Why Canada is not (really) interested in fighting climate change

The release last week of the Pembina Institute/Suzuki Foundation study “Climate Leadership, Economic Propserity” on the economic impact of addressing Canadian carbon emission targets has sparked criticisms from both politicians and media. Reactions from western politicians as well as Federal Ministers were understandably negative. But so was the Globe and Mail in its editorial position. Why?

A couple of weeks ago, I was finally given a candid explanation by a senior federal government official (who shall remain nameless) as to why fighting climate change and reducing its impact is not a high priority for Canada. He listed a number of perceptions currently shared by many federal politicians:

The first perception is that global warming will not hurt us. Unlike for developing countries, the impact of climate change on Canada will not be very severe. The US will suffer slightly more that us. But on the whole, the impact of global warming on our landmass will not be devastating compared to some developing countries, and in fact may have some benefits for us. At least that is the shared view.

Rising water levels and coastline erosion will not have a major impact, because most of Canada's coastline is largely uninhabited. Some small fishing villages may suffer, but these have very small populations.

Forced migrations from more vulnerable developing countries will not hit us as hard as say Florida, Australia or Europe, because Canada is more difficult to reach.

There is even the sense that global warming might in fact benefit us. Rising temperature would increase the productive agricultural areas, and would allow the production of new crops which until now could not grow in the cold climate.

However, the economic cost to Canada of addressing climate change head-on will be very high. The recent economic growth of Western and Atlantic Canada is largely based on oil, gas and coal. Canada has become the largest provider of petroleum to the United States, surpassing Saudi Arabia. So shutting that industry down will cause serious harm to the Canadian economy and Canadian jobs. And that is a very price to pay, economically and politically, for any federal government looking for a majority.

Bottom line: the general perception is that living in a warmer climate and adapting to it will be far less costly to the economy or the job market than making major efforts to reduce carbon emissions and getting the country "off-oil". That is what my federal official said.

This is the most succinct explanation I’ve heard to date as to why the current federal government is seen to be dragging its feet in supporting climate change mitigation or any serious move to a sustainable society, domestically and internationally. The hurt of doing nothing is much less than the pain of going off-oil – at least in the way my friend and his colleagues see it.

Furthermore, a province like Ontario, which is not a petroleum or fossil fuel producing exporting province, is driven by a need to revitalize its manufacturing industry. It has chosen to do so by promoting a renewable energy industry. And that explains its strong support of renewable energy and conservation through such measures like the Green Energy Act.

Needless to say, I found that perspective to be somewhat discouraging. But I was grateful to my interlocutor for expressing his view so clearly so that even I could understand it.

What can be done?

Going back to the analysis underpinning our study “Making it happen”, when faced with such a clear anti-global warming set of premises, it becomes easier to develop a strategy to shift these. We can analyze these perceptions and use them as a basis for defining our challenges. And we can formulate these challenge statements as following, for example, using the phrase “How might we…?”:

How might we show in a convincing way the scale of the long-term harm to Canada of rising temperature, e.g. invasive species such as the pine beetle, droughts in the prairies, or growing number of extreme climate events?

How might we demonstrate the increased vulnerability of Canadian agriculture to these warmer temperatures and increasing climate changes and their ecological effects?

How can we make it irresistible for Western and Atlantic provinces to go “off oil”, and develop an attractive business proposition that a non-petroleum economy would be far better for them in the long run?

It’s high time that these issues be brought into the open and debated fully and clearly.

A good example of holistic change: the Ontario Green Energy Act

Barriers to innovation and change have to be addressed holistically. That is one of the conclusions in our "Making it happen" study. A clear example of this has been confirmed to me last week when talking to a couple of people involved in the preparation of Ontario's Green Energy Act.

What makes this particular piece of legislation unique is the integrated and holistic approach it takes to address the intended challenge project. Specifically, the act contains a dozen or more amendments to other provincial statutes, to eliminate specific barriers to the deployment of renewable energy. In other words, the officials and consultants involved in drafting this legislation went to great lengths to identify the barriers and obstacles existing in other provincial laws and statutes that would impede the deployment of renewable energy.

What has intrigued me ever since the Act was first tabled is how these obstacles and different statutes were identified. In other words what was the holistic process used in developing this legislation to eliminate all these obstacles.

Last week, I finally had opportunity to talk to a couple of people who were involved in consulting stakeholders and develop a vision for the act, and who were responsible for drafting the final legislation.

What emerges is a very conscious and deliberate attempt to take an integrated approach. First of all, this initiative was led from the very top in the provincial government, all the way from the Premier's office. Based on our previous work on sustainable communities, such leadership is essential if you want to break silos and build collaboration across jurisdictions.

The process followed a number of steps. Extensive consultations were undertaken through the Green Energy Act Alliance, involving various stakeholder groups: First Nations, farmers, advocates and practitioners, current and retired employees of local distribution, companies and municipalities, civil servants, lawyers, business leaders and a broad representation of nongovernmental organizations. This allowed for each stakeholder group to identify what they saw as the opportunities, obstacles and barriers. A key output of these consultations was the production of a Vision for a Greener Energy System for Ontario.

Another process was taken by senior legal officials in the Ministry of Energy and Infrastructure responsible for drafting the actual legislative text. Together with a team of legal experts from other ministries, they examined the specific regulatory/legal obstacles in the various statutes and looked at the legal implications of changing them. When needed, they verified with those responsible for the central policy (which presumably meant going back to Ministers when necessary) to ensure that these could be amended.

My inquiries were by no means comprehensive, or even sufficient to write a full case study. But they do point to a number of elements essential to such a holistic approach:

1. There was leadership at the very top


2. There was broad consultation with external stakeholders


3. There was intensive internal consultation within the provincial bureaucracy led by Cabinet to eliminate legal and other institutional barriers in other Ministries


4. The process took about three to four months, from November 2008 to February 2009 when the legislation was tabled, i.e. not an exorbitant Amount of time.

