equipment in the marketplace. While other federal government programs may encourage the use of energy-efficient equipment under the standards set by NRCan, none of them develop their own standards.

While the provincial governments and utilities and non-governmental organizations have their own initiatives and policies relating to the energy efficiency of equipment, NRCan's Equipment Sub-Sub Activity plays a large role in their success. Firstly, many of the initiatives administered through provincial utilities and non-governmental organizations are supported by NRCan. For example, many initiatives, such as incentives and advertising campaigns, exist at the provincial level to encourage the replacement of residential furnaces and boilers for more energy-efficient (ENERGY STAR) furnaces and boilers. NRCan's Equipment Division, provides grants and contributions to the provincial utilities to help them implement these initiatives.

While most key informants across the four groups mentioned other roles groups should play in Canada, all agreed on NRCan's continued importance in the area of the energy efficiency of equipment. At the federal level, key informants agreed that Environment Canada and NRCan should have strong coordination, since they are both dealing with environmental issues, but noted that NRCan should still be the lead on the energy efficiency of equipment. Key informants agreed that industry associations and utilities can play an important role in the promotion of energy-efficient equipment in coordination with NRCan because they have connections with the manufacturers and consumers in their jurisdictions.

At the provincial level, key informants were split on whether provinces should be involved at all in the energy efficiency of equipment. While some key informants felt that provincial standard and incentive approaches are more effective than those taken at the federal level, other key informants indicated that it is the Equipment Division's responsibility to develop and implement standards and procedures for information dissemination in the area of energy efficiency and that provinces/territories should harmonize their actions with the federal government.

Some key informants noted that there is some overlap between NRCan and the provinces. While most of the key informants mentioned that the overlap was positive in the form of top-up incentives at acceptable levels, one respondent said that NRCan should not be involved in delivering incentives at the provincial level.

Evaluation question 4: What is the theoretical rationale for the Program? What is the underlying program logic?

  • To correct market failure through standards and labelling activities.

The theoretical rationale for the Program is the correction of market failure stemming from information deficits/asymmetries and the split incentive problem. If consumers lack the tools needed to make informed purchasing decisions about equipment and appliances, or if the agents who purchase these products are not their end-users, markets will fail to reduce GHG emissions from this source to the extent considered ideal from society's standpoint.

Information deficits/asymmetries and labelling

Consumers cannot directly observe energy use and are often unaware that equipment use ultimately produces GHGs as a by-product. Moreover, energy efficiency is not easily observed by consumers before or after purchasing appliances or equipment61, although it is known to the manufacturers. While manufacturers producing energy-efficient equipment want to communicate information about their products to consumers, the latter cannot critically assess these claims, since they cannot "see" energy efficiency.62,63 Thus, consumers may under-invest in energy efficiency.

Labelling provides consumers with the information required to compare products on the basis of energy efficiency, enabling them to incorporate this factor into their purchasing decision.64 As consumers become increasingly aware of energy efficiency due to the proliferation of labels and other indicators, manufacturers become motivated to compete with one another in designing and supplying efficient equipment and appliances.65,66,67

Voluntary and mandatory labelling and incentives can be effective in the context of a market transformation program. Voluntary initiatives play a key role in improving energy efficiency in equipment and appliances because standards provide no incentive to manufacturers to do more than the minimum required to meet the standard.68 Moreover, because consumers are unlikely to know about the standards, awareness of the importance of energy efficiency as a means of saving money and reducing GHG emissions will remain low.69 In the market transformation model, voluntary initiatives are responsible for pulling the market towards higher levels of efficiency than would be possible through the use of standards alone. Several studies have found, for example, that mandatory and voluntary labelling programs have produced significant energy savings and reductions in energy consumption and GHG emissions.

Two recent studies suggest that there may be opportunities to improve outcomes associated with voluntary initiatives in Canada by raising consumer awareness and increasing efforts to ensure compliance by retailers.

First, a 2005-06 EnerGuide and ENERGY STAR compliance study in 100 Canadian retail stores found that the appropriate use of the EnerGuide and ENERGY STAR labels had diminished significantly over time. A significant proportion of EnerGuide labels reported a level of energy efficiency that diverged from the actual values in the EnerGuide database.70 Similarly, a large proportion of stock keeping units (SKUs) that should have displayed an ENERGY STAR label did not (18%), while a significant proportion of SKUs not entitled to display the label did (7%).71

This study also noted that:

  • The EnerGuide label is often criticized for failing to provide dollar savings information, and reported that, "while most customers understand that the EnerGuide Label is a rating of energy consumption […] for a significant minority of customers the presence of the EnerGuide Label is misinterpreted as an energy efficiency endorsement".72
  • Most retail sales managers had never heard of NRCan's publication Selling EnerGuide and ENERGY STAR Appliances.73

Second, a study that included a survey of Canadians about their awareness of the ENERGY STAR and EnerGuide symbols found that less than half of survey respondents had heard, seen, or read about EnerGuide, although this proportion has increased slightly over time from 37% in 2001 to 41% in 2006.74 The study also found awareness to be higher in older, higher-income, and more educated consumers.75

The findings from these studies suggest that there is substantial scope for improving awareness and understanding of the EnerGuide and ENERGY STAR labels among Canadian consumers and retailers.

Split incentive problems and regulation

Another source of market failure is the "split incentive" problem, where one agent (e.g., a landlord) purchases equipment and appliances on behalf of a second agent (e.g. tenant), who ultimately pays the operating costs. Because the first agent is responsible for the upfront costs of the item—but not the operating costs—he or she will tend to under-invest in energy efficiency.76,77,78

Regulations influence the supply of energy-efficient equipment by requiring manufacturers to meet or exceed specified efficiency levels, eliminating inefficient products from the market.79 As a consequence of the imposition of the standard, manufacturers must improve the level of energy efficiency in their products or withdraw from the market. If it remains profitable for manufacturers to remain in the market, they will supply appliances and equipment embodying higher levels of energy efficiency. Indeed, these improvements are often introduced even before the standard becomes active.80

Gillingham, Newell, and Palmer indicated that, in 2000 alone, standards saved the U.S. 352 billion kWh and reduced GHG emissions by 17.8 Mt.81 Incorporating the cost of administration ($2.51 billion), they estimate that the standards cost approximately $0.0071 per kWh saved.

In Australia, the imposition of minimum energy performance standards in 1999 and 2005 had a marked effect on energy efficiency in refrigerators and freezers, as shown in the diagram below. The diagram also shows that manufacturers responded to increased stringency in the standards well in advance of the date they became binding.

Figure 3: The impact of minimum energy performance standards (MEPS) on efficiency of freezers and fridges in Australia

Figure 3: The impact of minimum energy performance standards (MEPS) on efficiency of freezers and fridges in Australia
Source: EnergyConsult (2006, pp. E-6)

Labelling and regulation

Labelling and standards can be combined to "pull" and "push" appliance and equipment markets towards ever-higher levels of efficiency. Standards "push" the market by removing products falling beneath a specified efficiency threshold, while mandatory and voluntary labelling programs (i.e., EnerGuide and ENERGY STAR) "pull" the market by eliminating information deficits and asymmetries, enabling consumers to make better informed purchasing decisions that incorporate energy efficiency as a consideration, and by encouraging manufacturers to design and supply more efficient appliances and equipment. Other programming, such as provision of incentives, complements standards and labelling programs.

The figure below provides a diagrammatic representation of market transformation, incorporating standards and labelling. As shown, the imposition of the standard (the vertical line), removes the least efficient products from the marketplace. Manufacturers design and produce more efficient products, pushing the supply curve in the diagram upward to the dashed line. Meanwhile, the labelling programs, as denoted by the light grey curve, provide the information consumers need to incorporate energy efficiency into their purchasing decisions; this, in turn, encourages manufacturers to exceed the standard and outperform one another in developing more efficient products.

Figure 4: Effect of voluntary and regulatory measures on markets for appliances and equipment

Figure 4: Effect of voluntary and regulatory measures on markets for appliances and equipment
Source: Wiel and McMahon (2003, p. 1405)

Summary

Market failure results in suboptimal social outcomes. In markets for equipment and appliances, market failure manifests in low rates of improvement in energy efficiency over time, which yields sub-optimal levels of energy consumption and GHG emissions. Where energy conservation and reduced GHG emissions are important policy goals, policy intervention is justified in order to correct market failures.83,84

Labelling and promotional activities under the Equipment Sub-Sub Activity correct information deficits/asymmetries by providing consumers with credible, unbiased information about energy efficiency in equipment and appliances, thereby increasing the consideration they give to energy efficiency in their purchasing decisions.85,86 Regulation addresses the split incentive issue by effectively restricting the buyer to a subset of equipment models that meet a minimum standard for energy efficiency.87

3.2 Performance

Summary

The literature and many of the key informants across all four groups indicated that consumer behaviour is changing toward the purchase of more energy-efficient equipment in Canada. NRCan programming in support of provincial initiatives has in large part encouraged this market transformation. The provincial governments and utilities are undertaking several equipment energy efficiency activities that are either partly funded by NRCan or build on the ENERGY STAR label being used by NRCan programs.

The change in consumer preference induces retailers to demand more energy efficiency products from manufacturers. The ENERGY STAR and EnerGuide labels have also become effective branding tools for suppliers and those who can meet and exceed the standard experienced increased brand equity that confers a competitive advantage. Adopting an ENERGY STAR program with levels of efficiency (e.g., gold, silver, and bronze) creates more product differentiation that may offer increased incentive for manufacturing participation and support.

The literature indicated that the NRCan minimum energy performance standards and labelling activities are expected to result in decreases in GHG emissions. All of the key informants across all four groups agreed that these activities were effective in saving energy and reducing GHG emissions. While energy use has continued to increase in the residential, commercial, and industrial sectors, the evaluation concludes that energy use would be much higher without the increases in energy efficiency of energy-using products. The Equipment Sub-Sub Activity is continuing to introduce and increase the stringency of minimum energy performance standards and ENERGY STAR standards and therefore continuing to decrease GHG emissions.

Table 7 provides the estimated energy savings and GHG reductions from the programs administered by the Equipment Division and the amendments to the Energy Efficiency Regulations that were published during the evaluation period.

Table 7: Estimated Energy Savings and GHG Reductions from Equipment Programs and Regulations*
  Energy Savings in 2010 (PJ/yr) GHG reductions in 2010 (Mt/yr) Energy savings in 2020 (PJ/yr) GHG reductions in 2020 (Mt/yr)
Programs**
Accelerated Standards Program 37.19 2.8 not avail. not avail.
EnerGuide for Industry 19.00 1.4 not avail. not avail.
Energy Efficiency Standards and Labelling Program 13.4 to 14.9 1.4 to 1.6 66.63 5.2 to 5.8
Regulations
Amendment 8 16.2 1.29 42.67 3.61
Amendment 9 1.64 0.16 7.17 0.55
Amendment 10 6.09 0.40 88.10 9.67
* The estimated energy savings and GHG reductions for the programs includes the estimated energy savings and GHG reductions for the regulations; therefore, there is some overlap.
** The estimated energy savings and GHG reductions from the programs listed expand past the evaluation period. Energy saving and GHG reduction estimates were not provided for the Enhanced Equipment Market Transformation Program and the Climate Change Interim Strategy.

Evaluation question 5: Have the voluntary programs increased the behaviour of procurement officers and consumers to use and purchase highly energy-efficient products?

  • Yes, awareness has increased and behaviour is changing.88

Most of the NRCan and stakeholder key informants and a few provincial government/utility and retailer key informants indicated that providing information on the energy efficiency of equipment to consumers increases their likelihood to consider energy efficiency when making a purchase. While key informants noted that energy efficiency may not be the main feature about which consumers are concerned, all else being equal, an ENERGY STAR-certified product may become the product of choice for the consumer.

A recent Canadian discrete choice experiment89 prepared for NRCan determined that the ENERGY STAR qualification is the most important attribute to Canadian consumers purchasing flat screen televisions or refrigerators. For flat screen televisions, the ENERGY STAR label accounted for approximately 20% of consumer choice (slightly ahead of screen size at 19%), and for refrigerators, the label accounted for about 29% of consumer choice. The study also found that, all else being equal, approximately 7 in 10 consumers will select the ENERGY STAR-qualified model over others when selecting either a flat screen television (71%) or a refrigerator (69%).90 Another main finding from the study indicated that about half of the respondents would purchase an ENERGY STAR-qualified flat screen TV at $1,050 over a non-ENERGY STAR-qualified TV for $500. Similarly, half of the respondents indicated that they would purchase an ENERGY STAR refrigerator for $1,400 over a non-qualified model for $500. This discrete choice analysis showed that consumers are willing to pay extra for ENERGY STAR products and that the ENERGY STAR brand has become an important consideration for consumers when purchasing energy-using products.

Another indication that consumer behaviour is changing is the increase in the sale of certain ENERGY STAR appliances in Canada between 2001 and 2005. During this time period, the sale of ENERGY STAR dishwashers increased from approximately 10% to 91%, refrigerators increased from just under 15% to 38%, and clothes washers increased from about 10% to approximately 45%.

A few key informants from each group noted that increases in the sales of ENERGY STAR-certified products are attributed to incentive and rebate programs. They noted that providing information to consumers only changes the purchasing decisions of consumers at the margin and that the majority of consumers will not pay the higher price for an energy-efficient product unless they are compensated.

The case studies provide strong support that the incentive and rebate programs change consumer behaviour toward purchasing energy-efficient equipment. The case study projects that provided incentives or rebates demonstrated good take-up of the programs. For example, the High-Efficiency Heating Equipment Replacement Program administered by Enbridge Gas, that provided an incentive to consumers to upgrade to ENERGY STAR-qualified heating equipment, had 16,025 participants in 2005-06, which was 23% more participants than anticipated.

