Retrofitting Canada’s Buildings: A Long Game Worth Playing
A Conversation with Duncan Rowe of RJC Engineers
Canada is accelerating efforts to retrofit its existing building stock in pursuit of its 2050 net-zero targets. Yet public and industry sentiment towards retrofits remains mixed. Many building owners assume the process will be prohibitively expensive, requiring closures, tenant relocation and complex logistics that simply aren’t worth the disruption.
Duncan Rowe, Principal at RJC Engineers, says this assumption is one of the biggest myths holding the sector back. In reality, he argues, retrofitting is less a single disruptive event and more a structured, long-term process.
Retrofitting is a Journey, Not a Project
Rather than treating retrofits as one-time capital projects, Rowe explains that the approach they take at RJC is to treat retrofits as an ongoing process embedded in the culture of an organization. It requires phased plans, often spanning a decade or more, that aligns with the client’s milestones and funding availability. This is different from the typical understanding, where owners hear the word “full retrofit” and imagine shutting everything down and spending all their capital at once. Rowe clarifies that building retrofits cannot be a one-time, all-or-nothing undertaking.
When owners start seeing success from retrofit efforts, they themselves become advocates and they begin to teach their staff and reinforce the culture of sustainability. “That self-reinforcing positive feedback cycle starts to drive change at the industry level,” Rowe explains.
The Policy Gap
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Canada’s policy landscape for building performance is a work in progress, according to Rowe. It’s moving in the right direction, but it requires more effort to understand on-ground needs and realities.
The Canada Green Buildings Strategy (CGBS) was released in 2024 and prioritizes deep retrofits as one of the main strategic pillars for decarbonization of the building sector. It claims that Canada needs to accelerate retrofits of about 11 million buildings in the coming decades and achieve a retrofit rate of 3 percent per year.
Rowe is concerned that federal and provincial standards are often not designed to keep municipal contexts in mind and support ground-up transformation.
The Ontario Building Code (OBC) was updated in 2024 to harmonize with the national standards. However, there have been concerns about the code not meeting high standards of energy efficiency put forth in national standards. The National Building Code has a tiered approach to energy efficiency, and the OBC helps achieve 3 out of 4 tiers. However, it doesn’t provide a clear direction or path forward to support the industry to achieve greater energy efficiency standards.
Current building codes only provide a minimum benchmark of structural safety. They don’t guarantee low energy buildings. While the OBC shows slower progress, some municipalities like the City of Toronto have taken more tailored approaches to support energy efficiency in buildings. However, this results in more uneven progress across municipalities in the province.
While this is especially true in Ontario, Rowe lauds the British Columbia Energy Step Code for pioneering tighter energy efficiency standards with greater involvement from the industry. It provides energy performance requirements and enables developers to choose a step that aligns best with their project priorities. British Columbia also has a Zero Carbon Step Code for new buildings that requires buildings to exceed energy and carbon performance standards from previous codes.
Rowe believes that BC is the clear national leader in building decarbonization. as its policy landscape has enabled the industry to embed a culture of energy efficiency in practice. This aligns with Efficiency Canada’s 2024 Canadian Energy Efficiency Scorecard that ranks provinces and territories on a range of metrics related to energy efficiency policies and programs across buildings, transportation and industry sectors. BC secured the highest rank, with appreciation for the CleanBC 2030 Roadmap that has stringent goals for building decarbonization, such as 100 percent efficiency in space heating and water heating systems by 2030. The framework also works with homeowners to help them understand energy costs and carbon impacts.
Other provinces such as Quebec and Ontario also have some good policies, especially at a municipal level, but supportive policy frameworks at the provincial level are critical to augment impact.
Resilience Is a More Accessible and Relatable Message
While the word “retrofit” can throw people off, Rowe suggests drawing people’s attention by talking about resilience – it could be a more powerful framing than “sustainability” or “net-zero” when it comes to public and policy engagement. “Everyone experiences rain, floods and overheating events, and everyone worries about it.” he says. “Isn’t it nice if your home or office just works when there is an extreme event?”
The recent cold snap in Ontario made communities concerned about high heating bills, which wasn’t the case the past few winters. He explains that we need to be prepared for such variability in climate and ensure that our buildings continue to work when such extreme events happen.
Resilience isn’t just a communications strategy to convince people about energy efficiency, it actually reduces emissions. Buildings that are well-equipped to protect from heat waves, cold snaps and power disruptions tend to be well-designed with passive and energy-efficient systems. Resilience is an important priority laid down in the CGBS, and it refers to the National Adaptation Strategy as a framework to achieve strong and healthy infrastructure, both in existing as well as new construction.