In other words, there was a conscious will and focused effort to identify all the barriers and obstacles that would impede the implementation of renewable energy. Moreover, these obstacles and barriers had to be addressed in the new legislation.

This is the kind of approach that has to be far more prevalent at all levels of government if we are to move to a sustainable society.

Incidentally, one of the government lawyers tells me that that he remembers this approach being used only once previously. This was in the 1980s (!), when a consumer protection legislation was being considered.

So we have a long way to go before this becomes prevalent.

Final Report

Our final report and all the background research papers are now available at http://makingithappen.ca/ .

Click here to download the final PDF summary and recommendations.

Highlights from Phase I report:

Here are some highlights to expect in our Phase I report, “What the federal government should do to remove barriers to innovation and change, and lead Canada to a sustainable society":

• Canada already has all the technology needed to reduce greenhouse gases by 60% within two decades.
  


• What's stopping us from deploying these technologies are deep rooted institutional, legal, regulatory and economic barriers, such as lack of standards and proper metrics, inadequate financial instruments to pay for energy conserving measures, restricted leasing contracts and an insufficient supply of skilled labour.
  


• Some 100 such barriers to innovation and change for sustainability have been identified, e.g:
  


• The federal government should start by setting a compelling example. For instance, a federal government department can be disinclined to implement energy conserving measures because it is a tenant and not the owner of the building it inhabits. The divergent interests of landlord and tenant are a barrier to action that can be overcome by a new leasing arrangement between the department and the agency that acts as its landlord.
  


• While Canadian homes should all be energy efficient, it would require a million trained contractors to retrofit all existing housing units in Canada for energy efficiency. There are no provisions currently to train or certify this number of building contractors.
  
  
• Many of these can be addressed by stronger collaboration among governments and better ways of measuring our progress

• The report calls on the federal government to take on a role of leadership by example, by facilitation and by direction.
  

Stay tuned for the complete report on-line by September 3, 2009

Overcoming barriers: finding innovative ways to monitor GHG emissions

The Commissioner of the Environment and Sustainable Development published today a report on the government's compliance to the Kyoto Protocol Implementation Act that was passed in 2007 in the House of Commons, by all parties save the governing party. Obviously, this can only happen in the minority government situation.

From our perspective of barriers to change and innovation, it is worthwhile to look at just one aspect of the auditor’s critique, namely the lack of proper monitoring system. I don't want to belabor the point as to whether environment Canada did or did not fulfill its duty with regards to monitoring GHG emissions, or the requirements of the Act. But I do want to focus on the critical importance of having such a monitoring system in any change management process, which is what a transition to a sustainable society is all about.

As our research has shown today, especially using the example of the residential sector, deploying green technologies that dramatically reduce GHG emissions, water use and wastewater generation, and garbage, requires a very large number of small decisions. More importantly, the barriers to these innovations and changes cover all jurisdictions and within each jurisdiction, go across several departments and silos. There is no single golden bullet. But there are some overall metrics with relations to GHG emissions, water, energy usage and so on. And we discussed these in an earlier post (see Setting sustainability and environmental targets (1): Recent announcements on GHG emissions ; Setting sustainability and environmental targets (2): the dimensions of sustainability, and Setting sustainability and environmental targets (3): Ottawa’s “Choosing our future”)

Keeping track of how each of these small decisions, in all the sectors of the economy, contributes to achieving these objectives is critical in any change management strategy. However, a full monitoring system is not a trivial matter. It requires a fairly significant bureaucratic infrastructure and reporting structure. A good analogy is what statistics Canada uses to poll on a monthly basis the necessary manufacturing shipments and inventory data from Canadian corporations to provide the key monthly indices off economic growth and performance. However, in this instance we would be looking at all sectors of the economy, including transportation, residential, commercial, as well as industrial. We would need to not only baseline data, but the rate of implementation of new technologies to achieve these environmental objectives. This is not a trivial task. But it is essential to invest in building up such a system if we ever hope to achieve Kyoto targets.

More importantly, it is a classic example of the real barriers to achieving a sustainable society, where power, information, and resources are broadly dispersed among a wide range of stakeholders, and where effective coordination is needed. (See, for example, Gilles Paquet’s studies on governance)

With some creativity, this exercise could be turned into a hugely motivating process, that could help engage the whole country. Let’s look at one sector, not mentioned in the Commissioner’s report, which we have studied in the course of our study: the residential sector.

Depending on whose definition you take, households in Canada contribute anywhere from 10 to 40 -50% of GHGs. The low end estimate looks only at the actual physical house and residential unit, the high end extends the GHG emissions to each family’s lifestyle, including what they do, how they travel and where they go to work. In fact, it can include all of the community, excluding industry.

So the challenge is to how to help each individual household monitor as accurately as possible their own progress towards achieving each reduction objectives with regards to GHG, electricity, energy and water usage reduction. And each company or enterprise could do the same, as well as each commercial building or complex. Putting all the blame on the Environment Canada, which is pretty strapped in terms of budgetary resources, is not likely to find a quick solution. Instead, why don't we throw open the challenge and find innovative ways to engage the various key sectors to determine better ways for tracking their improvement along the pathway to sustainability and GHG reductions.

Staying with the residential and community sector, we would first need some standards and common definitions, to make sure that the accounting is consistent. And the federal government and Natural Resources Canada have a well-established track record in doing so with the Energuide program. We will need new and much more user-friendly meters in each household that can track, for example, the improvement in energy consumption or water usage, or gas heating and electricity consumption. This would allow each of us to track and become aware in real time how a new appliance, a new device or a change in practice helps achieve the reduction objective. The idea is to make this cause-and-effect as clearly visible and understandable as possible. There is ample opportunity for incentives, standards and new metering products to address this task. It could be a unique opportunity for new businesses and jobs.

