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CAPREIT marks 6% GHG cut in Canadian portfolio from 2022 to 2023

Made almost $30-million investment into retrofits and electrification in 2023

CAPREIT's Parque on Park has solar panels installed, embodying part of the rental housing company's sustainability strategy. (Courtesy Canadian Apartment Properties Real Estate Investment Trust)

Investments into energy efficiency and resiliency are driving Canadian Apartment Properties Real Estate Investment Trust’s (CAPREIT) environmental initiatives, the Toronto-based rental housing company announced in its 2023 ESG report.

The trust spent almost $30 million to replace older building equipment such as boilers and chillers, helping to cut like-for-like energy use intensity and greenhouse gas (GHG) intensity by 1.5 per cent from 2022 to 2023.

CAPREIT (CAR-UN-T) has a unique challenge among its peers in reducing its climate impact, as most of its portfolio is rental housing, senior vice-president of corporate affairs Larry Greer told Sustainable Biz Canada.

“The vast majority of (rental apartment) buildings in Canada are quite old. I think roughly three-quarters of our portfolio is legacy buildings. Those tend to be less energy efficient and more capital intensive than new ones.”

Viewing the latest results as good progress, but acknowledging more has to be done, CAPREIT plans to invest more into retrofits and sustainability, Greer said, helped by a $70-million loan from the Canada Infrastructure Bank (CIB).

As of Dec. 31, 2023, CAPREIT owned over 57,000 apartment suites, townhomes and manufactured home communities (a portfolio the company is selling) in Canada. It also holds some commercial and retail space.

Tackling energy efficiency

Energy efficiency is where CAPREIT has invested a substantial amount, including in heat pumps, heat recovery systems, chillers and HVAC systems. An approximate $10-million boost on energy and resiliency spending was made from 2022 to 2023.

At Westpark Village in Toronto, the company finished its first renewable energy project in 2023 by installing solar panels. The sun now powers the community’s lights, hot water systems, elevators and heating systems, with spare energy sent to Ontario’s electric grid. It also acquired Parque on Park in Langley, B.C. which has solar panels installed.

Additionally, 52 electric vehicle chargers have been installed at 26 CAPREIT properties.

The like-for-like energy use intensity was achieved by its upgrades and a milder winter that reduced heating fuel demand.

Absolute energy use intensity per suite was cut by 6.1 per cent from 2022 to 2023, and CAPREIT’s absolute energy consumption was reduced by 5.7 per cent in the same period. Its capital recycling strategy — where CAPREIT buys newer, more efficient buildings than the older buildings it is selling — drove the absolute figures, the company noted.

Since 2019, CAPREIT has reduced overall GHG emissions by 10.2 per cent. The Canadian portfolio saw absolute GHG emissions fall from 120,068 tonnes of carbon dioxide equivalent (tCO2e) in 2022 to 113,292 tCO2e in 2023 — a six per cent decline.

Other than the hardware, Greer noted the importance of software in tackling the company’s pollution. CAPREIT uses building automation software to monitor the energy consumption and GHG emissions of its buildings and discover maintenance issues, enabling it to react to problems such as leakages.

A significant boost to its efforts is the CIB loan that supports retrofits for 60 multiresidential buildings.

CAPREIT’s $70-million CIB loan

Announced in May, the financing and upgrades will have an impact for residents living in approximately 14,000 suites. 

“This loan will enable us to proceed with retrofitting approximately one-third of our existing Canadian apartment portfolio, which will significantly reduce its carbon emissions annually,” Mark Kenney, the president and CEO of CAPREIT, said in a release.

A 40 per cent reduction in GHG emissions per year from the impacted buildings is expected. Upgrades include heat recovery in mechanical systems, electric heat pumps, building automation systems, lighting retrofits and sub-metering.

“It helps a lot,” Greer said. “It’s a big program for us on a GHG emissions basis.”

CAPREIT’s 2023 emissions and goals

In 2023, CAPREIT’s portfolio emitted 90,116 tCO2e of absolute Scope 1 emissions, 19,578 tCO2e of absolute Scope 2 emissions and 3,598 tCO2e of the absolute Scope 3 emissions categories it calculates.

A big proportion of CAPREIT’s Scope 3 emissions are not captured from its sub-metered apartments, Greer explained. Approximately three-fourths of its suites are sub-metered for electricity, meaning CAPREIT has no “visibility into the consumption and GHGs emissions data on each of those units.”

But sub-metering means residents can improve energy and water consumption, and reduce GHG emissions because they have more visibility into their activities, he added.

While CAPREIT has not set any high-level climate targets yet, the company is looking to refresh its ESG strategy in 2024, Greer said. Due to CAPREIT’s ever-changing portfolio, setting firm targets is a challenge, he explained.

CAPREIT’s climate strategy will continue to revolve around retrofits, electric vehicle charging and solar energy integration, along with considering sustainability in its investments, capital planning and operations, Greer summarized.



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