The literature notes that incentives have an important role as part of market transformation programs. Incentives can extend the reach of programs to parts of the market not addressed by standards and labelling, encourage the retirement of inefficient appliances and equipment, and boost market uptake of energy-efficient products. However, the literature suggests that the results of incentive programs targeting consumers are often coloured by pervasive free-ridership and may be costly to implement and administer. Consequently, they may not always be cost-effective in reducing GHG emissions from equipment and appliances.93,94,95

One of the case studies (the 2004 ENERGY STAR Advertising in Saskatchewan program administered by SaskEnergy) showed the importance of providing both information and an incentive program to encourage consumers to purchase energy-efficient products. A prime rate loan program for ENERGY STAR furnaces and boilers ran concurrently with the 2004 advertising campaign. The advertising campaign reached a vast audience, and there was good uptake of the prime rate loan program.

NRCan also undertakes several EnerGuide and ENERGY STAR awareness surveys. Based on the regularly conducted awareness surveys, for each year between 2004-05 and 2007-08, more than 50% of Canadians were aware of the EnerGuide label.96,97,98,99 While the Reports to Parliament did not provide exact EnerGuide awareness figures, it appears that the awareness of Canadians has remained fairly consistent and over 50% between 2004-05 and 2007-08. These surveys also indicated that between 2001 and 2006, the awareness of ENERGY STAR increased. The results of the surveys are presented in Table 8.

Table 8: Awareness of ENERGY STAR in Canada (2001–2004)
  Nov. 2001 Jan. 2003 Sep. 2003 Nov. 2004 2005 2006
Aware – aided 26% 32% 40% 44% 80%* -
Aware – unaided 13% 17% 25% 29% 36% 48%
* From source: NRCan, 2008b, p. 26. The 80% was estimated based on a bar graph – actual numbers were not provided.
Source: NRCan, 2005a, p. 15; NRCan, 2008b, p. 26; NRCan, 2006b, p. 38; NRCan, 2007c, p. 34

Whether the respondents were aided or unaided, the level of awareness of the ENERGY STAR label continued to increase. While the aided respondents showed an increase of 54% between 2001 and 2005, the unaided respondents showed a 35% increase in awareness between 2001 and 2006. There appears to be no direct indication as to why the aided awareness of ENERGY STAR increased from 44% in November 2004 to 80% in 2005. The continued work by the Equipment Division and provincial utilities to promote the ENERGY STAR label can likely be attributed to a large portion of the increase.

The following studies were conducted outside of Canada to assess the impact of information and labelling on consumer purchasing behaviour around appliances and equipment:

  • Sammer and Wüstenhagen (2006) noted that Swiss consumers are willing to pay premiums of as much as 30% more for washing machines bearing the European Union energy label.
  • Shen and Saijo examined the impact of China's mandatory rank system of energy efficiency labelling on purchasing behaviour by calculating consumers' willingness to pay for a one-efficiency-rank-difference across a number of appliance types. They determined that individuals were willing to pay 576 and 956 renminbi (RMB) (around $89 and $148 CAD respectively) per rank change for new, domestically-produced air conditioners and refrigerators respectively. While the estimates for different types of appliances varied considerably , the authors contend that these and other findings suggest "information provision, at least to some extent, [can] be viewed as a valid means to influence consumers' preferences and consequently their purchasing decisions".101

    Other factors influencing the supply, purchase, and use of energy-efficient equipment

Electricity prices

The literature suggests, and about half of the provincial government/utility key informants and some of the NRCan and retailer key informants agree that consumers respond to increases in the price of electricity by reducing their demand, although the literature concludes that this response emerges only after a prolonged period. Increasing consumer demand for energy-efficient products in response to rising electricity prices could contribute to improving efficiency in equipment and appliances. However, the literature and key informants noted that there have not been significant changes in the demand for energy-efficient equipment due to changing electricity prices in Canada because electricity prices in the country have remained low. In addition, Bernstein and Griffin argue that people might be less responsive to changes in electricity prices in jurisdictions affected by extreme hot or cold because of the utility obtained from space heating and cooling.102

Provincial programming

If programming around energy efficiency in equipment and appliances had not been developed at a federal level, it could have emerged at a provincial level; standards, incentives, and consumer education programs already exist in several provinces, as shown in Table 9. The programs in the table represent only a small proportion of actions being taken by various stakeholders to promote energy efficiency in each jurisdiction.

NRCan is not only openly acknowledged as a source of support for some of these programs, but may also be assisting in the design and implementation of other programs, while not receiving explicit recognition. Many of these programs are also built around the ENERGY STAR label.

Table 9: Summary of provincial energy efficiency initiatives in selected jurisdictions
Jurisdiction Program name Managers Program type Description
British Columbia LiveSmart BC Provincial government Incentive Rebates for audits and retrofits and PST exemptions for ENERGY STAR products
Product Incentive Program B.C. Hydro Incentive Incentives for businesses to replace products with energy-efficient alternatives
Employee Energy Efficiency at Work (E3@Work) NRCan and City of Toronto Awareness/
Education
Promotion of energy-efficient practices around use of office equipment
Ontario The Great Refrigerator Roundup Ontario Power Authority Incentive Collection and recycling of inefficient appliances
Cool Savings Rebate Ontario Power Authority Incentive Offers incentives to replace inefficient cooling & heating equipment with ENERGY STAR products
The Power Savings Event Ontario Power Authority Incentive Instant rebate coupons for energy-efficient equipment & appliances
Ontario Energy Efficiency Act Provincial government Regulation Imposition of minimum energy performance standards for more than 50 product categories
Employee Energy Efficiency at Work (E3@Work) NRCan and City of Toronto Awareness/education Promotion of energy-efficient practices around use of office equipment
Québec Éconologis Agence de l'efficacité énergétique Incentive and awareness/
education
Offers energy efficiency advice and incentives to low-income families
Loi sur l'efficacité énergétique d'appareils fonctionnant à l'électricité ou aux hydrocarbures Provincial government Regulation Energy efficiency regulations applying primarily to residential appliances
Energy Wise Hydro-Québec Incentive and awareness/
education
Incentives for residential, commercial, and industrial customers for a wide range of products, personalized home audits online
Atlantic Canada Efficiency NB (N.B.); takeCHARGE (NL.) Various Awareness/
education programs
Efficiency NB is a government agency providing energy efficiency information and advice; takeCHARGE performs a similar function and also provides incentives
Energy Smart Commercial Buildings Energy Efficiency Program (NB); PEI Energy Efficiency Windows and Doors Grant Program (PEI); Residential Energy Efficiency Program (NL) Various Incentive Incentives for residential and commercial consumers to improve energy efficiency
Energy Efficiency Act (N.B.); Energy Efficient Appliances Act (N.S.) Provincial governments Regulation The scope and stringency of energy efficiency standards are currently being reviewed in N.B. and N

Most of the provincial government/utility, stakeholder, and retailer key informants agreed that provincial/utility promotional programs and minimum energy performance standards have contributed to increasing the energy efficiency of equipment. They indicated that the promotional programs have increased the sale of energy-efficient products in provinces and helped saturate the market so that NRCan can continue to increase minimum energy performance standards. One respondent noted that provincial minimum energy performance standards encourage the federal government to keep pace and continue to increase the federal minimum energy performance standards.

A few stakeholder and retailer key informants indicated that provincial involvement in energy efficiency is counterproductive. They noted that having different minimum energy performance standards across provinces can create product shortages and consumer confusion. igher minimum energy performance standards for an energy-using product in one province can make it difficult for consumers in that province to access the product because manufacturers are responding to the demand from the rest of the country, and are therefore developing the less expensive and less energy-efficient models that are accepted in the other provinces.

Industry associations

While about half of the stakeholder key informants agreed that industry associations have helped increase the energy efficiency of equipment in Canada by supporting the federal government initiatives, a few other stakeholders and a few retailer key informants noted that industry associations' contribution is minimal because there is limited industry representation in Canada.

Evaluation question 6: Have the voluntary programs increased the behaviour of suppliers to supply higher energy-efficient products?

  • Yes, largely through voluntary programs that increase consumer demand.

Most of the NRCan, provincial government/utility, and stakeholder key informants agreed that providing information on energy-efficient equipment to suppliers will change their behaviour because suppliers want to have the extra edge over their competitors, such as being ENERGY STAR-certified. Some of the NRCan key informants also indicated, however, that suppliers react mostly to consumer demand. They stated that if the demand for ENERGY STAR products increases, then suppliers will supply the more energy-efficient products.

The brand equity of equipment created by the labelling activities reflects consumer demand for energy-efficient products. As noted by some of the NRCan key informants, if the consumers demand energy-efficient products, suppliers will supply them. The programming activities undertaken by NRCan and the provincial utilities have helped increase this demand for energy-efficient products. In turn, this stimulates product innovation and increased supply of energy-efficient equipment.

The ENERGY STAR and EnerGuide labels have become good branding tools for manufacturers. Having a high EnerGuide rating and/or the ENERGY STAR label on their product provides manufacturers with a competitive advantage over their competitors who do not manufacture ENERGY STAR-quality energy-efficient products.

For the most part, manufacturers are shipping and retailers are selling ENERGY STAR-qualified products at a higher rate than they did five years ago. While the level of ENERGY STAR refrigerators sold in 2006 and 2007 was low, the percentage of ENERGY STAR refrigerators being sold now is on the rise.

Some evidence of changes in behaviour by Canadian suppliers to supply higher energy-efficient products was available. For example, as of March 31, 2007, manufacturers representing 85% of the energy-using products in the market participated in the EnerGuide rating program and published the EnerGuide ratings in their brochures.103 Also, for the past five years, NRCan has conducted an annual survey of ENERGY STAR participants. Some of the key findings concerning changes in behaviour included:

  • The percentage of ENERGY STAR-qualified appliance shipments by manufacturers increased between 2003 and 2008 for residential clothes washers (~20% to ~55%); refrigerators (~45% to ~65%); freezers (~0% to ~50%); and dishwashers (~60% to ~90%). Although the percentages of ENERGY STAR-qualified products shipped for the appliances mentioned above were higher in 2008 than 2003, 2008 was not necessarily their peak. For example, both residential clothes washers and dishwashers peaked in 2006 at approximately 100%. Refrigerators and freezers both peaked in 2008.
  • The percentage of ENERGY STAR-qualified bottled water coolers shipped by manufacturers increased from approximately 20% in 2005 to over 80% in 2007. Dehumidifiers increased from approximately 10% in 2006 to about 80% in 2008.
  • The percentage of ENERGY STAR-qualified appliance sales by retailers increased between 2003 and 2008 for residential clothes washers (~35% to ~70%); freezers (~5% to ~40%); and dishwashers (~50% to ~90%). The sale of ENERGY STAR-qualified refrigerators decreased between 2003 and 2008 from about 75% to about 57%, with a low of approximately 10% in 2006 and 2007.
  • The percentage of ENERGY STAR-qualified gas furnace and boiler shipments by manufacturers increased between 2003 and 2008 from about 60% to about 75% and about 25% to 100%, respectively.104

Evaluation question 7: To what extent were standards successful in transforming equipment markets such that more energy-efficient equipment was introduced faster than would have been likely without the standards?

  • Improvements in energy efficiency in equipment would have happened much more slowly in the absence of standards.

Evidence of the effectiveness of minimum energy performance standards in improving energy efficiency in Canada comes from a recently released NRCan report looking at the impact of energy efficiency policies on energy savings associated with major appliances between 1990 and 2007. These savings estimates also include the impact of R&D expenditures by appliance manufacturers, the EnerGuide and ENERGY STAR programs, incentive and rebate programs offered by all levels of government, and increases in consumer awareness.105

Table 10: Savings for major household appliances due to energy efficiency policies in Canada (PJ)
Model year 2004 2005 2006 2007
Energy consumed without manufacturers improvements, minimum energy performance standards, and other policies 12.88 13.43 12.93 14.39
Energy consumed with manufacturers improvements, minimum energy performance standards, and other policies 8.25 7.83 7.32 7.83
Annual energy savings 4.63 5.6 5.61 6.56
Cumulative energy savings since 1990 (with retirement factor) 25.16 30.48 35.67 41.69
Source: NRCan (2009l, p. 44)
Note: Major household appliances include refrigerators, freezers, dishwashers, electric ranges, clothes washers, and electric clothes dryers.

According to this report, the combined effect of the above-mentioned factors in 2007 was to reduce energy consumption in major appliances by nearly half of what it would otherwise have been, from 14.39 PJ to 7.83 PJ, thereby generating annual savings of 6.56 PJ. The report estimates that since 1992, the factors described above have generated total energy savings of 41.69 PJ (11.56 billion kWh), "equivalent to one year's energy [use] for 58,900 households".106

It is not obvious that regulations in the U.S. or other countries would have driven increasing energy efficiency in Canada. In the absence of federal standards, Canada might have attracted manufacturers producing inefficient appliances and equipment that could not be sold in other jurisdictions, as occurred in the U.K. in the 1990s.107

Most of the key informants across all four groups noted, however, that U.S. minimum energy performance standards have contributed to increasing the energy efficiency of equipment in Canada. Many respondents noted that Canadian and U.S. minimum energy performance standards are aligned. While some of the standards are different between the two countries because of differing climates, respondents noted that minimum energy performance standards between the two countries are aligned because most of the manufacturing companies are located in the U.S., and the U.S. has much higher buying power than Canada.

Had standards not been developed at a federal level, they may have emerged at the provincial/territorial level (standards already exist in several provinces). However, many of the current provincial/territorial programs build off of the federal program, so it is not clear that the provinces/territories would have developed programs in the absence of the federal program.

A study by Nadel (2002) provides evidence suggesting that improvements in energy efficiency in appliances and equipment might have happened much more slowly in the absence of standards. Looking at energy intensity data from appliances in the U.S. between 1972 and 2001, he finds that the most rapid improvements in energy performance corresponded with the implementation of new standards, with very little improvement at other times.108

Other factors influencing increases in energy efficiency of equipment

Electricity prices

Increasing consumer demand for energy-efficient products in response to rising electricity prices may have contributed to improving efficiency in equipment and appliances even in the absence of policy intervention. That said, because of the low price of electricity in Canada, , such a demand response might never have emerged.

Evaluation question 8: To what extent have the programs reduced GHG and air pollution?

  • While the evidence indicates that this has been significant, much of the evidence is from estimates of future GHG reductions.