And by putting the responsibility on individuals, while helping them with easy to use tools to measure progress, we not only empower them, but provide a context to unleash a unprecedented flow of innovative ways to reduce GHG emissions.

“Ecoflation”: a barrier or an opportunity?

In today's Financial Post, Diane Francis brings up the term "ecoflation" first reported in a December 2008 article by Deborah Zabarenko, Environment Correspondent for Reuters.

In essence, the argument states that a barrage of environmental legislation, regulations and taxes to address environmental degradation and global warming will significantly raise the price of consumer goods and hurt the profitability of the companies that manufacture them. This view is strongly held by many business leaders. And it is a crucial perceptual barrier to any major progress on moving to a sustainable society.

To this argument, I respond by reiterating UK’s Lord Stern’s position that the long-term cost to the planet as a whole will be dramatically higher if we don't put these measures in place to address global warming.

As our project "Making it happen" demonstrates, we do need to change the way we run our economy, use resources, and build our infrastructures, if we want to become a sustainable society. And what we have been doing is looking at what are the barriers to achieve this.

But the more pertinent question here is whether those changes in infrastructure, in our manufacturing processes, and in the creation of new "green" industries and businesses, would lead to a more resilient economy.

Never mind the fact that the Arctic ice cap is melting 30% faster than any previous projection. The urgency for re-examining some of our traditional concepts of economic growth comes from another corner. The largest corporations in the United States, including GM (not to mention the Phoenix Coyotes) are on the brink of bankruptcy, something that was unheard of a year or two ago. Whatever happened to that old adage "What is good for GM is good for America"?

And here is the challenge to all of those researching what a green economy in Canada might look like: can we demonstrate persuasively that “ecoflation”, what Diane Francis and Deborah Summer consider to be a curse, might in fact be the pathway to the economic salvation and long term sustainability?

Can we be creative and find ways to devise new business models, new concepts of community, and longer-term security as a result of this transition?

Why we need more Clean Energy Acts

Technology alone won’t achieve sustainability -- we also need to address the human and social factors


Despite the head-line-grabbing economic downturn, climate change is still making news: melting Arctic ice shelf, severe drought in Argentina, and unprecedented heat waves and wildfires in Australia.

A lot has been written about sustainable development and how to stop climate change. But much less has been written about how to make it happen.

Ontario has just tabled a far-reaching Clean Energy Act last monthwhich goes a long way in that direction. But there is still room for more.

We know we could reduce our green house gas emissions by 60% by the year 2050, and surpass Kyoto targets in the process. Most of the technologies to do that already exist.

Now it's not a technological fix by itself that will solve that. Green technology alone will not stop climate change. What is critical is to make sure that these technologies actually get deployed and used in our society. That requires a multi-dimensional effort crossing all levels of governments to make these technology choices available, affordable and acceptable to consumers. What our society needs is in-depth change management.

For the last few months, our team at the University of Ottawa has been examining the various barriers to sustainability: what’s stopping innovation and change that would result in a systematic transition to a sustainable society.

And what we are discovering is a whole range of barriers to innovation and change: social, economical, legal, institutional, human, attitudinal, etc. that prevent large-scale deployment of green technology.

Here’s an example. We know how to build a very efficient or zero energy house. The technologies to do that have been known for years. So how come we're not using them? That was the subject of a workshop at the University of Ottawa last week, where practitioners, builders, real estate agents, developers and researchers explored the barriers to making the residential sector totally green.

Cost has a lot to do with barriers to change. Many energy efficiency and environmentally clean options for residential houses require an upfront investment few are willing to make. The roller coaster price of oil and natural gas over the last two or three decades have not helped to establish a stable rate of return or payback. And building owners should not be expected to absorb all these costs. This raises a number of questions: how might we use municipal and property taxes to encourage energy efficient houses and buildings? Can we change mortgage requirements to look at the entire lifecycle cost of a house, including energy savings? Can we convince utilities, who save money from avoided capacity increases, to help out?

There's also the training of builders and contractors, so they can learn how to integrate these new technologies in the existing building systems. The challenge is to retrofit and renovate all the existing houses and buildings in Canada to be energy efficient. We estimate that the total number of contractors and trades people needed to be approximately 1 million FTEs. That’s a lot of new jobs. And no one is addressing how to meet that need.

The mandatory energy audit before selling a house proposed in the new Clean Energy Act will go a long way to signal to potential buyers that there is a real measurable dollar value associated with energy efficiency. But it is only one of many measures to encourage energy efficient retrofits. Those who object to it should realize it’s no different from having to pay $80 to get a car safety-checked before selling it.

Another barrier is NIMBY, as we recently saw in the cases of windmill farms or large solar photovoltaic installations. Despite the promise of environmental benefits, neighborhoods have objected to such installations. The new Clean Energy Act is addressing this barrier very clearly for new renewable technologies.

But there are still many other areas of social and economic activity that need to be addressed. In the commercial sector, landlords generally want to minimize upfront investments, even if it will reduce energy operating costs for the tenants. That might require a change in legislation governing leases.

Transportation is another area. Here’s a simple example: inflating your car tires to the correct pressure can save between 4 and 8% of gasoline consumption. Yet studies show it’s much easier to wash your car than to check your tire pressure accurately. In fact, many gas stations don’t even have properly calibrated air pumps. Changing that is complex, and involves change management, industry cooperation, shift in consumer attitudes and motivation.

