The Federation of Canadian Municipalities is currently funding municipalities to create residential energy efficiency programs. Through these programs, municipalities can support community members in upgrading their homes by adding insulation, air sealing, and solar power and converting from expensive greenhouse gas-intensive fuel sources like oil and propane to electrical cold-climate heat pumps.
Typically, these programs are centered around homeowner loans provided by the municipality to eligible community members. These loans are then paid back through the imposition of a local improvement charge on the participating property. Should the home be sold, the charge remains on the benefiting property.
Funding is available to create Feasibility Studies, Program Designs, and to capitalize programs once studies and designs are complete. Climate Action Partnership is available to assist our municipal partners through every step of CEF, from writing proposals, to completing the feasibility and design step, and then by administering programs once capitalized. The steps to participate in the program are described below.
Step 1. Feasibility Study
Through this phase, a baseline assessment of a community’s housing stock and energy upgrade potential is created. Building types and energy use profiles are assessed, and the potential uptake for energy efficiency and renewable energy is identified. This phase can be completed at no cost to the municipality by CAP using FCM funding. As CAP is the lead applicant, no procurement is required by the municipality.
Step 2. Program Design Study
This builds upon market intelligence and research identified in the feasibility study by advancing a program design that meets local community needs and municipal priorities, including energy poverty reduction, greenhouse gas reduction, housing stock improvement, and economic development. CAP can also support the municipality in completing this phase at no cost to the municipality and without municipal procurement.
Steps 1 and 2 can be completed concurrently and take approximately six months.
Step 3. Program Delivery
Once the Feasibility and Program Design Studies are completed, the municipality can apply for funding to capitalize and operate an energy efficiency retrofit program. Capital loans of up to $10 million are available. Loans are disbursed to homeowners and repaid through the property tax bill as a local improvement charge. As the loans are recoverable debt, they do not contribute to municipal debt limits. Up to 30% of the approved loan amount can be used for approved non-energy improvements (e.g., water conservation, climate adaptation, alternative energy) at the individual participating home.
Non-repayable grants are also available for up to 50% of the loan amounts ($5 million). Grants cover program start-up costs (e.g., legal services, procurement of IT tools, website development) and multi-year operating costs (e.g., staffing, marketing, incentives, and promotions)
The combined loan and grant can cover up to 80% of total eligible program costs, hence participating municipalities must contribute 20% of the total program loan amount (also lent to homeowners and repaid through local improvement charge applied to property tax bill).
For more information on these programs, please see https://greenmunicipalfund.ca/community-efficiency-financing or contact Kevin Behan at kbehan@climateactionpartnership.ca.
By Kevin Behan, Operations Director