Description of GHG emissions generated from equipment

Inefficient equipment and appliances contribute to climate change by consuming relatively more energy than efficient appliances. Since a portion of this electricity is generated through the use of fossil fuels, inefficient equipment and appliances indirectly contribute to GHG emissions from the residential and commercial/institutional sectors.111

A case study proponent indicated that in jurisdictions where electricity is generated from non-emitting sources such as hydro dams, savings from energy-efficient equipment results in global GHG reductions. While the energy saved from a hydro plant does not reduce GHG emissions directly, the additional energy saved by the jurisdiction can be exported to other jurisdictions that may use fossil fuels to generate their electricity, therefore reducing their electricity generated from fossil fuels and reducing their total GHG emissions. For example, when Manitoba Hydro has additional electricity, it is exported to other jurisdictions, many of which are in the U.S. While some of those jurisdictions may use a clean electricity generating source, others may not. In the jurisdictions burning fossil fuels to generate electricity, the exported electricity from Manitoba Hydro is reducing GHG emissions.

GHG emissions reductions estimates

Currently, in Canada, 42 products fall under the Energy Efficiency Regulations. The current Energy Efficiency Regulations, including current and future amendments, are expected to result in the following energy savings and GHG emissions reductions:

  • The expected energy savings achieved by the Energy Efficiency Regulations and its amendments (Amendments 1 to 10) in 2010 is 178.15 PJ and by 2020 is 240.86 PJ. These energy savings are expected to result in GHG emissions reductions of 25.60 Mt by 2010 and 34.29 Mt by 2020.112
  • Under the Clean Air Regulatory Agenda, three amendments (Amendments 10 to 12) to the Energy Efficiency Regulations are expected to result in energy savings of 13.37 to 14.85 PJ/year and GHG emissions reductions of 1.4 to 1.5 Mt/year in 2010-11 (note that the energy savings and GHG emissions reductions estimated in this bullet and the previous bullet have some overlap; Amendment 10 contributes to both estimates).

While several forecasts of GHG emissions reductions are generated by NRCan, not many estimates of GHG emissions reductions are based on historical data for comparison. For example, NRCan forecasts the expected GHG reductions from a specific program, such as the Accelerated Standards Action Program. If NRCan attempted to estimate GHG reductions based on historical data, it would provide more accurate figures of estimated GHG emissions reductions and allow them to verify the accuracy of their estimates.

It should also be noted that while it is a requirement for project proponents that receive funding from the Equipment Division's grants and contributions program to develop a final report that provides estimated GHG emissions reductions based on the success of the project, NRCan does not use these estimates to try and calculate the success of a whole program following its completion.

For comparison and accuracy, one option is to develop an estimate of GHG emissions reductions based on the actual uptake of a voluntary program. The estimates based on historical data would provide a more accurate measurement of GHG emissions reductions and determine the accuracy of the forecasts. It may be beneficial to implement this process across the Program.

In 2009, NRCan conducted an analysis of the forecasted energy savings and GHG reductions estimates from the Regulatory Impact Analysis Statements for two products under Amendment 6 and Amendment 8. To verify the accuracy of forecasts in the Regulatory Impact Analysis Statements, the review compared the estimated energy savings and GHG reductions from the Regulatory Impact Analysis Statements to historical product shipment data collected since amendments to the Energy Efficiency Regulations were introduced. Table 11 and Table 12 present the results from the analysis for energy savings and GHG reductions, respectively.

Table 11: Analysis – forecasts vs. historical data – energy savings (PJ)
Amend-ment Product   Year
2003 2004 2005 2006 2007
6 Room window air conditioners RIAS reported estimate 0.0166 0.0327 0.0485 0.0643 0.0804
Revised estimate 0.0323 0.0688 0.1175 0.1996 0.2883
Difference 0.0158 0.0362 0.0689 0.1352 0.2079
8 Clothes washers RIAS reported estimate - 0.0518 0.1058 0.1621 1.3929
Revised estimate - 0.0526 0.1087 0.1635 1.4482
Difference - 0.0008 0.0029 0.0014 0.0553
Note: Due to rounding, there may be discrepancies in the calculated differences.
Note: Amendment 8 was not in effect in 2003.
Source: NRCan, 2009m.
Table 12: Analysis – forecasts vs. historical data – GHG reductions (Mt)
Amend-ment Product   Year
2003 2004 2005 2006 2007
6 Room window air conditioners RIAS reported estimate 0.0025 0.0049 0.0073 0.0097 0.0121
Revised estimate 0.0049 0.0104 0.0177 0.0300 0.0434
Difference 0.0024 0.0054 0.0104 0.0204 0.0313
8 Clothes washers RIAS reported estimate - 0.0051 0.0105 0.0161 0.1383
Revised estimate - 0.0052 0.0108 0.0162 0.1438
Difference - 0.0001 0.0003 0.0001 0.0055
Note: Due to rounding, there may be discrepancies in the calculated differences.
Note: Amendment 8 was not in effect in 2003.
Source: NRCan, 2009m.

The results from the analysis indicate that the forecasted estimates in the Regulatory Impact Analysis Statements underestimate the energy savings and GHG reductions expected from the implementation of an amendment to the Energy Efficiency Regulations. For example, the standard introduced for room window air conditioners in Amendment 6 to the Energy Efficiency Regulations was expected to result in energy savings of about 0.08 PJ in 2007, but the analysis indicated it actually resulted in energy savings of about 0.29 PJ; a difference of about 0.21 PJ. Since GHG reductions are associated with energy savings, an actual reduction of about 0.04 Mt was the result instead of the estimated 0.01 Mt; a difference of about 0.03 Mt. This illustrates that the Equipment Program may be conservative when estimating the reductions.

Evaluation question 9: Have there been unintended (positive or negative) outcomes? Were any actions taken because of these?

  • Yes; however, the unintended outcomes mentioned by key informants were negative.

Most of the key informants across all four groups mentioned the following unintended outcomes of the Equipment Program and indicated actions either taken by NRCan or suggested actions to be taken by NRCan:

  • The rebound effect may be affecting the impact of equipment energy efficiency programs. The concern is that people may be becoming less vigilant when using efficient equipment.
  • There has been some concern from consumers about change. For example, the possibility of setting minimum energy performance standards to eliminate incandescent light bulbs from the market has people worried that they will be forced to change to compact fluorescent light bulbs even though they do not want to.
  • There has been confusion from consumers between the EnerGuide and ENERGY STAR labels, which indicates a need for more promotion from NRCan for both labels.

Evaluation question 10: How economic are the programs (dollars per tonne of GHG emissions saved)?

  • The activities of the Equipment Program are economic at reducing GHG emissions.

All of the NRCan key informants indicated that NRCan's equipment standards and labelling programs are economic in their use of resources to reduce equipment-related GHG emissions. About half of the NRCan respondents specifically pointed out that the programs' cost per tonne of GHG emissions is one of the lowest among the federal programs in Canada aimed at reducing GHG emissions.

Cost per tonne of GHG emissions reduced was calculated for two Equipment programs based on forecasted GHG emissions reductions and costs of the programs. The calculations could not be conducted for all of the programs because they either did not complete their full term (Enhanced Equipment Market Transformation), did not provide expected GHG emissions reductions estimates (Climate Change Interim Strategy), or are still ongoing (Energy Efficiency Standards and Labelling Program).

  • The Accelerated Standards Action Program was expected to reduce GHG emissions by 2.8 Mt/year in 2010. In total, $28.4 million was spent under the Accelerated Standards Action Program. Therefore, if the Accelerated Standards Action Program achieved its GHG emissions reductions estimate, it will result in $10.14 per tonne of GHG emissions reduced in 2010, with reductions ongoing past 2010.
  • EnerGuide for Industry was expected to reduce GHG emissions by 1.4 Mt/year in 2010. In total, $2 million was spent under EnerGuide for Industry. Therefore, if EnerGuide for Industry achieved its GHG emissions reductions estimate, it will result in $1.43 per tonne of GHG emissions reduced in 2010, with reductions ongoing past 2010.

While the above calculations provide forecasted GHG reductions per dollar spent from some of the programs administered by the Equipment Division, there is no base to measure how economic the programs were in comparison to other federal programs or programs in other countries.

In comparison, Gillingham, Newell, and Palmer noted that, in 2000 alone, standards saved the U.S. 352 billion kWh and reduced GHG emissions by 17.8 Mt.113 Incorporating the cost of administration ($2.51 billion), they estimate that the standards cost approximately $0.0071 per kWh saved, or $141/tonne of GHG emissions reduced.

Comparison to other jurisdictions

Compared to other Organisation for Economic Co-operation and Development countries, many of the NRCan, provincial government/utility, and stakeholder key informants noted that Canada's energy efficiency equipment activities are similar. While some jurisdictions have different levels of stringency compared to Canada for some products, all of the jurisdictions employ similar minimum energy performance standards and labelling and promotional activities. Interviewees noted that, for example, California has more stringent standards than Canada, but it has higher standards out of necessity due to a lack of energy generation capacity in the area. Cultural attitudes towards energy use and environmental protection, climate and geography, and shares of renewable electricity generation all affect the stringency of energy-efficient equipment programs in other jurisdictions

Evaluation question 11: Do the programs produce significant changes in equipment energy efficiency and use to justify the costs of the programs?

  • Yes, the equipment activities undertaken by NRCan align with those commonly applied in other jurisdictions, and compare favourably to other energy efficiency programs in terms of cost-effectiveness.

All of the NRCan key informants agreed that NRCan's equipment standards and labelling programs produce a sufficient reduction in GHG emissions to justify the cost of the Program. NRCan key informants noted that increasing the energy efficiency of equipment through minimum energy performance standards and labelling is believed to be one of the cheapest forms of reducing GHG emissions. Similarly, from the literature, Harrington and Waide claim that "energy efficiency labelling and minimum efficiency performance standards . are among the most cost-effective and widely used measures employed to reduce [GHG] emissions".114

As noted above, the literature shows that comparable energy efficiency programs in other countries are generally believed to produce significant changes in equipment energy efficiency and use at low cost. Canada undertakes similar equipment energy efficiency activities as other jurisdictions.

Evaluation question 12: What internal and external factors influence/confound the effectiveness, efficiency, and economy of the Program?

  • Three main factors appear in the literature.

The price of electricity is an important confounding variable. A recent Organisation for Economic Co-operation and Development study suggests that consensus estimates of the price elasticity of demand are about -0.3 for the short run, and around -0.7 for the long run.115 This means that a 10% increase in the price of electricity will decrease the quantity of electricity demanded by 3% in the short run and 7% in the long run. The implication is that consumers are unlikely to immediately respond to higher electricity prices by drastically using less electricity. Ultimately, however, households and businesses will adjust to the higher prices by conserving electricity or purchasing more efficient appliances. The lesson for policy is that sustained high electricity prices may be sufficient in themselves to encourage consumers to purchase more energy-efficient appliances and equipment, although this process may not occur as quickly as desired from a policy perspective. It also means that to assess the effects of government programs relating to appliances and equipment, it is necessary to control for significant changes in the price of energy.

Another important confounding phenomenon is the rebound effect, which (in this context) refers to the tendency for consumers purchasing energy-efficient appliances and equipment to use them more intensively or to increase their use of other energy-consuming products. In the extreme, it is theoretically possible for energy efficiency improvements to cause increases in overall energy use. Table 13 outlines estimates of the direct rebound effect for various products used by consumers and firms.

Table 13: Summary of evidence for the direct rebound effect
Economic agent End use Potential size of rebound effect
Consumers Space heating 10-30%
Space cooling 0-50%
Water heating <10-40%
Residential lighting 5-12%
Appliances 0%
Firms Process uses (short run) 0-20%
Lighting (short run) 0-2%
Source: Greening et al. (2000, p. 398)

As Table 13 illustrates, the rebound effect in equipment and appliances is small or moderate, and is certainly unlikely to increase overall energy use; however, it does appear to erode substantial proportions of energy savings associated with improved energy efficiency.

From a policy perspective, unless decision-makers account for the rebound effect, they may overestimate the actual contribution of the Equipment Sub-Sub Activity to GHG reductions. These findings also highlight the importance of influencing consumer behaviour around energy use, in addition to improving energy efficiency in equipment and appliances.

A third factor influencing the effectiveness of programming offered by the Equipment Sub-Sub Activity is other programming. In addition to NRCan, other federal departments, as well as provincial and territorial governments, municipalities, utilities, and non-profit organizations, administer programs potentially influencing energy consumption and GHG emissions from equipment and appliances. For example, programs improving building insulation reduce the amount of energy required to heat or cool the interior to a particular temperature. Similarly, education and awareness campaigns may promote more efficient use of energy-efficient appliances, further reducing the environmental impacts associated with their use.116 The combination of Equipment Division and other programming can increase overall energy savings; however, it may decrease the expected impact of the Equipment programming.

Similarly, most of the key informants across all four groups noted that programming in other jurisdictions can influence the energy efficiency of equipment in Canada. While all jurisdictions can have an effect, in Canada, the U.S. has the biggest effect. For example, Canada aligns its minimum energy performance standards and ENERGY STAR standards with those of the U.S. to the greatest extent possible. This alignment with the U.S. has had mostly a positive influence on the effectiveness, efficiency, and economy of the Equipment Division's minimum energy performance standards.

Evaluation question 13: What changes would improve program delivery and impact? Have the already implemented changes improved program delivery and impact?

  • Key informants provided several suggestions to improve program delivery and impact.

All of the key informants provided the following suggestions to improve the design or implementation of NRCan's equipment standards and labelling programs:

  • Increase the speed of response of the Equipment Division to market changes. It is an ongoing challenge to keep the Equipment program current and relevant.
  • Continue to increase the stringency of minimum energy performance standards while keeping in mind the economics to the consumer. Continuing to increase the stringency of some products may not be effective and new products or methods may be needed to continue to reduce GHG emissions.
  • Provide more up-to-date equipment information online in an easy-to-use, searchable system.
  • Increase the use of local actors, such as utilities, provincial governments, and municipalities to influence consumer behaviour. These groups are more familiar with their jurisdictions and know how to deliver programs more effectively.
  • More coordination/communication between NRCan and the provinces, utilities, industry associations, retailers, etc. concerning programming.
  • Work and provide more programming directed at manufacturers to increase their interest in developing energy-efficient products.
  • Make it less costly, more timely, and easier to have products ENERGY STAR-certified. For some products, such as light bulbs and windows, it is not worth the cost to get them ENERGY STAR-certified, even though they meet the qualifications.
  • Increase the level of compliance for products meeting minimum energy performance standards and ENERGY STAR standards. It was indicated that the Equipment Division should have a clear, demonstrable policing process to respond to manufacturers' claims to energy efficiency and include a mechanism that randomly checks the energy efficiency of products.
  • Ban the sale of used appliances.
  • Increase consumer education and awareness and reduce federal incentives.
  • Have more third party involvement to reduce the administrative burden on NRCan, similar to the work done with the Canadian Standards Association.
  • Increase the publicity of the Energy Efficiency Recognition Program for retailers to push other retailers to become more involved.