Convenience and availability are other factors. Many energy efficiency products are often inconvenient to use, e.g. meters that can be read only with great difficulty or provide incomplete data. And some products are very difficult to find in your local store. Changes in product design, standards and codes should help address these deficiencies.

And I haven’t mentioned industry, or regional development.

Unlike any previous social change in our history, the transition to a sustainable society will require an unprecedented level of cooperation between cities, provinces and the federal government. But at the end of the day, consumers need to be aware. And they need to be able to chose acceptable green products and services that are affordable, accessible, and available. That is no mean feat, and will require more legislative and regulatory changes.

Making the residential sector totally green: Initial Feedback

Our workshop on February 23 was a total success, judging by participant’s reaction and media coverage. Over 40 people attended and spent the day probing the underlying causes of “What’s stopping us from making the residential sector totally green?”.

As we wait for the final workshop proceedings, Patrick Langston of The Ottawa Citizen wrote this:

"Lack of public awareness and financial aid is stymieing the greening of Canadian homes, according to participants in a workshop promoting eco-building techniques earlier this week.
More than 40 participants tried to understand why the green movement is not going faster, since homes generate one-tenth of Canada's greenhouse gases, and technologies, innovations and practices are available to reduce emissions by 60 per cent by 2030.
"The workshop, which is part of a two-year research project by the University of Ottawa's Telfer School of Management on transitioning to a sustainable society, took place the same day the provincial government announced Ontario's Green Energy Act to promote residential energy efficiency.
"Yet participants made it clear that basic information about the availability, cost, and economic and environmental benefits of energy efficiency technologies is lacking among everyone, from developers and buyers, to real estate agents and lenders."



Peter Kovessy of the Ottawa Business Journal writes that at our workshop, “several green residential experts said previous government incentive programs, aimed at encouraging home energy efficiency upgrades, have a mixed record at best.

Rather than public subsidies, participants at a workshop examining barriers to reducing the impact of climate change in the residential sector suggested the government do a better job promoting measurable standards for home energy efficiency.”

In addition to some of the leading participants such as Mathew Sachs of Urbandale, and David Foster of the Canadian Home Builders Association, Kovessy makes reference to three MBA student presentations, which extracted lessons learned from the evaluation of past programs in energy efficiency in the eighties and nineties.

In referring to low number of houses that had been built under the R-2000 program, “by that standard the program has not been very successful, concluded Anne Murray Choudhary, a University of Ottawa MBA candidate who analyzed evaluations of the program conducted up to 1995.

In that time period, only 6,500 homes were built to the standards, she said, noting there was low public awareness and a high amount of paperwork required of builders.
Likewise, the Canadian Oil Substitution Program, in place between 1980 and 1985 to reduce the country's reliance on foreign oil, was "not particularly" effective, said another MBA student, Jason Spears.

The government handed out $715 million in subsidies to homeowners to switch their heating systems from oil to alternatives. While the program led to nearly $2 billion in conversions, two-thirds of surveyed participants said they would have made the switch regardless, said Mr. Spears, adding regional differences, such as the lack of natural gas access in Atlantic Canada, hampered the effectiveness of the one-size-fits-all program.

The Canadian Home Insulation Program was similarly established in 1977 and ran for a decade to shield the country from possible future oil shocks by saving energy used for space heating, explained MBA candidate Benedicte Losfeld.

The program only achieved 17-per-cent energy savings among participants, off from the expected 30 per cent, said Ms. Losfeld.

Interim project chair Tom Brzustowski said there hasn't been enough emphasis on management in sustainability discussions given the main impediments tend to be institutional, jurisdictional and cultural, rather than technological.

"There seems to be no shortage of knowledge or innovation," he said. "Maybe we've been too preoccupied with ideas and haven't spent enough time putting things into practice."

Overcoming barriers to innovation and change: the creation of a new international agency to promote renewable energy.

Last month marked the creation of a new international agency, the International Renewable Energy Agency (IRENA), exclusively focused on the promotion of renewable energy technologies.

More than 120 government delegations from across the world attended a conference in Bonn. The Agency’s statute was signed on January 26, 2009 by a total of 75 nations, a broad cross-section of developing and industrialized countries. Canada did not attend.

The initiative was led by Germany, Denmark, Spain, and Poland.

“The founding of IRENA is a milestone on the road towards a future-oriented energy supply. It is a clear sign that the global energy paradigm is changing and that more and more governments are committed to accelerating that shift.”

“The aim of the new Agency is to work throughout the world to close the gap that exists between the enormous potential of renewables and their current relatively low market share in energy consumption. IRENA is the first international organisation to focus exclusively on the issue of renewable energies, addressing both the industrialized and the developing world. The main work of IRENA will be to advise its members on creating the right frameworks, building capacity, and improving financing and the transfer of technology and know-how for renewable energies. IRENA seeks to cooperate closely with other international organisations and institutions active in the field of renewable energy.”

For more information, see www.irena.org

Program update: What's stopping us from making the residential sector totally green

Here's a program update to our February 23 workshop at U of Ottawa Telfer School, as of Friday, February 6 2009.

We have reached 75% of our registration objective. So hurry, space is limited.