In 2023 alone, extreme weather events resulted in $3.1 billion in insured damages. This makes a business case for deep retrofits. “99.9% of the time we have done resiliency stuff, it has actually reduced carbon either through operations or in the way we made the building resilient,” Rowe points out.
The Hardest Question to Answer Is, “Who Pays?”
Beyond government targets and the many benefits of retrofitting, it all boils down to the numbers. The problem may not entirely be a lack of interest, but rather a lack of willingness to pay. Retrofits remain expensive, especially low-income communities that are most vulnerable to extreme weather impacts. Rowe says that this is a chicken-and-egg problem, wherein the lack of demand results in lower competition, keeping costs high.
In 2024, the federal government pulled the plug on the Canada Greener Homes Grant, which provided homeowners up to $5,000 to implement energy efficiency upgrades in their homes. Last year, the Canada Greener Homes Loan program was also closed. This abrupt closure of successful programs was a cause for concern among homeowners who relied on the funding and had their applications waiting in the pipeline. The federal government announced a replacement in 2024, the Canada Greener Homes Affordability program that supports home retrofits for low- and median-income homeowners and renters at no cost. Manitoba became the first province to map out delivery of this program so far.
Along similar lines, the Canada Housing and Mortgage Corporation (CMHC) closed its affordable housing funding programs and is replaced by Build Canada Homes (BCH). This $13 billion investment in affordable housing focuses on modern, modular construction using prefabricated assemblies and local and sustainable materials like mass timber.
While appreciating the investment, Rowe is cautious about adding complexity. The BCH program has created confusion in the industry because it has forced practitioners to abandon tried-and-true processes like the CMHC funding and to start from scratch. He argues that while the BCH funding aims to support fast and modular construction, the time that developers would take to understand bureaucratic processes and requirements will ultimately delay the intended goal. His recommendation is to supercharge what works and remove redundant processes rather than inventing new, unfamiliar systems.
Rowe explains that the government’s role is not to pay for all retrofits but instead create enabling policies and incentives that build a market for retrofits. It needs to support greater competition and community buy-in that will results in cost reductions over time. He imagines innovative financial models that can help us sustain retrofit efforts such as the Toronto Community Housing Corporation, which spends around 25 percent of its budget on energy costs. With every retrofit project and resulting energy savings, they can invest the money saved into doing more retrofits or to redirect it towards programs and people who need it most.
The Formula to Retrofit
If you are wondering how retrofits actually work, Rowe offers a clear framework: reduce loads first, then right-size systems. In practice, that means starting with the building envelope, fixing air leaks, upgrading insulation, replacing windows. All those come before bringing in new mechanical systems like heat pumps.
However, while this formula works on paper, every building is different and every homeowner has a varied set of resources that they can work with.
For example, Rowe notes that while heat pumps are often the single biggest lever for cutting greenhouse gas emissions, they may not benefit some homes. Taking Ontario as an example, the grid is already relatively clean. Aging buildings can end up using more energy after a heat pump is installed because the system has to work harder to compensate for poor envelope performance. “In many cases, it is just about tightening up the building and being strategic about it,” he explains.
In Alberta, on the other hand, the grid is more carbon-intensive and maximizing total energy reduction matters more than fuel-switching. In BC, mild climate and cultural buy-in have made deeper retrofits more achievable. Retrofit strategies should keep these external factors in mind, he insists.
Is Canada Prepared for a Retrofit Economy?
Canada is facing a serious trades shortage as over 700,000 experienced workers are expected to retire between 2019-2028 and fewer young people enter the skilled trades. While this will impact the economy significantly, we need to imagine innovative ways to keep the ball rolling.
Rowe suggests we go modular by centralizing labour and bringing efficiency to repetitive work. By deploying newer onsite technologies, we can allow smaller crews to achieve greater output. He insists that workers need to be supported with apprenticeship programs and given better tools and technologies that they can leverage to do more.
This is within reach considering the AI revolution. Canadian companies are already exploring AI and robotics to automate tasks like reading blueprints and executing tasks. Workers need to begin adapting to this new normal and contribute in ways that support the construction industry to build more.
There are many interesting ways AI can support the construction industry. Rowe’s favourite possibility is for AI to support integrating fragmented knowledge, particularly through digital twins, which are virtual models of buildings that capture all kinds of information about them such as operational data, equipment histories and maintenance records. When a knowledgeable building operator retires, that institutional memory typically walks out the door with some scattered knowledge transfer. But AI-powered digital twins can preserve this wealth of information to make predictive analyses and cost-saving decisions.
Rowe feels optimistic about the future. “If every building in Toronto were just 80 percent better, it would solve the city’s carbon problem for the next 20 years,” he says. It’s a tough challenge, but unlike building from scratch, it doesn’t require starting over.
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