Author/Contributor: Alberta Energy Efficiency Alliance, Dunsky Energy + Climate Advisors
This report explores financing options for high-efficiency new homes in Alberta, focusing on single-family homes. It aims to address the financial barriers preventing homeowners from purchasing these homes and build awareness among stakeholders. Through analysis and engagement with Albertan stakeholders, the following key trends were identified:
Market opportunity: Alberta constructs over 20,000 single-family homes annually. Building to higher energy performance standards offers significant potential for GHG reductions.
“If all new single-family houses in Alberta were built to Tier 3, the total (cumulative) emissions between 2025 and 2050 would be 7 MtCO2e lower than business-as-usual. Building to the highest Tier (5) would result in emission reductions of 42 MtCO2e (cumulative over 25 years).” – p. 19, Financing Solutions for High-Efficiency New Homes
Barriers to high-efficiency homes:
- Higher upfront costs for energy-efficient materials and equipment (e.g., heat pumps, improved insulation).
- Limited homeowner awareness about the benefits and available incentives for high-performance homes.
- A shortage of skilled labor and supply chain constraints inflate construction costs.
Proposed financing solutions:
- Property Assessed Clean Energy (PACE) financing – financing of energy upgrades by adding costs to property taxes, tied to the property, not the owner.
- Green mortgages – integrate the incremental cost of energy upgrades into the home mortgage, offering favourable terms (lower interest rates or longer amortization periods)
- Green personal loans – unsecured loans can give homeowners another option for financing energy upgrades, although terms are less favourable.
Stakeholders emphasized the importance of:
- Simplified, accessible financing programs.
- Competitive borrowing costs.
- Government support to mitigate risks and enable scalability.
Effective financing solutions can make high-efficiency homes accessible and reduce Alberta’s GHG emissions. Addressing barriers through education, workforce development, and policy changes is essential to unlocking these benefits.
Read the full report here.