Some of our presenters and resource persons as of today:

Hugh MacLeod, Associate Deputy Minister to the Premier of Ontario: Climate Change
Peter Love, Chief Energy Conservation Officer,Conservation Bureau, Ontario Power Authority
Ralph Torrie, Navigant Consulting
David Foster, Director of Environmental Affairs,Canadian Home Builders’ Association
Gordon Shields, Executive Director,Net-Zero Energy Home Coalition
Dana Silk, General Manager, Envirocentre, Ottawa
Chris Higgins, Coordinator, LEEDR Canada for Homes, Canada Green Building Council
Bob Linney, Canadian Real Estate Association
Tom Green, project manager, EQuilibrium™ Housing, CMHC
Representatives from City of Ottawa, Ville de Gatineau

Preliminary results from the Telfer School research project
on barriers to innovation and change

For program background, click here

For registration, click here

Inconvenience with public transit: A barrier to innovation and change

With the end of the disastrous two-month public transit strike in Canada’s National Capital, people are wondering what can OC Transpo do to regain its former popularity among commuters. Mike Kesterton of the Globe and Mail has pointed us to an interesting story by Fox News about novel technologies that would make public transit more convenient, eliminating some of the current barriers:

TransitTracker
"For commuters who have to choose between breakfast and catching the bus, companies such as TransitTracker keep tags on buses and trains so you can track them online or on your cell phone.

The system follows your ride's actual location — not an estimated schedule — so you know exactly when it will arrive at your station or stop." It’s currently being used in Portland, Oregon.

iNap
"Once you're on that train or bus, you can finally get back to what matters most: going back to sleep.

Thanks to an ingenious iPhone application called iNap (get it here) , the phone's built-in GPS device will track your location (as long as you're above ground) and set off an alarm when you're near your destination — not too soon, not too late, leaving you little excuse to be grumpy when you actually arrive."

What's stopping us from making the residential sector totally green?

A special workshop on identifying barriers to change and innovation
to reduce impacts of climate change in the residential sector

When: Monday, February 23, 2009, 9:00 am to 4:00 pm
Where: Telfer School of Management, University of Ottawa, Room 4101
55 Laurier East, Ottawa, K1N

The residential sector in Canada generates at least one tenth of greenhouse gases. These emissions can be reduced by as much as 60% by the year 2030. All this requires is the deployment of known technologies, innovations, and practices, already in the market.
What's stopping us from reaching that objective?

Key questions to be addressed:

What have we learned?
Over the last thirty years we have tried to reduce usage of fossil fuels. Many of the necessary technologies already exist and are available in the market. Refinements and improvements are always possible, but there is enough available already to make a big difference. So what have we learned from these years of federal, provincial, and municipal efforts to reduce energy consumption of Canada’s residential sector?

What are the barriers to change?
Identify major themes and obstacles, including jurisdictional, legal/economical, and behavioural challenges

What are some common themes?
Discuss common themes and possible integrated areas of intervention.


Program
- Overview of objectives and sustainable visions
- Some of the presenters and resource persons:
Hugh MacLeod, Associate Deputy Minister
to the Premier of Ontario: Climate Change
Peter Love, Chief Energy Conservation Officer,
Conservation Bureau, Ontario Power Authority
David Foster, Director of Environmental Affairs
Canadian Home Builders’ Association
Gordon Shields, Executive Director
Net-Zero Energy Home Coalition
Dana Silk, General Manager
Envirocentre, Ottawa
Also
- Preliminary results from the Telfer School research project
on barriers to innovation and change
- Recent case studies
- Breakout into groups and sharing of past experiences
- Synthesis and priorization of major barriers to innovation and change
- Next steps

To register, click here

For further information: makingithappen@telfer.uottawa.ca

Overcoming barriers: grading potential government measures

Our friends at the Sustainable Prosperity Project have just published a timely report to coincide with the various economic stimulus measures proposed by governments around the world, including our own in Ottawa. Their idea is to tie-in economic stimulus measures with environmental benefits.

The report, titled “Building a Green Economic Stimulus Package for Canada” ranks all kinds of proposed government measures and interventions according to three general tests (and nine different criteria), and then grade up to 23 different interventions and government measures.

The three general tests are:
1. Economic Test: How much economic stimulus will the measure provide to the economy?
2. Environment Test: How much improvement will the measure provide to the environment?
3. Policy Implementation Test: How easily can the measure be implemented throughout the country and how equitable are its impacts?

And the final grades for the 23 measures, following good academic procedures, are shown in the table below.

One can only hope that tomorrow's federal budget will get a passing grade.

Existing emission standards – another barrier to change

A key barrier to innovation and change are existing regulations. Changing regulations to lead to a sustainable society can be an uphill battle. The automotive industry in the US has been lobbying hard to avoid new regulations and standards for higher fuel efficiency and cleaner emissions, and had the support of former President George Bush. But this is about to change.

According to the New York Times today, President Obama will direct federal regulators on Monday to move swiftly on an application by California and 13 other states to set strict automobile emission and fuel efficiency standards, two administration officials said Sunday evening.

The directive makes good on an Obama campaign pledge and signifies a sharp reversal of Bush administration policy. Granting California and the other states the right to regulate tailpipe emissions would be one of the most emphatic actions Mr. Obama could take to quickly put his stamp on environmental policy.

Mr. Obama is expected to direct the Environmental Protection Agency to begin work immediately on granting California a waiver, under the Clean Air Act, which allows the state, a longtime leader in air quality matters, to set standards for automobile emissions stricter than the national rules.

This is likely to be the first of a many initiatives by the Obama admisitration on climate change. Stay tuned.

Barriers to innovation and change: lack of awareness

Anne Murray Choudhary has brought to our attention the following observation on the Ontario Power Authority (OPA). OPA has decided a few years ago that a kilowatt saved is much cheaper than paying for a new kilowatt of installed capacity, and has therefore embarked on an ambitious program to reduce electricity demand. A key challenge they face is to address the lack of consumer awareness, a major barrier to change:

The Conservation Bureau of Ontario, which spearheads OPA’s efforts to reduce electricity, conducted a market research study in 2007 in an effort to evaluate consumers' attitude towards energy conservation. The research objective was to "identify barriers to electricity conservation knowledge and action". The findings by the firm Environics show that --
• Energy (generally) and electricity (specifically) are not salient issues for most Ontario consumers
• There is public awareness of a supply/demand issue in the province, when prompted
• Cost of electricity is not a “hot-button” issue – except in the North
• Concerns emerge about environmental impacts of production and consumption, when prompted - but not the focus of public’s environmental concerns

The Conservation Bureau had also conducted a workshop in 2006 to gather intelligence on barriers from low-income housing residents. The workshop participants identified "Education and Communication", "Small Appliances and Lighting (efficiency)" and "Building Envelop and Systems" as key barriers. The Conservation Bureau's analysis also consists of specific mitigation plans for each barrier included in its workshop report.