A few stakeholder and provincial government/utility key informants noted that increasing the focus of energy efficiency on industrial equipment would help the Equipment Division increase their reduction of equipment-related GHG emissions. The key informants said that most of the Equipment Division's focus has been in the housing and commercial sectors and that there are several pieces of equipment in the industrial sector that remain unregulated. In 2007, the industrial sector had the lowest energy savings in comparison to the residential and commercial sectors.

Implemented changes improved program delivery and impact

Changes to NRCan's compliance activities have improved program delivery and impact. The Equipment Division has continued to improve its overall monitoring capability, including import monitoring capability, to ensure compliance by dealers and to provide manufacturers, dealers, national energy efficiency incenting programs, and all Canadians with credible third party-certified lists of compliant products by undertaking a number of tasks, including:

  • Shifting from paper to electronic reporting of import information - In 1999, the Equipment Division implemented its electronic reporting process with the Canada Border Services Agency. In 2007, the Canada Border Services Agency informed the importing and brokerage community that it was moving to a paperless environment, almost exclusively to electronic import reporting for all regulated and non-regulated products. The push in 2007 by the Canada Border Services Agency was seamless for the Equipment Division because it had already been receiving electronic import information for over 10 years.
  • Standardizing energy efficiency reporting forms for dealers by creating electronic templates to avoid differing dealer-produced reports and paper submittals by fax or mail. The Equipment Division provides the templates to the dealers to reduce the burden on them.
  • Partnering with certification organizations to receive collaborative data dumps of energy efficiency reports from dealers/manufacturers that authorized the certification organization to submit on their behalf. Also, the Equipment Division accepts individual energy efficiency reports from certification bodies submitting on behalf of dealers/manufacturers.
  • Making better use of existing forms, such as the Energy Efficiency Report, to avoid having to contact dealers more than once to get additional information. For example, ENERGY STAR information was added as a voluntary field to the mandatory Energy Efficiency Report form. This created a one-stop ENERGY STAR and regulatory reporting for dealers/manufacturers submitting information on regulatory products that were also ENERGY STAR-qualified.
  • Hiring more compliance staff - With the constant addition of more regulated products through regulatory amendments, the Equipment Division hired more compliance staff to:
    • provide advice about regulatory requirements and provide guidance to dealers of regulated products and manufacturers;
    • follow-up on inquiries, reports regarding missing models, brands, etc.;
    • create web-based searchable lists of models for new products; and
    • provide compliance support activities to the Equipment Division.

These activities have provided the Equipment Division with the ability to handle the large increases in electronic customs submissions and model submittals, which have increased considerably over the past five to 10 years. The compliance activities have also resulted in the following:

  • Shifting from paper to electronic reporting:
    • decreases in the number of paper copies submitted to the Canada Border Services Agency and in corresponding costs for an external contractor to digitize the data for the monitoring process;
    • a doubling in the number of import line item records captured when the paper option was essentially discontinued;
    • contributions to the government's initiative to reduce paper under the Paper Burden Reduction Initiative; and
    • decreases in the amount of time for compliant products to be posted to the website (within two weeks).
  • Standardized reporting forms and collaborative data dumps:
    • increases in the accuracy and completeness of the mandatory and voluntary performance information being submitted.
  • One-stop ENERGY STAR and regulatory reporting:
    • decreases in administrative burden for dealers;
    • the elimination of duplication (e.g., don't have to request information from dealers multiple times);
    • increases in dealer/manufacturer satisfaction; and
    • increases in the accuracy and completeness of information being submitted.

4.0 Conclusions

The Equipment Sub-Sub Activity implements standards and voluntary promotional and labelling programs in an effort to increase the minimum energy efficiency of equipment manufactured and supplied by suppliers and therefore purchased by consumers. Increasing the energy efficiency of equipment leads to reductions in energy use and associated GHG emissions. The current program administered by the Equipment Division-the Energy Efficiency Standards and Labelling Program-is expected to reduce annual GHG emissions by between 5.2 and 5.8 Mt/year in 2020.

4.1 Relevance

The Equipment Sub-Sub Activity aligns closely with the federal government's priorities and NRCan's mandate and objectives. By contributing to the reduction of GHG emissions in Canada, the Equipment Sub-Sub Activity supports the federal government's commitment to reduce GHG emissions by 17% by 2020, relative to 2005 levels. In addition, NRCan's mandate is "to enhance the responsible development and use of Canada's natural resources and the competitiveness of Canada's natural resources products".118 The Equipment Division supports this mandate by reducing energy use and therefore reducing reliance on fossil fuels, the largest source of GHGs.

The Equipment Sub-Sub Activity plays an important leadership role for the provincial governments and utilities. The federal minimum energy performance standards and labelling programs provide an energy efficiency standard that provinces use as a reference for their own standards and energy efficiency programming. The centralization of standards setting, labelling, and enforcement is a major cost saving that also creates a national framework for energy policy.

As an example, the federal labelling programs have been widely used by the provincial utilities in their demand management programs. The utilities have taken advantage of the ENERGY STAR label to model their incentive programs, alleviating them of the need to develop and maintain separate standards.

Another important leadership aspect within the federal government is the coordination it maintains with provinces and international partners, such as the U.S. It ensures a strong bond with these partners and proper compliance and information dissemination in Canada.

4.2 Performance

The literature indicated that the NRCan minimum energy performance standards and labelling activities are expected to result in decreases in GHG emissions. All of the key informants across all four groups agreed that these activities were effective in saving energy and reducing GHG emissions. While energy use has continued to increase in the residential, commercial, and industrial sectors, the evaluation concludes that energy use would be much higher without the increases in energy efficiency of energy-using products. The Equipment Sub-Sub Activity is continuing to introduce and increase the stringency of minimum energy performance standards and ENERGY STAR standards and therefore continuing to decrease GHG emissions.

Table 14 provides the estimated energy savings and GHG reductions from the programs administered by the Equipment Division and the amendments to the Energy Efficiency Regulations that were published during the evaluation period.

Table 14: Estimated Energy Savings and GHG Reductions from Equipment Programs and Regulations
  Energy Savings in 2010 (PJ/yr) GHG reductions in 2010 (Mt/yr) Energy savings in 2020 (PJ/yr) GHG reductions in 2020 (Mt/yr)
Programs*
Accelerated Standards Program 37.19 2.8 not avail. not avail.
EnerGuide for Industry 19.00 1.4 not avail. not avail.
Energy Efficiency Standards and Labelling Program 13.4 to 14.9 1.4 to 1.6 66.63 5.2 to 5.8
Regulations
Amendment 8 16.2 1.29 42.67 3.61
Amendment 9 1.64 0.16 7.17 0.55
Amendment 10 6.09 0.40 88.10 9.67
* The estimated energy savings and GHG reductions from the programs listed expand past the evaluation period. Energy saving and GHG reduction estimates were not provided for the Enhanced Equipment Market Transformation Program and the Climate Change Interim Strategy.
Note: not avail. = not available

Many of the GHG emissions reductions estimates are forecasts of future reductions in GHG emissions and do not reference historical energy use norms. Generating GHG emissions on more reliable historical reference points would provide a more accurate estimate of GHG emissions arising from implementing a new program or standard and provide a comparison for the accuracy of forecasted estimates.

The literature and many of the key informants across all four groups indicated that consumer behaviour is changing toward the purchase of more energy-efficient equipment in Canada. NRCan programming in support of provincial initiatives has, in large part, encouraged this market transformation. The provincial governments and utilities are undertaking several equipment energy efficiency activities that are either partly funded by NRCan or build on build on the ENERGY STAR label being used by NRCan programs.

The change in consumer preference induces retailers to demand more energy-efficient products from manufacturers. The ENERGY STAR and EnerGuide labels have also become effective branding tools for suppliers, and those who can meet and exceed the standard experienced increased brand equity that confers a competitive advantage. Adopting an ENERGY STAR program with levels of efficiency (e.g., gold, silver, and bronze) creates more product differentiation that may offer an increased incentive for manufacturing participation and support.

While there are several ways to reduce GHG emissions, minimum energy performance standards (e.g., through new and amended regulations) and labelling activities are cost-effective. Several key informants strongly supported the continuation and even expansion of the current Energy Efficiency Standards and Labelling Program. Most of the focus of the Equipment Division appears to be on residential and commercial energy-using products; however, a few key informants indicated that more focus on industrial equipment would be beneficial. While the EnerGuide for Industry Program focused on energy efficiency in the industrial sector, the Program ended in 2006 and the sector saw lower energy savings in 2007 compared to the residential and commercial sectors. This is substantiated in Table 6 (presented previously), which illustrates that while the industrial sector consumed the greatest amount of energy in 2007, it had the smallest impact resulting from energy improvements.

It is important for the Equipment Division to continue to consult with industry to introduce only feasible increases in energy efficiency standards as this ensures standards are not raised too quickly for the market to respond and that the opinions of industry are taken into consideration. A delicate balance exists between setting a standard that is an incentive and one that is so rigorous that only a few manufacturers can meet it. In that case, the standard could cause some manufacturers to withdraw, leading to less competition and higher prices—clearly a negative outcome for the consumer. NRCan's work with the Canadian Standards Association has been beneficial in determining appropriate levels for standards.119

5.0 Recommendations

The Equipment Program has been successful and is employing effective activities to reduce GHG emissions. Minor modifications are recommended in order to maintain the Program:

  1. As future program directions are examined, consideration should be given to examining programming gaps and opportunities identified in the evaluation, for example:
    • programming in other areas subject to the authority of the Energy Efficiency Act; and
    • influencing consumer energy use behaviour to reduce the rebound effect.
  2. NRCan should better track outcomes to confirm the value of the Program:
    • could be accomplished by measuring GHG reductions based on historical data from the implementation of minimum energy performance standards or labelling activities and comparing them to the forecasted estimates within the capacity to project and verify.
  3. NRCan should reduce the monitoring of ENERGY STAR awareness to biannual (instead of annually) and continue to conduct discrete choice analyses.
  4. NRCan should continue coordination with the provinces and the provincial utilities to further align federal and provincial programs to increase effectiveness (for example, by decreasing confusion among consumers and suppliers, which was noted as a potential issue).
  5. NRCan should continue consultations with relevant stakeholders (including industry) to introduce feasible increases in energy efficiency standards.

Annex 1: Summary Information on Equipment Case Studies

Project Name Description Objective Results NRCan Expenditures ($M)
Grants and Contributions

Lighting the Way

(Project Porchlight, One Change – Ottawa, Guelph, Thunder Bay, Whitehorse)

  • Implement a community based social marketing program and to promote the ENERGY STAR label
  • Hand out free efficient ENERGY STAR-qualified light bulbs and explain the benefits to Canadians through a door-to-door campaign or through community events
Increase the awareness of ENERGY STAR-qualified CFLs and their benefits

Evaluate the awareness and acceptability of ENERGY STAR-qualified CFLs

Make possible the development and growth of community networks and partnerships

Develop a robust program model that will allow similar projects to be implemented across the country

Transform behaviour and attitudes about energy efficiency and energy conservation.

The project's ultimate goal is to show people that simple actions matter and to encourage them to make smart choices to save energy
  • 246,900 CFLs were distributed in Ottawa, Guelph, Thunder Bay and the Yukon
  • Based on a follow-up poll, 70% of respondents confirmed that they had installed the CFLs they had been provided
  • 60% of the respondents that had not yet installed the bulbs indicated their intention to do so in the future
  • 57 community groups and organizations were involved in the delivery of the project
  • 366 volunteers participated in the Program
  • Average of 1,459 website visitors per month between November 2006 and March 2007

$85,000

(Nov. 2006 to Mar. 2007)

Good Life Campaign

(World Wildlife Fund, Canada)

  • Community engagement project intended to reduce greenhouse gas emissions by encouraging Canadians to make minor, but significant energy-saving lifestyle changes
  • Campaign launched with a website that provided a list of actions people could take to minimize their carbon footprint and to raise awareness of the ENERGY STAR label
  • The website provides a list of actions to which people can commit, calculates the impact of these actions in terms of GHG emissions reductions, and also includes social networking features, allowing people to create user profiles and to share their actions and commitments with others

Promote and raise awareness of the ENERGY STAR label

Two emerging trends in Canada were identified, namely: a) an increasing recognition among Canadians that climate change is an issue that demands collective action; and b) the increasing popularity of online social networking

The campaign sought to take advantage of these trends by creating a community of like-minded change-ready individuals, and showing them the tangible benefits of their individual and collective actions to combat climate change

  • Homepage engagement (total number of clicks on TGL Campaign homepage divided by total number of impressions generated) = 66.35%
  • Sign-up page conversion rate (easures the % of clicks from the sign-up/login page that subsequently become new sign-ups) = 19.14%
  • Estimated conversion rate from unique visitors = 23.57% (6,941 sign-ups from 29,447 visitors)
  • Action engagement (measures the number of actions committed to divided by the number of members) = 7.07/account
  • Return engagement (measures the number of return visitors over stated period divided by unique visitors) = 31.26%

$75,895

(Feb. 2008 to Mar. 2008)

High-Efficiency Heating Equipment Replacement Program

(Enbridge Gas Distribution (EGD) Inc., Ontario)

  • The project included two phases with the first one running from Oct. 2003 to Sept. 2004 and the second one running from Sept. 2005 to Mar. 2006
  • During the two phases, EGD and NRCan each provided a $100 incentive to eligible customers who purchased and installed ENERGY STAR qualified heating equipment
  • Heating equipment manufacturers offered an additional $150 rebate during Feb. and Mar. 2006
  • While this case study focused on the second phase of the project, the first phase was also discussed; both rebate programs were essentially the same

To increase EGD's market penetration up to 39%–40% in EGD's Ontario franchise area

To encourage more consumers to switch to high-efficiency heating systems, which would ultimately lead to gas savings and environmental benefits from reducing CO2, NOx, and SOx particulates that contribute to the creation of smog

  • First phase of the campaign reached 15,481 participants (72% more than anticipated), generated gas savings of 191,995,362 m3 over the life of the equipment, and resulted in 363,000 tonnes of reduced CO2 emissions
  • Second phase of the campaign reached 16,025 participants (23% more than anticipated), generated gas savings of 111,053,250 m3 over the life of the equipment, and resulted in 209,891 tonnes of reduced CO2 emissions
  • Note that the research for consumption savings of high-efficiency furnaces changed between 2004 and 2006 and that is why more participation in the second phase resulted in lower gas savings and emissions reductions.

