As temperatures head down to their seasonal norm, we’re turning up the heat at home. That means higher bills, but having an energy-efficient home can keep heating costs under control.
EnerQuality designs and operates five “green” building standards for the construction industry in Ontario. “These focus on the design and construction of the home,” says EnerQuality president Corey McBurney. “[We are concerned with] building a better home that requires less energy to perform and performs better. In practice, Energy Star for New Homes, which concerns itself exclusively with energy consumption, is by far the most popular [green home category]. We label over one in five new homes a year in Ontario and of those, 95% are Energy Star.”
Mortgage insurers Genworth and the Canada Mortgage and Housing Corporation (CMHC) offer incentives to borrowers who buy energy-efficient homes but who have less than a 25% down payment.
“A client that purchases a new-construction home that is EnerGuide rated 80 or above or an Energy Star home in Ontario, may receive a rebate of 10% of the [mortgage insurance] premium excluding taxes,” says Jason Neziol, vice-president of regional sales in Ontario for Genworth Financial Canada.
“If they decide to take a 30-year amortization instead of a 25-year, the client would typically pay 20 extra basis points,” Mr. Neziol says. “We will rebate that full amount to the [qualified] client when the house closes. If a client takes a $300,000 mortgage at 5% down and a 30-year amortization … they would receive $1,425 back.”
The benefits are also available to high-ratio borrowers who improve the energy efficiency of an existing home.
“The client can purchase a home and do renovations to increase its energy efficiency,” Mr. Neziol says. “They have to move the EnerGuide rating five points to a minimum of 40.”
With just 20% of new homes in Ontario attracting a green rating, energy-efficiency credentials are not, evidently, at the top of all buyers’ lists.
“A lot of people look at what they can do that won’t cost a lot of money and afford a quick pay-back,’” says Gary Siegle, regional manager of Invis, Alberta South and Saskatchewan. “The green mortgage rebate is a sweetener to get you there, but it is not a quick payback” on the full cost of the renovations.
Beginning Jan. 1, Ontario will have one of the most rigorous building codes in North America: “With Energy Star, we are taking an already fairly high baseline and making it that much more efficient,” Mr. McBurney says. “Usually about 25% more efficient.”
Green-certified buildings that meet a higher standard and provide longer-term savings attract consumers, Mr. McBurney says, but acknowledges that North American’s relatively low energy costs make it less of a priority for some.
“The reality is I pay more to operate my BlackBerry on a monthly basis than I do to heat my home in the middle of winter,” he says. “As long as energy prices in Canada remain as low as they are, people are likely to continue on with their busy lives rather than make energy efficiency in their homes a priority.”