So as part of its renewed efforts to educate consumers and communicate at the community level, the Conservation Bureau of Ontario, published in January 2nd, 2009 edition of the Kanata Kourier-Standard, a piece entitled "Conservation Zone" written by Peter Love, Chief Energy Conservation Officer of Ontario. Peter Love gives readers 10 easy steps to save money, and energy, in 2009 as a New Year's Resolution:

"1. Schedule a home energy audit. The auditor can tell you which home energy efficient changes are eligible for provincial and federal grants. Call 1-888-668-4636 and make an appointment today.

2. Install a programmable thermostat in your home. Every degree you drop reduces the heat costs by up to five per cent.

3. Change your furnace filter regularly - dirty filters make the fan work harder. Similarly, a clogged clothes dryer lint trap uses more energy and clothes take longer to dry.

4. Inspect exposed heating ducts and where you feel warm air leaks seal the ducts with special metallic tape. This keeps heat going where you want it.

5. Turn off the lights when you're not using them. Replace old, incandescent bulbs with compact fluorescent light (CFL) bulbs. CFLs use 75 per cent less electricity and lasts longer.

6. Participate in Energy Conservation Week (May 17-23, 2009) and World Wildlife Fund's Earth Hour on March 28, 2009.

7. Pull the plug on your old fridge and call the Great Refrigerator Roundup (1-877-797-9473). Older refrigerators can cost four times as much to run as a newer ENERGYSTAR model.

8. Buy cold-water soap for doing laundry. 85 to 90 per cent of energy used by washing machines goes towards heating the water.

9. Dryers alone account for six per cent of total household energy use in Ontario - use a drying rack indoors or an outdoor clothesline if possible.

10. Install weather stripping and caulking around windows and "sweeps" that seal the bottom of your outside doors. This can cut your heating bill by ten per cent."

Articles like the one in the Kanata Kourier-Standard can be found in many Ontario community papers and illustrate OPA’s continued efforts to increase consumer awareness of the benefits of energy conservation.

(Written by Anne Murray Choudhary, Telfer School of Management)

More on the importance of convenience

Here is another quick comment on inconvenience and barriers to innovation. Murray Hill of Saskatoon writes in today's Ottawa Citizen about a new device, Kill A Watt EZ from P3, that tells you precisely how much electricity your appliance uses and how much it will cost to run.

Having a simple display of how much energy you use at any given time is a very powerful tool to encourage energy conservation and behavior change. But the two barriers he notes are that “the display is it difficult to see unless you use an extension cord, and that it's difficult to find in stores.”

Barriers to innovation and change: the convenience of the right choice

Alain Martin of the Professional Development Institute shared with us how people make choices and change behaviour, and the importance of making sure that the desired change is as “convenient” as possible. He illustrated his point with the vivid example of increasing gasoline efficiency by having car tires properly inflated, and how the lack of convenience made this difficult for many people.

By all measures, one of the easiest ways to save 3-4% and even up to 8% of gasoline for cars and road transportation, is to have tires inflated at the right air pressure (See, for example, John Mahler’s article) But how easy is this to do? How convenient?

First of all let's look at the messaging and public awareness. If society were really serious about saving gasoline through the correct air tire pressure, then it would drive that message to you at every opportunity, just like wearing seat belts, or not drinking and driving. Each time you drive up to a gas station to fill up, you would be reminded to inflate your tires to the appropriate pressure. When you insert your credit card, you would be reminded again. And before you leave, you would be asked whether you did. As it is now, all you are asked whether you want to use air miles, have a car wash, or use any other kind of reward points or promotion. But there is nothing to remind us about air pressure. And it would cost nothing to add that reminder to the many other useless messages that bombard you each time you buy gas.

Moreover, getting the correct air pressure in your tires is not a trivial matter. It’s not easy or convenient. To start with, you need to find a gas station with a working air pump. By my estimate, only one in four or five gas stations in the Ottawa area would qualify. Last month I had to drive ten blocks before I could find a station on Carling and Maitland with a decent air pump. And I remember the manager telling me “Oh yes, they all love me for my pump. They come from all over just to inflate their tires.”

Then you need to measure the right pressure at a given temperature. Trying to decipher those tiny graduations on a pencil extendable gauge in the darkness of a winter evening is challenging at best. Getting an air tight contact between the gauge and the tire valve with your cold bare hands while scraping off the snow, ice and salt is definitely not fun. And the few air pumps that actually have a numerical readout are generally calibrated incorrectly. So if it reads 30 psi, it could mean anywhere from 27 to 32. All very inconvenient.

You can buy a digital air pressure gauge at Canadian Tire, but generally it's tricky to get an airtight seal with the tire valve so that the gauge can measure the pressure correctly. And who knows what the minimum wage gas station attendant will actually pump at your full service gas station. You’re lucky if they wash your windshield without leaving a streak.

To add insult to injury, some automated pumps will actually charge you $.25 or more to pump air into your tires with no indication whatsoever that the resulting air pressure will be correct.

Now if we are really serious about lowering gasoline consumption, it should be easy to keep our tires inflated at the right level all the time.