Second phase: $1,349,660.58

(Sept. 2005 to Mar. 2006)

Energy Efficiency Standards Development

(Canadian Standards Association (CSA), Canada)

  • This case study pertains specifically to standards development activities undertaken by CSA in the area of energy efficiency during fiscal year 2006-07
  • The contribution agreements indicated 32 distinct tasks to be undertaken by CSA, including the creation and updating/revision of 28 energy efficiency standards
  • CSA does not establish energy efficiency standards; rather, its role is to provide a forum in which stakeholders can assemble; and to facilitate stakeholder participation in the standards development process
  • The standards developed by CSA are voluntary unless they are reference by a regulatory authority

The objective of the standards development process is to develop National Standards of Canada providing recommended test procedures and minimum efficiency levels that can be referenced in legislation

The standards development process would contribute to GHG reduction by decreasing the energy consumption of products sold in the market, and by accelerating the rate at which these more efficient products are introduced into the market

  • CSA generally succeeded in publishing new or revised standards within the timelines projected by NRCan
  • CSA has completed their work on (published) 27 of the 28 standards included in the contribution agreement; work on the last standard has been delayed, pending activity by the US Department of Energy

$684,541

(Apr. 2006 to Mar. 2007)

Soak Up the Savings Program

(Climate Change Central (C3), Alberta)

  • The Soak Up the Savings Program was designed to increase consumer awareness of ENERGY STAR qualified products and transform the market for ENERGY STAR qualified clothes washers
  • The Program provided a $50 incentive ($25 from NRCan and $25 from C3) to any Albertan who purchased an ENERGY STAR qualified clothes washer for non-commercial use
  • The activities of the Program included educating salespersons about ENERGY STAR, a promotion strategy, a rebate for the purchase of ENERGY STAR clothes washers, and follow-up surveys

To reduce the electrical load and water consumption of non-commercial clothes washers; and therefore, reduce GHG emissions

Stimulate and accelerate demand for ENERGY STAR qualified products and transform markets

Stimulate behavioural change at the individual consumer level and at the product retail level

Increase awareness of the ENERGY STAR Program and of Energy Solutions Alberta

Increase consumer awareness of water conservation issues

Create early acceptance and awareness of the benefits of ENERGY STAR qualified clothes washers, thus reducing resistance to the new standard

  • The sale of 13,800 ENERGY STAR clothes washers
  • A reduction of 7,385 tonnes of GHGs annually
  • Energy savings of 7,705 MWh annually
  • A reduction of 399,451,587 litres of water consumption annually
  • The Program did not achieve its estimated target of clothes washers sold of 21,832 clothes washers
  • 31% of retailers saw some increase in the sales of ENERGY STAR clothes washers and 23% saw a considerable increase
  • Public awareness of the advantages of ENERGY STAR-qualified appliances significantly increased during the Program, and interest in ENERGY STAR was still high after the Program ended
  • The free ridership rate for the Program was 43%, indicating that 43% of the applicants would have purchased a ENERGY STAR clothes washer without the rebate offer

$471,000

(Feb. 2005 to Mar. 2007)

2004 ENERGY STAR Advertising in Saskatchewan120

(SaskEnergy, Saskatchewan)

  • In September 2004, SaskEnergy implemented an energy efficiency advertising campaign and delivered it in partnership with NRCan
  • The advertising campaign was run concurrently with the ENERGY STAR Loan Event, which was a SaskEnergy and NRCan partnership to offer prime rate loans to customers who purchased ENERGY STAR qualified furnaces and boilers
  • The advertising campaign included TV and radio advertisements

To increase the uptake of the ENERGY STAR Loan Event

To increase awareness of the benefits of ENERGY STAR qualified furnaces and boilers in general

To create an awareness of the benefits of high efficiency furnaces and boilers beyond the loan program as a transition strategy to move away from incentives through education

  • Approximately 1,800 customers saved $1.8 million in energy and borrowing costs through SaskEnergy's various ENERGY STAR programs run in 2004–05, which resulted in estimated GHG reductions of 4,000 tonnes annually
  • The advertising campaign reached a total TV audience of 1,060,300 viewers in Regina, Saskatoon, Prince Albert, and Yorkton
  • The campaign reached a total radio audience of 1,256,750 listeners in Regina and Saskatoon
  • SaskEnergy in partnership with NRCan ran the same TV and radio ads in October 2005 as part of their ENERGY STAR Qualified Furnace with a Variable Speed Motor (VSM) promotion
  • Saskatchewan is the most aware of ENERGY STAR province in Canada

$119,081.10

(Sept. 2004 to Dec. 2004)

Smart Meter Pay As You Go Pilot121

(Manitoba Hydro, Manitoba)

  • The project involved the implementation of a small-scale pilot to test the impact of smart meter technology on energy use and customer satisfaction in Manitoba households
  • Smart meters promote household energy conservation by continuously reporting household energy use and expenditures
  • The proponent intended to assess impact by comparing outcomes of interest between an experimental group (consisting of households installing the meters) with an equal-sized control group

Measure the change in electricity usage in homes with the Pay As You Go (PAYGo) System between June 2005—June 2006 in five Manitoba groups (i.e., rural, urban low income, urban middle income, Northern, and First Nations)

Examine and report changes in consumer attitudes towards: monitoring and conserving energy; Manitoba hydro; and consumer perceptions of control

Assess overall satisfaction with the PAYGo System, and likelihood of continuing its use and recommending it to family and friends

To assess the feasibility of a full-scale smart-metering program

  • While energy usage in the experimental group decreased by 2% following installation of the smart meters, usage fell 4% in the control group
  • Relative to the control group, attitudes towards energy conservation by respondents in the experimental group improved significantly by the end of the study, although Acumen Research warns that "while this may be indicative of some impact of the smart meter[,] results cannot be considered conclusive"
  • Relative to the control group, respondents in the experimental group were significantly more likely to monitor their electricity use by the end of the study
  • Customer experiences with the smart meters were generally positive; more than half of respondents (56%) reported being "very satisfied" with the smart meter, while a further quarter of respondents (23%) reported being "quite satisfied"
  • Respondents generally expressed willingness to use the meters in the future, and to recommend them to family and friends.
  • As a consequence of the results of the PAYGo Pilot, Manitoba Hydro reported that they would not be considering further use of smart meter technology

$95,051.25

(Nov. 2004 to Mar. 2007)

High Efficiency Natural Gas Furnace Program

(Union Gas Ltd., Ontario)

  • Consumers were eligible for rebates of $150 for buying and installing ENERGY STAR natural gas furnaces, and an additional $150 ($300 total) for an ENERGY STAR furnace with a variable speed fan motor (ECMs)
  • The key elements of the Program included promotion to consumers, promotion to and training for contractors, and administration of incentives

To promote the sale and installation of ENERGY STAR natural gas furnaces and natural gas furnaces with an ECM

Strengthen relationship with existing customers and build credibility with them by encouraging energy wise behaviour

Support Union Gas's commitment to demand-side management by providing residential customers with opportunities for additional energy savings

Promote the sale and installation of 4,000 ENERGY STAR furnaces between September 15, 2004 and November 15, 2004

Educate consumers and contractors about the benefits of high-efficiency heating equipment with a focus on ENERGY STAR

Enhance the relationship between Union Gas and HVAC contractors

  • It was estimated that the Program influenced natural gas savings of 840,000 m3; equivalent to 1,554 tonnes of CO2
  • The Program influenced the installation of 6,393 ENERGY STAR qualified heating systems (Note: these figures do not take into account free ridership)
  • Union Gas saw a 43% uptake increase over a similar program ran by Union Gas in 2003 (Note: these figures do not take into account free ridership)
  • There were 2,432 hits on the furnace campaign webpage on the company's website over the duration of the 2004 program
  • Union Gas reported "qualitative contractor feedback" indicating a generally positive response to the information sessions and to the materials presented at the sessions

$510,826

(Jul. 2004 to Mar. 2005)

BC Energy Efficiency Market Transformation Program for Buildings and Equipment122

(BC Ministry of Energy, Mines & Petroleum Resources, British Columbia)

  • Involved the implementation of nine initiatives aimed at improving the energy performance of new and existing buildings in British Columbia by 2010
  • Over half of NRCan funding supported two of the nine initiatives, namely Window, Door, and Skylight Market Transformation, and Heating System Market Transformation
  • The Program employed a market transformation approach, combining information/education, voluntary measures, pricing and incentives, and regulatory measures in a sequential fashion to improve energy efficiency in buildings and equipment
  • The Program involved the implementation of nine initiatives
  • Although NRCan contributed $11M to this project, it only represented 11% of the total budget
To permanently improve the energy performance of new and existing buildings in British Columbia by 2010, by achieving reductions in energy intensity in new and existing single family and row house residential buildings, multi-unit residential buildings, and industrial, commercial, and institutional buildings
  • All nine initiatives resulted in energy savings of 1,328,913 MWh and estimated CO2 emissions reductions of 590,142 tonnes

$11,000,000

(Apr. 2005 to Mar. 2007)

General Case Studies

Compliance Monitoring Activities / Equipment Database

(NRCan, Canada)

  • NRCan is responsible for the administration of Canada's Energy Efficiency Act and Regulations, which prohibit the importation into Canada or shipment between provinces, of energy-using equipment that is imported or shipped for the purpose of sale or lease in Canada
  • Activities include the monitoring of energy efficiency reports submitted to NRCan and the monitoring of importations which are carried out by the Canada Border Services Agency
  • All energy efficiency report and importation information is entered into the Equipment database
  • The Equipment database has two major components: the energy efficiency report section and the import section
  • Compliance with energy efficiency standards can be determined in both components of the Equipment database
  • Import information can be submitted on paper or electronically
  • Some of the specific activities undertaken by the Equipment Division to improve the overall compliance of energy-using products imported included: shifting from paper to electronic reporting of import information; standardizing energy efficiency reporting forms for dealers by creating electronic templates; partnering with certification organizations to receive collaborative data dumps of energy efficiency reports from their members; and making better use of existing forms to create a one-stop ENERGY STAR and regulatory reporting form

To monitor regulated products that are imported or shipped between provinces to ensure that they meet Canada's energy efficiency standards

To collect information on importers to ensure that we have contact information on these dealers in order to communicate NRCan requirements

To improve the level of compliance by dealers involved in regulated energy-using products

To improve monitoring capabilities to make them more effective and efficient (e.g. using electronic transmission; "piggy-backing" on the Canada Border Services Agency operations; targeted mail-outs, etc)

  • Shifting from paper to electronic reporting resulted in: decreases in the number of paper copies submitted to the Canada Border Services Agency and in corresponding costs for an external contractor to digitize the data for the monitoring process; a doubling in the number of import line item records captured when the paper option was essentially discontinued; contributions to the Government's initiative to reduce paper under the Paper Burden Reduction Initiative; and decreases in the amount of time for compliant products to be posted to the website (within two weeks).
  • Standardized reporting forms and collaborative data dumps resulted in: increases in the accuracy and completeness of the mandatory and voluntary performance information being submitted;
  • One-stop ENERGY STAR and regulatory reporting resulted in: reductions of administrative burden for dealers; the elimination of duplication –don't have to request information from dealers multiple times; increases in dealer/manufacturer satisfaction; and increases in the accuracy and completeness of information being submitted
N/A

LED Traffic Lights – LED Traffic Signal Retrofit Pilot Project & Canadian overview

(Manitoba Hydro, Winnipeg, Manitoba)

  • The first phase of the Manitoba Hydro project involved gathering background information on LED traffic signals and replacing incandescent traffic signals with LEDs at 15 intersections in Winnipeg
  • The second phase of the project was to measure the medium-term performance of the LED traffic signals through ongoing data collection over the first three years following installation
  • A 2006 study by Marbek Consultants provided an overview of LED traffic light use across Canada.

