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Efficiency Capital adds provincial partners for deep-carbon retrofits

Company operates in Nova Scotia, Alberta, Quebec

IMAGE: Grandravine condo, North York
The Grandravine condo on 3690 Keele St., North York, Toronto, where EC undertook one of its retrofitting projects. (Courtesy Efficiency Capital)

Energy-as-a-service company Efficiency Capital (EC) has partnered with Dartmouth, N.S.-based EfficiencyOne to provide funding to building owners for energy efficiency and net-zero retrofits.

EC also recently partnered with environmental charity, the Alberta Ecotrust Foundation, to help fund retrofits in Calgary and Edmonton for multiresidential buildings.

EfficiencyOne operates in Nova Scotia as Efficiency Nova Scotia. The company states it has achieved more than $4 billion in energy savings, including over $400 million for low-income homeowners and renters, and contributed 22 per cent of Nova Scotia’s overall greenhouse gas emission reductions.

“We see EfficiencyOne as a very different player out there in the market. Because while there are a lot of people promoting this concept of energy efficiency and ability, it doesn't exist anywhere in the country other than with Efficiency Nova Scotia,” Chandra Ramadurai, EC’s CEO, told SustainableBiz.

“So they are different, they are based on deep relationships with customers. That is a very (good) thing for us too. Because a lot of what we do is all about trust.”

Nova Scotia has a goal of reducing greenhouse gas emissions by 53 per cent below 2005 levels by 2030, and reaching net-zero by 2050.

Incubated by the Atmospheric Fund in 2015, EC supervises the engineering, investment, installation and monitoring of energy upgrade projects. It earns back its capital and professional services investment by sharing the clients’ utility cost savings. It has over $100 million in project funding for its decarbonization solutions.

Efficiency Capital and EfficiencyOne

EfficiencyOne first became aware of EC about a year-and-a-half ago, and the companies had been formally discussing a partnership since Q4 2022.

Ramadurai estimates the Canadian market needs approximately $30 billion worth of retrofits. Assuming Nova Scotia represents roughly 10 per cent of that market, he sees the companies looking at a $3 billion gap.

EC itself has a goal of deploying $1 billion of retrofits across Canada.

“(There’s) no particular timeline deck, but we do see this as a long-term relationship. We believe there are significant projects that can be unlocked through this financing, and so the scale of it is somewhat unlimited,” Stephen MacDonald, EfficiencyOne’s president and CEO, explained.

“But of course, there are constraints around the amount of capital that can be brought to the table. I think this is something I'm looking forward to developing over time.”

With this partnership, there are no constraints on the type of buildings that might be funded. What does get retrofitted comes down to three major factors.

“The first is capital, and the second is the risk management piece, and the third one is capacity. One of the biggest stumbling blocks for a lot of these products is capital and capacity,” Ramadurai said, noting the firm will collaborate and partner with local organizations for each project. “We take the risk in our books, as we know these particular projects, but at the same time, we also work with a lot of local partners who are already existing and automatic. They have knowledge.

"We don't try and reinvent."

The technologies involved depend on the needs of the building. MacDonald mentioned more demand for heat pumps, but also singled out more traditional measures like insulation and windows. Ramadurai, meanwhile, explained that EC is focused on electricity optimization, gas and water.

“As the year progresses, and we get the word out even further, we can look at how we can scale this even further,” MacDonald said. “It's a relatively small market. and once the word gets out . . . that'll generate a lot of buyers in and of itself.”

Efficiency Capital’s funding

In the west, the Alberta Ecotrust received a $43.4 million endowment from the federal government to create the Climate Innovation Fund, so between that and EC’s platform there is over $140 million to deploy into investments.

The first project, two Edmonton buildings with 165 units combined, is already in development.

“This model works great because Efficiency Capital manages the process, provides access to the capital and provides assurances with its partners that the cost savings and emissions reductions will be achieved,” Phillipp Binder, the project’s director of operations, said in a statement.

According to a release, approximately 30 per cent of greenhouse gas emissions in Calgary, and 20 per cent in Edmonton, come from residential buildings.

In May, EC also partnered with the Greater Montreal Climate Fund to create the MultiRés program, targeting funding for mid-size buildings in the 82 municipalities of Greater Montreal.

“All these local partners, they bring the trust . . . after years of working with local brands,” Ramadurai said. “And that particular thing is what accelerates the whole process.

"That's what we are looking at through these partnerships.”

Looking ahead, Ramadurai said other partnerships are in the works and the company hopes to make a further announcement (or announcements) in the fall.

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