But it isn’t. So it’s not surprising that while 3 out of 4 Canadians wash their car every month, only one in seven will check their tire pressure in that same period. According to a recent survey of the Rubber Association of Canada, 70% of cars on the road were found to have incorrect pressure in their tires.

Imagine what ease and convenience might look like. Each time you buy gas, a green flashing reminds you to check your air pressure (in addition to reminding you about the inevitable car wash, air miles, etc.). Gas pumps are easily accessible, well-lit, with valves that fit properly, and easy readouts. Tire pressures are easy to check. And pumps are well-maintained and calibrated at all times. And it would probably cost only a few thousand dollars investment per station to have such pumps.

Let’s go further. Imagine that manufacturers now have dependable factory installed sensors inside your cars, with a warning light for over or under inflation. The built-in pressure gauge on your dashboard is as reliable as the speedometer or tachometer. As you pump the air, it pings when you reach the right pressure for the given road condition, outside temperature or type of driving you intend to do.

Now that would be convenient! And it would be so easy in such an environment to change behaviour.

But there signs of hope. US regulations require all cars below 10,000lbs to have systems that notify the driver if tire pressure drops more than 25% below the rated pressure. Europe is considering stronger measures as part of GHG emission reductions. And some luxury cars such as the Cadillac SRX have tire pressure monitors to the nearest psi (or so they claim).

We are finally moving in the right direction of convenience.

Barriers to Innovation and Change: The NRTEE report on Commercial Buildings Energy Efficiency

The National Round Table on the Environment and the Economy published today its long-awaited report on energy efficiency in the commercial sector.

Titled "Geared for Change" the report, which is the result of a partnership with Sustainable Technology Development Canada, presents a comprehensive analysis of the energy use of the commercial building sector Canada and its CO2 emissions, its fragmentation and complexity, as well as a particularly thorough analysis of barriers to the adoption of energy-efficient technologies in that sector.

In our ongoing quest to explore barriers to achieving sustainability, we reproduce in its entirety the summary of these barriers, which can be found in Table 4 on page 29 and 30 of the report:


Barriers to Energy Efficiency Technology Adoption in the Commercial Building Sector

Risk Management
• Market, technical, and financial risk
• Level of positive external/personal recognition for “doing the right thing” by installing the efficiency measure(s)
• Level of perceived risk that the efficient product may not perform as promised

Information Gaps
• Lack of complete data and information
• Lack of public understanding of infrastructure needs and resource constraints, i.e. the functionality, cost, drivers and challenges are unknown to the public
• Skills and labour shortage in the construction industry
• Lack of training resources (time, available education, funding) for building operators, inspectors, and trades
• Lack of interdisciplinary programs to promote integrated design processes between
universities and colleges
• Low awareness of available products and services
• Availability of installation and inspection services
• Low awareness of benefits: cost and co-benefit
• Required technical ability to assess the options
• Consumer preferences that do not value energy efficiency
• Existence of a viable infrastructure of trade allies

Value Chain and Principal-agent Relationship
• Level to which the incentives of the agent charged with purchasing the efficiency measures align with those of the person(s) that would benefit

First-mover Disadvantage
• Lack of enabling tools and techniques to facilitate market adoption of sustainable energy solutions
• Need to foster acceleration of advanced technologies
• Lack of performance monitoring of technology systems
• Access to appropriate financing
• Size of required energy efficiency investment vs. asset base
• Payback ratio – actual vs. required
• Level of effort/hassle required to become informed, select products, choose contractor(s), and install

Market Price Signals
• Energy pricing at levels that do not integrate externalities associated with the whole lifecycle (full-cost accounting)
• Energy pricing signals that do not reflect real-time costs

Institutional and Regulatory
• Codes, standards, and permitting processes that prohibit implementation of innovative energy efficiency technologies
• Constitutional jurisdiction for buildings includes all levels of government and results in different standards across the country
• Lack of long-term policy development due to short-term political agendas
• Limited horizontal cooperation/coordination to integrate policies and implementation
• Disconnect between longevity of infrastructure and short-term horizons on crucial decisions, such as budget allocations for maintenance and rehabilitation and rate structures
• Insurance industry acceptable practice, standards or levels of infrastructure service may lead to liability perceptions for professional designers, municipalities, developers

Barriers to innovation and change: Ontario Power Authority and "interval metering"

As part of our ongoing exploration of barriers to sustainability, here is an interesting snippet from the ongoing efforts of Ontario Power Authority. OPA has embarked on an ambitious effort of conservation and demand management to reduce the horrendous costs and environmental impacts of bringing on new generating capacity. In the process, they commissioned a number of studies on consumer behavior in the various client sectors. Here is one study that identified very clear barriers to energy conservation, targeted at clients that use "interval metering", or pay for their electricity consumption on an hourly basis at a variable price which fluctuates throughout the day according to supply and demand. Price ‘spikes’ can happen at any time during the day for a wide range of reasons. These clients tend to be larger commercial or industrial clients.

The theory goes that clients will schedule their operations to the time of day when there is a lower price, and avoid times with peak price. But in practice, as revealed in the course of the meeting in 2007 with interval meter customers, there are a number of real barriers to make this work properly. As the meeting notes show,

“...the barriers evolved into both ‘macro barriers’ and ‘micro barriers’:

Macro barriers: those broader issues that fall within the scope of policy makers, regulators and program administrators. Most interval meter customers find these barriers to be complex, confusing and beyond their ability to affect. They preferred to have the confidence that a ‘system’ is working efficiently on their behalf without requiring an understanding of the specific issues. This confidence would be achieved by ensuring that a transparent system is in place which would weigh the true costs and benefits of energy efficiency against supply options.
Micro barriers: those issues faced by customers at the facility level. These barriers exist as a result of “too few resources chasing too many projects” (resources were considered to include people and funding). Overcoming these barriers requires a range of solutions, including assistance from conservation and demand management (CDM) programs that are developed in response to their challenges i.e., incentives, tools, etc. and presented in the ‘customer language’ "

These barriers were specifically identified by "interval metering" customers, but in fact have elements that are much broader than that as we will see in our continued exploration.