Gather data on the impact of climatic extremes (i.e., heat, cold, and humidity) on LED traffic signal performance (energy use, display module life, light output, and visibility)

Gather data on the impact of high density and high-speed traffic vibrations on display module life and maintenance and cleaning requirements

Measure/monitor optical degradation from fading and dirt

Estimate life expectancy to failure and to fade out

Evaluate optical performance of LED traffic and pedestrian signal lights and compare their performance to conventional technologies

Compare field performance of LED lights to lab reports and manufacturers' claims

Evaluate compatibility of LED traffic and pedestrian signals with electro-mechanical and computerized traffic signal controllers

Compare the resources needed to operate and maintain conventional traffic and pedestrian signals with their LED counterparts, by light colour, use, and operating schedule

Gather information regarding the performance, costs, benefits, and problems encountered from research reports and other jurisdictions that have adopted LED traffic signal technology

Determine LED traffic light use across Canada

  • Cleaning the LED traffic signals 14 months after installation resulted in an average light intensity increase of about 4% in low-speed, light or heavy density traffic areas; and about 13% in high-speed, heavy density traffic areas
  • Cleaning the LED traffic signals after another 16 months resulted in an average light intensity increase of about 7% in low-speed, light or heavy density traffic areas; and about 17% in high-speed, heavy density traffic areas
  • LED light intensity measurements were also taken, but the amount of time between measurements provided data that was too limited to form conclusions concerning their long-term depreciation
  • In the higher ambient light conditions, snow on LED traffic indicators following a snow storm significantly impairs the ability of drivers to discern which indicator is illuminated
  • LED indicators are less of a problem than conventional incandescent traffic signal indicators when sunlight is shining directly into them
  • In 2005, 93% of new traffic and pedestrian signal light installations in Canada were LED
  • The higher capital cost of LED traffic signals is a barrier to provinces and territories converting to LEDs
  • Over 95% of survey respondents that had used LEDs indicated that LEDs had met or exceeded their expectations in annual energy savings, cost savings, reduced maintenance costs, as well as health, safety, and environmental benefits
  • The percentage reduction of power draw of LED signals compared to conventional signals ranged between 85%–96%

$128,175

(Early 2004 to Mar. 2007)

Annex 2: Overview of Programs

Accelerated Standards Action Program

The Accelerated Standards Action Program (ASAP) was a five-year, $30-million program that ran from April 1, 2001 to March 31, 2006. The Program employed a mix of policy instruments, incentives, enhanced information, and promotion tools, and the setting of more stringent regulations to increase the efficiency of energy-using products in all Canadian sectors and to reduce GHG emissions. The ASAP had the following objective:

To accelerate the penetration of existing high efficiency products into the appliances and equipment stock by initially deploying a series of "market based" initiatives that will encourage consumers to purchase "best-in-class" efficient products and thereby set the stage for more stringent minimum standards in the future.123

To meet this objective, the ASAP was divided into the following six main activities:

  • The introduction and promotion of endorsement programs, such as coordinated platforms, messages, and placements in major consumer media, to consumers to make it easier for them to identify highly-efficient products.
  • The piloting of financial incentives targeted at various levels in the product distribution channel. Different levels include consumers, retailers, etc.
  • The introduction of outreach programs targeted at households to encourage early retirement of existing appliances.
  • The promotion of the use of high-efficiency specifications in existing and newly-launched procurement programs directed at institutional equipment purchasers. The focus was on partner recruitment, specification writing, and the development and dissemination of educational materials.
  • The introduction of a process improvement exercise for standards to help transform equipment markets so that new and more stringent standards can be more quickly put in place. In parallel, an assessment of this fifth initiative was conducted to address business impacts of standards, target standards levels, and incorporate collateral benefits.
  • The development of updated energy performance test standards for regulated products and newly regulated products.124

One of the main goals and achievements of the Program was the introduction of the ENERGY STAR endorsement program into the Canadian market. The ASAP was successful at introducing the label in Canada in 2001.

The above-listed activities and the introduction of the ENERGY STAR label were expected to result in the outcomes listed in Table 1 (see Appendix B for the Accelerated Standards Action Program's full logic model).

Table 1: Intended outcomes of the Accelerated Standards Action Program
Intermediate outcomes Long-term outcomes
Increased awareness of ENERGY STAR Program and its benefits

Growing market for high-efficiency appliances and equipment

Improvement in average energy efficiency of stock of energy-using equipment in Canada

Reduction of GHG emissions

Source: RMAF: ASAP, 2001, p. 5

This initiative was expected to result in 37.19 petajoules (PJ) of energy savings per year and a reduction of 2.8 Mt of GHG emissions per year in 2010.125

Table 2 outlines the resources used by the Accelerated Standards Action Program during the evaluation period. Approximately $12.4 million was spent over the two years of the Program in the evaluation period.

Table 2: Accelerated Standards Action Program expenditures 2004-05 to 2005-06 (000)
  2004-05 2005-06 Total
Full-Time Equivalents 8.0 8.0 16
Salaries & Wages $1,018 $500 $1,518
Other Operating $1,590 $2,716 $4,306
Corporate Costs $306 $0 $306
Grants and Contributions $2,555 $3,365 $5,920
Employee Benefit Plan $204 $100 $304
PWGSC Accommodations $65 $0 $65
Total $5,738 $6,681 $12,419
Source: NRCan OFSA, 2010

The Accelerated Standards Action Program was going to be extended until the end of fiscal year 2010, but the extension was dropped during the review of the climate change programs in Canada by the newly elected federal government in 2006.126 The Accelerated Standards Action Program was instead extended for only one additional year (2006-07) as part of the Climate Change Interim Strategy.127

EnerGuide for Industry

EnerGuide for Industry—also referred to as Energy Rating System (for industry)—was a five-year, $2.5-million program that was in operation from April 1, 2001 to March 31, 2006. The Program was designed to "target commonly used ‘off the shelf' industrial equipment such as motors, pumps, transformers, compressors, boilers, and lighting products" and had the following two objectives:

  • to identify products and platforms for an energy efficiency labelling/rating program for industry; and
  • to improve the efficiency of the stock of energy-using equipment available for industrial applications by 10% in 2010, thereby leading to reductions in energy use of 19 petajoules and GHG emissions of approximately 1.4 megatonnes.128

The Program planned to meet these objectives by, in the first year, concentrating "on identifying key products and technologies, and the emissions and energy savings that could be targeted by effective information programs," developing information dissemination tools, and identifying information dissemination channels.129 In the following years, the Program was marketed to energy managers, procurement and financial officers, and plant engineers in all industrial sectors.

In 2004-05 and 2005-06, EnerGuide for Industry disseminated communication materials and decision-making tools and promoted the Program to industry procurement officials, equipment manufacturers, distributors, and utilities that offer industry energy efficiency equipment programming.130,131

The intended outcomes of the Program appear in Table 3 (see Appendix B for EnerGuide for Industry's full logic model).

Table 3: Intended outcomes of EnerGuide for Industry
Immediate outcomes Intermediate outcomes Long-term outcomes
Selection of products and platforms suitable for a labelling/rating system program for industry
Awareness within targeted segments of available energy performance information on equipment
Growing market for higher efficiency equipment Reduced GHG emissions stemming from increased availability and use of energy-efficient equipment
Source: ERS RMAF, 2001, p. 4.

Table 4 outlines the resources used by EnerGuide for Industry during the evaluation period. Approximately $0.9 million was spent over the two years of the Program in the evaluation period.

Table 4: EnerGuide for Industry expenditures 2004-05 to 2005-06 (000)
  2004-05 2005-06 Total
Full-Time Equivalents 1.5 1.5 3
Salaries & Wages $118 $120 $238
Other Operating $250 $359 $609
Corporate Costs $24 $0 $24
Grants and Contributions*      
Employee Benefit Plan $24 $24 $48
PWGSC Accommodations $15 $0 $15
Total $431 $503 $934
* Grants and Contributions were not available under this program.
Source: NRCan OFSA, 2010
Enhanced Equipment Market Transformation Program

The Enhanced Equipment Market Transformation (EEMT) Program was initially developed as a four-year, $20-million program. The Program was designed to run from 2003-04 to 2006-07, but the last year of funding for it was put on hold when the new federal government was elected in 2006. While the Program still operated in 2006-07, funding was provided under the Climate Change Interim Strategy.132,133,134

The Enhanced Equipment Market Transformation was introduced as one of five sub-components of the new Early Action Targeted Measures (EATM) identified under the Memorandum to Cabinet, Climate Change: Emissions Reduction Strategy. The EATM was developed to provide a foundation, the tools, and the leadership to improve the energy efficiency of Canada's built environment.135

The Program focused on three targeted sectors: existing housing, new buildings, and existing buildings. The Program had the following two objectives:

  • provide the foundation, the tools, and the leadership for the Canadian built environment to become more energy-efficient and environmentally friendly, and, in so doing, reduce GHG emissions; and
  • increase the adoption of advanced technology systems and products through product deployment, targeted incentives, and information.136

To meet these objectives, the EEMT Program followed two directions:

  • bringing proven but underutilized technologies to full market adoption.
  • more aggressive marketing to replace inefficient equipment in the stock.137

The intended outcomes of the Program, according to the BEERS data, appear in Table 5 (the logic model only provides combined outcomes for the EATM. See Appendix B for the Enhanced Equipment Market Transformation's logic model.

Table 5: Intended outcomes of the Enhanced Equipment Market Transformation Program
Immediate outcomes Long-term outcomes

Define next generation of ENERGY STAR technical criteria

Increase replacement of stock advancing energy savings into target period

Collaborative partnerships on program delivery activities

Contribute to energy/fuel efficiency improvements, energy savings, and/or energy intensity reductions

Contribute to GHG emissions reductions

Source: Equipment BEERS data 2004 and 2005.

Table 6 outlines the resources used by the Enhanced Equipment Market Transformation Program during the evaluation period. Approximately $3.1 million was spent over the two operational years of the Program in the evaluation period.

Table 6: Enhanced Equipment Market Transformation Program expenditures 2004-05 to 2006-07 (000)
  2004-05 2005-06 2006-07 Total
Full-Time Equivalents* 3.0 4.0 Funds frozen as
part of review of
climate change
programs
7.0
Salaries & Wages $225 $300 $525
Other Operating $208 $197 $405
Corporate Costs $0 $323 $323
Grants and Contributions $666 $1,032 $1,698
Employee Benefit Plan $45 $60 $105
PWGSC Accommodations $30 $40 $70
Total $1,174 $1,952 $3,126
* Expected.
Source: NRCan OFSA, 2010.
Climate Change Interim Strategy

The Climate Change Interim Strategy (CCIS) was a $12-million transitional one-year extension program that was a combination of the Accelerated Standards Action Program and the Enhanced Equipment Market Transformation Program in 2006-07. The CCIS was instituted while the climate change program in Canada was under review. While the objectives and outcomes of the CCIS stemmed directly from the Accelerated Standards Action Program and Enhanced Equipment Market Transformation Program, the CCIS Wrap-up Summary from the Demand Policy and Analysis Division (DPAD) outlined the following goals for the one-year strategy:

  • ensure the continuous improvement in energy performance for products used in all sectors of the Canadian economy;
  • develop regulatory labelling proposal for lamps;
  • produce directories for household appliances and air conditioners;
  • develop product databases for range of ENERGY STAR-qualified products;
  • administer NRCan promotion of ENERGY STAR endorsement program; and
  • participate in the Consortium for Energy Efficiency high efficiency support programs.138

Table 7 outlines the resources used by the Climate Change Interim Strategy during its one year of operation. Almost $9 million was spent in 2006-07.

Table 7: Climate Change Interim Strategy expenditures 2006-07 (000)
  2006-07
Full-Time Equivalents* 24
Salaries & Wages $1,943
Other Operating $3,484
Corporate Costs $0
Grants and Contributions $2,896
Employee Benefit Plan $380
Accommodations $229
Total $8,931
* Expected.
Source: NRCan OFSA, 2010
Energy Efficiency Standards and Labelling Program

The Energy Efficiency Standards and Labelling Program (referred to as the Consumer and Commercial Products Regulatory Actions under the Clean Air Regulatory Agenda)139 is a four-year, $32-million program that began operation on April 1, 2007 and is scheduled to end on March 31, 2011. The objective of the Program is "to accelerate the introduction of more energy efficient products in Canada's equipment stock".140 The Program will accomplish this objective by:

  • introducing more stringent minimum energy efficiency performance standards and regulations.
  • deploying a number of enabling programs and strategies to ensure continued improvements and a growing market share of energy-efficient products.141

More specifically, the Program is undertaking the following activities:

  • identify target energy-using products where attractive energy savings exist;
  • determine and design appropriate activities and strategies to eliminate barriers to the market penetration of energy-using products;
  • maintain the regulated EnerGuide and international ENERGY STAR labelling programs;
  • deployment of MEPS (Amendments 10, 11, and 12 to the Energy Efficiency Regulations)
  • define additional high efficiency performance criteria for MEPS and engage stakeholders to make available, promote, or develop programs around products that meet these criteria;
  • build on existing procurement activities, including the Green Procurement Policy; and
  • maintain a multi-layered compliance and enforcement program to ensure an acceptable level of conformity with the requirements.142

By 2011, it is estimated that the Energy Efficiency Standards and Labelling Program will result in energy savings between 13.4 and 14.9 PJ and annual emissions reductions of between 1.4 and 1.6 Mt of GHGs and related criteria air contaminants emissions. In 2020, it is expected that the Program will result in energy savings of 66.626 PJ/year and GHG emissions reductions of between 5.2 and 5.8 Mt/year.143

The above-listed activities are expected to result in the outcomes listed in Table 8 (see Appendix B for the Energy Efficiency Standards and Labelling Program full logic model).

Table 8: Intended outcomes of the Energy Efficiency Standards and Labelling Program
Immediate outcomes Intermediate outcomes Final outcomes

Increased engagement of various publics on energy efficiency issues, and decision-making tools available (i.e., procurement community and general public)

Approval by Cabinet (Governor-in-Council) of amendments to the Energy Efficiency Regulations

Collaborative arrangements and partnerships established; joint programs with partners (i.e., utilities, provinces, trade associations)

Increased scope of comparative labels; stringency for endorsement labels increased

Continuing high rate of compliance to Energy Efficiency Regulations and other performance criteria

New and increased stringency for existing minimum energy performance standards as effected by Amendments 10–12 to Energy Efficiency Regulations

Growing market for high-efficiency equipment

Increased awareness of higher efficiency products and their benefits

Improvements in average energy efficiency of stock of energy-using equipment in Canada, resulting in emissions reductions

Source: RMAF EESLP, 2007, p. 9

Table 9 outlines the resources used under the Energy Efficiency Standards and Labelling Program during the evaluation period. Approximately $13.3 million was spent over the two years of the Program in the evaluation period.

Table 9: Energy Efficiency Standards and Labelling Program expenditures 2007-08 to 2008-09 (000)
  2007-08 2008-09 Total
Full-Time Equivalents* 28 28 56
Salaries & Wages $2,033 $2,088 $4,121
Other Operating $2,704 $2,278 $4,982
Corporate Costs $731 $699 $1,430
Grants and Contributions $888 $1,025 $1,913
Employee Benefit Plan $407 $418 $825
Accommodations $0 $0 $0
Total $6,763 $6,508 $13,271
* Expected.
Source: NRCan OFSA, 2010

Opportunities Envelope

The Opportunities Envelope (OE) was announced in August 2003 as a measure of the Climate Change Plan for Canada, which was released in December 2002. The Opportunities Envelope investment was $160 million over a three-year period (2004–05 to 2006–07) and was conceived as a joint NRCan and Environment Canada program. The Initiative provided the federal government the opportunity to offer financial contributions to provinces and territories "to collaborate with the federal government on new and cost-effective GHG emissions reductions projects and programs to help Canada achieve its Kyoto target".144

By the end of 2006/07, 23 contribution agreements were signed under the Opportunities Envelope, for a total estimated contribution spending of over $35 million. The funded projects were expected to reduce GHG emissions by 2 megatonnes in 2008, which meets the program's expectations.145

The Equipment Sub-Sub Activity administered six projects, for an estimated $15.9 million under the Opportunities Envelope:

  • three incentive space heating programs in New Brunswick;
  • a clothes washer rebate program in Alberta;
  • an energy efficiency market transformation program for buildings and equipment in British Columbia; and
  • a Manitoba Hydro program to encourage the replacement of low-efficiency boilers or furnaces in the residential sector with ENERGY STAR-labelled equipment.
Security and Prosperity Partnership

The Security and Prosperity Partnership (SPP) was launched by the leaders of Canada, the United States, and Mexico in 2005 "to enhance the competitive position of North American industries in the global marketplace and to provide greater economic opportunity for all [North American] societies, while maintaining high standards of health and safety for [its] people".146 In 2007, the leaders developed initiatives that focus on enhancing competitiveness, the safety of food and food products across North America, energy efficiency, and the quality of the environment. The Security and Prosperity Partnership priorities complement several of Canada's priorities, including the harmonization of energy efficiency standards for key products between Canada, the U.S., and Mexico.

During the first year of the Security and Prosperity Partnership (2008–09), the Equipment Division used approximately $0.3 million of Security and Prosperity Partnership funding. Table 10 outlines the resources used by the Equipment Division under the Security and Prosperity Partnership funding during 2008–09.

Table 10: Security and Prosperity Partnership expenditures 2008–09 (000)
  2008–09
Full-Time Equivalents* 1.0
Salaries & Wages $54
Other Operating $221
Corporate Costs $40
Grants and Contributions**  
Employee Benefit Plan $11
Accommodations  
Total $326
* Expected.
** Grants and Contributions are not available under this program.
Source: NRCan OFSA, 2010.

Annex 3: Equipment Logic Models

Logic Model for the Accelerated Standards Action Program

Logic Model for the Energy Rating System (for Industry)

Logic Model for Enhanced Equipment Market Transformation

Logic Model for the Energy Efficiency Standards and Labeling Program

Annex 4: Regulated products under the Energy Efficiency Regulations

Regulated products under the Energy Efficiency Regulations
Automatic ice-makers
Ceiling fans and ceiling fan light kits
Chillers
Clothes dryers
Clothes washers (residential and commercial)
Compact fluorescent lamps – cfls
Dehumidifiers
Dishwashers
Dry-type transformers
Electric motors, 1 to 200 HP (0.746 to 150 kw)
Electric ranges
Electric water heaters
Exit signs
Fluorescent lamp ballasts
Freezers
Gas boilers
Gas fireplaces
Gas furnaces
Gas ranges
Gas unit heaters – commercial
Gas water heaters
General service fluorescent lamps
General service incandescent reflector lamps, ER and BR lamps
General service lamps
Ground- or water-source heat pumps
Integrated over/under washer-dryers
Internal water-loop heat pumps
Large air conditioners, heat pumps and condensing units
Oil-fired boilers
Oil-fired furnaces
Oil-fired water heaters
Packaged terminal air conditioners and heat pumps
Refrigerated beverage vending machines
Refrigerators, refrigerator-freezers and wine chillers
Room air conditioners
Self-contained commercial freezers
Self-contained commercial refrigerator-freezers
Self-contained commercial refrigerators
Single-package central air conditioners and heat pumps: single- and three-phase
Snack and refrigerated beverage and vending machines
Split-system central air conditioners and heat pumps: single- and three-phase
Torchiere lamps
Traffic and pedestrian signal modules
Source: Natural Resources Canada (NRCan). (2009a). Canada's Energy Efficiency Regulations – What's New? Retrieved November 12 2009 from http://oee.nrcan.gc.ca/regulations/11239.