Barriers to innovation and change: the “greening” of city of Toronto

Thank you to Stewart Elgie for pointing our attention to Moira Welsh’s December story in the Toronto Star on “Toronto’s green report card”

This story neatly illustrates not only some quantitative sustainable goals set by Toronto Mayor David Miller, but also evaluates the city’s performance on these goals, and in the process – which is highly pertinent to our study “Making it happen” - identifies a number of barriers to change.

Clean air: 30% lower GHGs by 2020 and 0 smog days
Barriers: budget cuts and delays, delays in approvals, planning and building,e.g. bike lanes.

Less waste: 70% waste diversion by 2010
Barriers: Collecting and processing organic waste and recycling it generates 20,000 tonnes of plastic bag containers. The capacity of the Toronto organic processing plants was exceeded requiring shipping to other facilities in Quebec which uses 1000 diesel fuelled trucks. New plants being considered will not have the capacity to process all organics, especially from apartment buildings.

Clean Water: “Blue flag” designation for Toronto’s 14 beaches (i.e. open 80% of time)
Barriers: need to further reduce burden on city sewers in “wet” years, and have targetted homes disconnect downspouts from sewer system to reduce sewage overflowing.

Setting sustainability and environmental targets (4): Masdar city in Abu Dhabi

Also in the December 6 2008 Economist is an up-date on the most ambitious sustainable project in the world today: Masdar city in Abu Dhabi.

In 2006 Abu Dhabi's development agency unveiled the Masdar Initiative, to pursue "solutions to some of mankind's most pressing issues: energy security, climate change and truly sustainable human development". The initiative consists of a research institute to develop environmental technologies, an investment arm to commercialise and deploy them, and an eco-city to house these two outfits and to serve as a test-bed for their ideas. All this, it is hoped, will turn Abu Dhabi into the Silicon Valley of clean technology, where green-minded academics, entrepreneurs and financiers will rub shoulders.

Some specs:

• Seed funding from Abu Dhabi: $15 billion
• Partners for the research institute: Massachusetts Institute of Technology
• Partners for commercialization: Credit suisse ($100 million), British Petroleum, Rio Tinto
• Anticipated population: 40,000 residents
• Strategic focus of technologies: no green house gases and no waste through next generation solar power, desalination, “personal rapid transit”. In fact, the city is expected to export 2% of its energy.

This is a refreshing change from other United Arab Emirate energy-guzzling mega-projects, such as the Dubai Ski resort built in 2005, the Abu Dhabi Formula 1 racetrack, or the proposed project to create an air contitioned beach in Dubai, as reported yesterday in the New York Times.

Barriers to innovation and change: wind power and the pace of technology development (2).

In its December 6 2008 “Technology Quarterly”, the Economist has a case study on the history of wind power and how far it’s come.

Technology deployment is never instantaneous. It takes time to improve the technology and it takes more time to deploy the technology.

As the authors say “The basic idea is ancient, but its modern incarnation adds many new high-tech twists”. Here are some highlights from the Economist article:

Improved technology and design
- Danish model with three-bladed horizontal-axis, upwind machine becomes broadly accepted in early 1980s, over vertical axis “egg beater” and two-blade horizontal axis models.
- Improved knowledge of impact of fluctuating winds (wind gusts) on turbine structure and gear boxes lead to variable pitch of blades, variable speeds and better control systems.
- Optimization of machines and weight reduction achieved through mathematical models – components become lighter, machines are scaled up.
- Move to larger “off-shore” ocean-based machines, e.g. 7.5MW. Total installed off-shore capacity expected to reach 8 GW by 2012.
- Efforts are ongoing to improve gear boxes, or eliminate them entirely with a “direct drive” system.
- At 50% efficiency – i.e. % of kinetic energy extracted from wind, today’s machines are coming close to maximum theoretical efficiency limit of 59%.

Increased capacity of wind machines
- In the 1980’s, after the first OPEC crisis, windfarms began sprouting in California, thanks to generous incentives.
- Rotor diameters were about 15 metres with production capacity in the tens of kilowatts.
- Today rotor diameters reach 100 meters, with capacity 30 to 50 times larger.

Lower Costs
Generating costs have dropped from 30 cents a kilowatt hour in the 1980s down to approximately 10 cents in 2007.

Exponential rate of technology deployment
In 2007, wind power produced 1% electricity globally, and is expected to reach 2.7% in 2012, and 6% by 2017.
In Europe, in 2007 wind contributed:
- 20% of Denmark’s electricity (the country has had an ambition R&D program since mid 1970s and is the world leader in the field),
- 10% for Spain, and
- 7% for Germany.
- In 2007, Germany accounted for almost one quarter (23.7%) of the world’s installed windpower; and
- the US was at 18%. By comparison, in the 1980s, California was the world leader and held 90% of the world’s installed wind capacity.
- China has been doubling its wind capacity every year since 2004.

Barriers to innovation and change
- Need for better transmission lines to integrate windpower into grid and capacity to absorb fluctuations
- Dependency on subsidies makes industry vulnerable to sudden cut-off (at least until some form of carbon tax is in place), e.g. abrupt halt of California’s industry when subsidies were cut in mid-1980s.
- NIMBY – resistance from consumers who don’t like the noise or cluttered horizon, and are worried about danger to birds.

These barriers are very siumilar to Margaret Wente's article last year (see our earlier Post)