1 Natural Resources Canada (NRCan). (2009k). Mandate and Vision. Retrieved December 17, 2009, from http://www.nrcan-rncan.gc.ca/com/deptmini/manman-eng.php.
2 Minimum energy performance standards refer to the lowest energy efficiency standard an energy-using product must meet in order to meet the regulations. Each regulation set is a minimum energy performance standard.
3 Natural Resources Canada (NRCan). (2006c). Natural Resources Canada 2005-06 Estimates, A Report on Plans and Priorities, p. 25.
4 Natural Resources Canada (NRCan). (2009g). Natural Resources Canada 2008-09 Estimates, A Report on Plans and Priorities, p. 29.
5 See Appendix B and the logic model for the Energy Efficiency Standards and Labelling Program for a current list of activities, outputs, and outcomes of the Equipment Sub-Sub Activity.
6 Energy Efficiency Working Group. (2008a). Energy efficiency in Canada: Status and potential (Foundation Paper). Retrieved from http://www.sst.gc.ca/ED717E3F-17AF-48CB-AE8D-7AC3A6FFC178/Foundation_Paper.pdf p32.
7 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p. 15.
8 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p. 17.
9 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p.23.
10 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p. 23.
11 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm , p. 22.
12 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p. 29.
13 Natural Resources Canada (NRCan). (2009i). Energy efficiency trends in Canada, 1990 to 2005. Retrieved from http://oee.nrcan.gc.ca/Publications/statistics/trends07/index.cfm, p. 32.
14 Minimum energy performance standards refer to the lowest energy efficiency standard an energy-using product must meet in order to meet the regulations. Each regulation set would be a minimum energy performance standard.
15 For more detail on each program, see Appendix A.
16 Energy Efficiency Working Group. (2008a). Energy efficiency in Canada: Status and potential (Foundation Paper). Retrieved from http://www.sst.gc.ca/ED717E3F-17AF-48CB-AE8D-7AC3A6FFC178/Foundation_Paper.pdf.
17 Treasury Board Canada Secretariat (TBCS). (2008). The Clean Air Agenda. Retrieved August 25, 2009, from http://www.tbs-sct.gc.ca/hidb-bdih/initiative-eng.aspx?Hi=12.
18 Government of Canada (G of C). (2008). Speech From the Throne. Retrieved November 10, 2009, from http://www.sft-ddt.gc.ca/eng/media.asp?id=1383.
19 Treasury Board Canada Secretariat (TBCS). (2008). The Clean Air Agenda. Retrieved August 25, 2009, from http://www.tbs-sct.gc.ca/hidb-bdih/initiative-eng.aspx?Hi=12.
20 Natural Resources Canada (NRCan). (2007a). Energy-Efficiency Regulations. Retrieved October 26, 2009, from http://www.nrcan-rncan.gc.ca/media/newcom/2007/200704b-eng.php.
21 Natural Resources Canada (NRCan). (2008a). Amending Canada’s Energy Efficiency Act. Retrieved October 26, 2009, from http://www.nrcan-rncan.gc.ca/media/newcom/2008/200839a-eng.php.
22 The full list of products that fall under the Energy Efficiency Regulations appears in Appendix C.
23 Regulatory Impact Analysis Statement (RIAS) – Amendment 8 (RIAS 8). (n.d.).
24 Regulatory Impact Analysis Statement – Amendment 9 (RIAS 9). (n.d.).
25 Regulatory Impact Analysis Statement – Amendment 10 (RIAS 10). (n.d.).
26 The bulletins are posted on NRCan’s website at the following web address: http://oee.nrcan.gc.ca/regulations/11239.
27 Natural Resources Canada (NRCan). (2009b). What is ENERGY STAR? Retrieved November 16, 2009, from http://oee.nrcan.gc.ca/equipment/energystar/11980, p. 20.
28 Natural Resources Canada (NRCan). (2009c). Part one: Introduction to the Regulations. Retrieved October 27, 2009, from http://oee.nrcan.gc.ca/regulations/16802.
29 Natural Resources Canada (NRCan). (2009c). Part one: Introduction to the Regulations. Retrieved October 27, 2009, from http://oee.nrcan.gc.ca/regulations/16802.
30 The Guide to the Energy Efficiency Regulations can be found under the following path: http://oee.nrcan.gc.ca/regulations/guide.cfm.
31 Natural Resources Canada (NRCan). (2009c). Part one: Introduction to the Regulations. Retrieved October 27, 2009, from http://oee.nrcan.gc.ca/regulations/16802.
32 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON, p. 23.
33 The European Union adopted ENERGY STAR for office equipment only.
34 Natural Resources Canada (NRCan). (2009b). What is ENERGY STAR? Retrieved November 16, 2009, from http://oee.nrcan.gc.ca/equipment/energystar/11980.
35 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON, p. 24.
36 Ipsos Reid. (2009). Discrete Choice Experiment Regarding ENERGY STAR-qualified Products, p. 3.
37 Results-based Management and Accountability Framework, Energy Efficiency Standards and Labelling Program, Energy Technology Programs Sector, Natural Resources Canada. (2007), p. 9.
38 Natural Resources Canada (NRCan). (2009k). Mandate and Vision. Retrieved December 17, 2009, from http://www.nrcan-rncan.gc.ca/com/deptmini/manman-eng.php.
39 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON, p. 6.
40 Lovins, A.B. (2004). Energy efficiency, Taxonomic Overview. In Encyclopedia of Energy (Vol. 2, pp. 383-401), p. 387.
41 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON.
42 Note that the energy savings and GHG emissions reductions estimated in bullet 1 and bullet 2 have some overlap; Amendment 10 contributes to both estimates.
43 Note that the energy savings and GHG emissions reductions estimated in bullet 1, bullet 2, and bullet 3 have some overlap; the Energy Efficiency Standards and Labelling Program activities include Amendments 10 to 12 to the Energy Efficiency Regulations.
44 Natural Resources Canada (NRCan). (n.d.). Methodology for Emissions Reductions Estimates.
45 Bronson Consulting Group (Bronson). (2009). ENERGY STAR in Canada Participant Survey on the Program’s Impact 2008, p. 4.
46 Neubauer, M., deLaski, A., DiMascio, M., & Nadel, S. (2009). Ka-BOOM! The power of appliance standards: Opportunities for new federal appliance and equipment standards (No. ASAP-7/ACEEE-A091). Washington, D.C.: American Council for an Energy-Efficient Economy and American Council on Renewable Energy & Appliance Standards Awareness Project. Retrieved from http://aceee.org/pubs/a091.pdf?CFID=4103315&CFTOKEN=25612711, p. 376.
47 Herring, H. (1994). Is Britain a Third World Country? Energy Policy, 22(9), 779-787, p. 786.
48 Office of the Prime Minister. (2006). Speech From the Throne. Retrieved November 10, 2009, from http://pm.gc.ca/eng/news/2006/04/04/speech-throne.
49 Government of Canada Privy Council Office (G of C PCO). (2007). Speech From the Throne. Retrieved November 10, 2009, from http://pco-bcp.gc.ca/index.asp?lang=eng&page=information&sub=publications&doc=sft-ddt/2007-eng.htm.
50 Government of Canada (G of C). (2008). Speech From the Throne. Retrieved November 10, 2009, from http://www.sft-ddt.gc.ca/eng/media.asp?id=1383.
51 The federal government revised its GHG emissions reductions target in the 2010 Copenhagen Accord to 17% by 2020, relative to 2005 levels.
52 Department of Finance Canada (DFC). (2005). Budget 2005. Retrieved November 10, 2009, from http://www.fin.gc.ca/budtoc/2005/budlist-eng.asp.
53 Department of Finance Canada (DFC). (2006). Budget 2006. Retrieved November 10, 2009, from http://www.fin.gc.ca/budtoc/2006/budlist-eng.asp.
54 Department of Finance Canada (DFC). (2007). Budget 2007. Retrieved November 10, 2009, from http://www.budget.gc.ca/2007/index-eng.html.
55 Department of Finance Canada (DFC). (2008). Budget 2008. Retrieved November 10, 2009, from http://www.budget.gc.ca/2008/home-accueil-eng.asp.
56 Department of Finance Canada (DFC). (2009). Budget 2009. Retrieved November 10, 2009, from http://www.budget.gc.ca/2009/home-accueil-eng.asp.
57 Environment Canada (EC), Health Canada (HC), Transport Canada (TC) and Natural Resources Canada (NRCan). (2008). Clean Air Regulatory Agenda Results Framework, p. 4.
58 Natural Resources Canada (NRCan). (2008d). Natural Resources Canada 2007-08 Estimates, A Report on Plans and Priorities, p. 7.
59 Natural Resources Canada (NRCan). (2009g). Natural Resources Canada 2008-09 Estimates, A Report on Plans and Priorities, pp. 30-31.
60 Natural Resources Canada (NRCan). (2009k). Mandate and Vision. Retrieved December 17, 2009, from http://www.nrcan-rncan.gc.ca/com/deptmini/manman-eng.php.
61 Brown, M.A. (2004). Obstacles to energy efficiency. In Encyclopedia of Energy (Vols. 1-6, Vol. 4, pp. 465-475). Elsevier Inc. p. 471.
62 Sammer, K., & Wüstenhagen, R. (2006). The influence of eco-labelling on consumer behaviour - results of a discrete choice analysis for washing machines. Business Strategy and the Environment, 15(3), 185-199. p. 186.
63 Darby, M., & Karni, E. (1973). Free competition and the optimal amount of fraud. Journal of Law & Economics, 16, 67-88.
64 Harrington, L., & Waide, P. (2004). Labels and standards for energy. In Encyclopedia of Energy (Vols. 1-6, Vol. 3, pp. 599-611). Elsevier Inc. p. 599.
65 Boardman, B. (2004). Achieving energy efficiency through product policy: the UK experience. Environmental Science & Policy, 7, 165-176. p. 170.
66 Harrington, L., & Waide, P. (2004). Labels and standards for energy. In Encyclopedia of Energy (Vols. 1-6, Vol. 3, pp. 599-611). Elsevier Inc. p. 601.
67 Wiel, S., & McMahon, J. (2005). Energy-efficiency labels and standards: A guidebook for appliances, equipment, and lighting (2nd edition). Washington, D.C.: Collaborative Labeling and Appliance Standards Program (CLASP). Retrieved from http://clasponline.org/clasp.online.resource.php?sbo=289, p. 96-97.
68 Drummond, D., Caranci, B., & Tulk, D. (2007). Market-based solutions to protect the environment (TD Economics Special Report). TD Bank Financial Group. Retrieved from http://www.td.com/economics/special/bc0307_env.pdf, p. 4.
69 Boardman, B. (2004). Achieving energy efficiency through product policy: the UK experience. Environmental Science & Policy, 7, 165-176. p. 171.
70 Sage Research Corporation. (2006). 2005-2006 compliance study: Labelling (EnerGuide and ENERGY STAR) and verification marks, and research on EnerGuide and ENERGY STAR (interviews): Final report, version 2. Natural Resources Canada. p. 7.
71 Sage Research Corporation. (2006). 2005-2006 compliance study: Labelling (EnerGuide and ENERGY STAR) and verification marks, and research on EnerGuide and ENERGY STAR (interviews): Final report, version 2. Natural Resources Canada. p. 9.
72 Sage Research Corporation. (2006). 2005-2006 compliance study: Labelling (EnerGuide and ENERGY STAR) and verification marks, and research on EnerGuide and ENERGY STAR (interviews): Final report, version 2. Natural Resources Canada. p. 10.
73 Sage Research Corporation. (2006). 2005-2006 compliance study: Labelling (EnerGuide and ENERGY STAR) and verification marks, and research on EnerGuide and ENERGY STAR (interviews): Final report, version 2. Natural Resources Canada. p .10.
74 Ipsos-Reid Corporation. (2006). Tracking study: Awareness of ENERGY STAR/EnerGuide symbols 2006. Natural Resources Canada. p. 45.
75 Ipsos-Reid Corporation. (2006). Tracking study: Awareness of ENERGY STAR/EnerGuide symbols 2006. Natural Resources Canada. p. 48.
76 Gillingham, K., Newell, R., & Palmer, K. (2009b). Energy Efficiency Economics and Policy (Discussion Paper No. RFF DP 09-13). Resources for the Future. Retrieved from http://www.rff.org/RFF/Documents/RFF-DP-09-13.pdf, p. 12.
77 Jaffe, A.B., & Stavins, R.N. (1994). The energy-efficiency gap: What does it mean? Energy Policy, 22(10), 804-810, p. 809.
78 Brown, M.A. (2004). Obstacles to energy efficiency. In Encyclopedia of Energy (Vols. 1-6, Vol. 4, pp. 465-475). Elsevier Inc., p. 468.
79 Nadel, S. (2002). Appliance and equipment efficiency standards. Annual Review of Energy and the Environment, 27(1), 159-192. doi: 10.1146/annurev.energy.27.122001.083452, p. 160.
80 EnergyConsult. (2006). Retrospective analysis of the impacts of energy labelling and MEPS: Refrigerators and freezers. The Australian Greenhouse Office: Equipment Energy Efficiency Program. Retrieved from http://www.energyrating.gov.au/library/pubs/200614-meps-rf-fz.pdf, pp. E-2.
81 EnergyConsult. (2006). Retrospective analysis of the impacts of energy labelling and MEPS: Refrigerators and freezers. The Australian Greenhouse Office: Equipment Energy Efficiency Program. Retrieved from http://www.energyrating.gov.au/library/pubs/200614-meps-rf-fz.pdf, pp. E-2.
82 Gillingham, K., Newell, R., & Palmer, K. (2009a). Energy Efficiency Economics and Policy. Annual Review of Resource Economics, 597-619. p. 598.
83 Colombier, M., & Menanteau, P. (1997). From energy labelling to performance standards: some methods of stimulating technical change to obtain greater energy efficiency. Energy policy, 25(4), 425–434. p. 427.
84 Brown, M.A. (2004). Obstacles to energy efficiency. In Encyclopedia of Energy (Vols. 1-6, Vol. 4, pp. 465-475). Elsevier Inc. p. 473.
85 Gillingham, K., Newell, R., & Palmer, K. (2009b). Energy Efficiency Economics and Policy (Discussion Paper No. RFF DP 09-13). Resources for the Future. Retrieved from http://www.rff.org/RFF/Documents/RFF-DP-09-13.pdf.
86 Howarth, R.B., & Sanstad, A.H. (1995). Discount Rates and Energy Efficiency. Contemporary Economic Policy, 13, 101-109.
87 Nadel, S. (2002). Appliance and equipment efficiency standards. Annual Review of Energy and the Environment, 27(1), 159-192. doi: 10.1146/annurev.energy.27.122001.083452 p. 160-161.
88 Research on the impact of information and labelling on consumer behaviour related to equipment and appliances is still preliminary and inconclusive, and caution should be used in generalizing the results.
89 A Discrete Choice Modelling approach was used for the study. Discrete Choice Modelling, “is used to predict the choices that consumers will make between alternatives by testing various options against one another in a controlled setting. The results are then used to understand the importance of different aspects of each package, and predict the acceptance of various package configurations. In this case, the discrete choice exercise involved two separate series of questions asking consumers to repeatedly choose between several different models of refrigerators and flat screen televisions”. (Ipsos Reid, 2009, p. 4).
90 Ipsos Reid. (2009). Discrete Choice Experiment Regarding ENERGY STAR-qualified Products, p. 3.
91 The ENERGY STAR label was introduced in Canada by NRCan in 2001 under the Accelerated Standards Action Program.
92 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON. pp. 24-25.
93 Energy Efficiency Working Group. (2008d). Factors affecting the impact of energy efficiency incentives (Issue Paper No. 8). Retrieved from http://www.sst.gc.ca/ED717E3F-17AF-48CB-AE8D-7AC3A6FFC178/%238_Factors_affecting_EE_Impacts.pdf.
94 Jaccard, M. (2005). Sustainable fossil fuels: The unusual suspect in the quest for clean and enduring energy. New York, NY: Cambridge University Press.
95 NRTEE. (2005). Economic instruments for long-term reductions in energy-based carbon emissions. National Round Table on the Environment and the Economy. Retrieved from http://www.nrtee-trnee.com/eng/publications/energy-based-carbon-emissions/full-report/Energy-Based-Carbon-Emissions-FullReport-eng.pdf.
96 Natural Resources Canada (NRCan). (2005a). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2004-2005. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON., p. 14.
97 Natural Resources Canada (NRCan). (2006a). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2005-2006. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON., p. 13.
98 Natural Resources Canada (NRCan). (2007b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2006-2007. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON., p. 15.
99 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON.
100 Shen, J., & Saijo, T. (2009). Does an energy efficiency label alter consumers' purchasing decisions? A latent class approach based on a stated choice experiment in Shanghai. Journal of Environmental Management, 90(11), 3561–3573. p. 3569-3570.
101 Shen, J., & Saijo, T. (2009). Does an energy efficiency label alter consumers' purchasing decisions? A latent class approach based on a stated choice experiment in Shanghai. Journal of Environmental Management, 90(11), 3561–3573. p. 3572.
102 Bernstein, M.A., & Griffin, J. (2004). Regional differences in the price-elasticity of demand for energy (Technical Report). RAND Corporation. Retrieved from http://www.rand.org/content/dam/rand/pubs/technical_reports/2005/RAND_TR292.pdf, p. 7.
103 Natural Resources Canada (NRCan). (2007b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2006-2007. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON. p. 15.
104 Bronson Consulting Group (Bronson). (2009). ENERGY STAR in Canada Participant Survey on the Program’s Impact 2008, pp. 94-101.
105 Natural Resources Canada (NRCan). (2009l). Energy consumption of major household appliances shipped in Canada, summary report: Trends for 1990-2007. Retrieved from http://oee.rncan.gc.ca/publications/statistics/cama09/pdf/cama09.pdf, p. ii.
106 Natural Resources Canada (NRCan). (2009l). Energy consumption of major household appliances shipped in Canada, summary report: Trends for 1990-2007. Retrieved from http://oee.rncan.gc.ca/publications/statistics/cama09/pdf/cama09.pdf, p. 13.
107 Herring, H. (1994). Is Britain a Third World Country? Energy Policy, 22(9), 779-787.
108 Nadel, S. (2002). Appliance and equipment efficiency standards. Annual Review of Energy and the Environment, 27(1), 159-192. doi: 10.1146/annurev.energy.27.122001.083452 pp. 167-169.
109 Dewees, D. (2010). Shocker: We don't pay enough for electricity. The Globe and Mail. Retrieved from http://www.theglobeandmail.com/globe-debate/shocker-we-dont-pay-enough-for-electricity/article1207337/.
110 Macdonald, N. (2009). One colossal waste: Are higher water, hydro and food bills just what we need to force us to conserve? Maclean's. Retrieved from http://www2.macleans.ca/2009/10/08/one-colossal-waste/.
111 Rosenfeld, A., & McAuliffe, P. (2004). Energy efficiency and climate change. In Encyclopedia of Energy (Vol. 2, pp. 373-382). p. 373.
112 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON.
113 Gillingham, K., Newell, R., & Palmer, K. (2004b). The effectiveness and cost of energy efficiency programs. Retrieved from http://www.nicholas.duke.edu/people/faculty/newell/GillinghametalResources.pdf, p. 25.
114 Harrington, L., & Waide, P. (2004). Labels and standards for energy. In Encyclopedia of Energy (Vols. 1-6, Vol. 3, pp. 599-611). Elsevier Inc. p. 600.
115 OECD. (2008). Household behaviour and the environment: Reviewing the evidence. Organisation for Economic Co-operation and Development. Retrieved from http://www.oecd.org/dataoecd/19/22/42183878.pdf, p. 102.
116 Several energy efficiency programs administered at a provincial and federal level are described in Appendix D, but it should be recognized that even these represent only a subset of existing programming.
117 The Paper Burden Reduction Initiative was a Government of Canada initiative to reduce businesses’ paper burden by 20% by November 2008. Visit http://www.tbs-sct.gc.ca/hidb-bdih/initiative-eng.aspx?Hi=52 for a full description of the initiative.
118 Natural Resources Canada (NRCan). (2009k). Mandate and Vision. Retrieved December 17, 2009, from http://www.nrcan-rncan.gc.ca/com/deptmini/manman-eng.php.
119 See Annex 1 for a description of the work the Canadian Standards Association does in association with NRCan on standards.
120 Interview with a proponent was not completed for this case study because no one that is currently employed at SaskEnergy worked on the project.
121 Interview with a proponent was not completed for this case study because the proponent was not available.
122 Interview with a proponent was not completed for this case study because no one from BC Energy Efficiency Market Transformation Program for Buildings and Equipment was available.
123 Results-based Management and Accountability Framework for: Accelerated Standards Action Program (RMAF: ASAP). (2001). p. 1.
124 Results-based Management and Accountability Framework for: Accelerated Standards Action Program (RMAF: ASAP). (2001). pp. 2-3.
125 Results-based Management and Accountability Framework for: Accelerated Standards Action Program (RMAF: ASAP). (2001). p. 1.
126 Natural Resources Canada, Office of the Sector Financial Advisor (NRCan OSFA). (2010). Requested financial information for the Energy Efficiency Equipment Evaluation (2004-05 – 2008-09).
127 The Climate Change Interim Strategy is described below.
128 Energy Rating System (for industry) Results-based Management and Accountability Framework (ERS RMAF). (2001). p. 1.
129 Energy Rating System (for industry) Results-based Management and Accountability Framework (ERS RMAF). (2001). p. 2.
130 EnerGuide for Industry BEERS Data (BEERS EGI). (2004).
131 EnerGuide for Industry BEERS Data (BEERS EGI). (2005).
132 The Climate Change Interim Strategy is described below.
133 Built Environment Energy Efficiency Measures (Results-based Management and Accountability. Framework) (BEEEM RMAF). (2003). pp. 15-16.
134 Natural Resources Canada, Office of the Sector Financial Advisor (NRCan OSFA). (2010). Requested financial information for the Energy Efficiency Equipment Evaluation (2004-05 – 2008-09).
135 Built Environment Energy Efficiency Measures (Results-based Management and Accountability Framework) (BEEEM RMAF). (2003). pp. 1, 4.
136 Climate Change Review – Mitigation Stream. (2005).
137 Built Environment Energy Efficiency Measures (Results-based Management and Accountability. Framework) (BEEEM RMAF). (2003). p. 15.
138 Demand Policy and Analysis Division (DPAD). (n.d.). Climate Change Interim Strategy (CCIS) Wrap-up Summary from DPAD – Equipment Only.
139 The Clean Air Regulatory Agenda includes nine themes, one being Consumer and Commercial Products Regulatory Actions (CCPRA). CCPRA includes two components: one under the authority of Environment Canada and the other under the authority of NRCan.
140 Results-based Management and Accountability Framework, Energy Efficiency Standards and Labelling Program, Energy Technology Programs Sector, Natural Resources Canada. (2007). p. 6.
141 Results-based Management and Accountability Framework, Energy Efficiency Standards and Labelling Program, Energy Technology Programs Sector, Natural Resources Canada. (2007). p. 6.
142 Results-based Management and Accountability Framework, Energy Efficiency Standards and Labelling Program, Energy Technology Programs Sector Natural Resources Canada. (2007). pp. 4-5.
143 Natural Resources Canada (NRCan). (2008b). Improving Energy Performance in Canada, Report to Parliament Under the Energy Efficiency Act for the Fiscal Year 2007-2008. Energy Publications, Office of Energy Efficiency, NRCan, Ottawa, ON. p. 26.
144 Environment Canada (EC). (2006). Evaluation of the Opportunities Envelope. pp. 5-6.
145 Natural Resources Canada (NRCan). (2007c). Natural Resources Canada Performance Report for the Period Ending March 31, 2007. p. 29.
146SPP.GOV. (n.d.). Prosperity Agenda – Security and Prosperity Partnership of North America. Retrieved November 24, 2009 from http://www.spp.gov/prosperity_agenda/index.asp?dName=prosperity_agenda.