Toronto can reduce building emissions while protecting tenants – here's how

By the end of the year, Toronto will be the second city in Canada to have emission reduction rules for new and old buildings. If designed correctly, experts say the rules could be an important step toward the city’s climate targets while avoiding rent hikes for tenants.   

Called building emission performance standards, the regulations set mandatory emission targets for buildings — which produce 18 per cent of Canada’s total emissions and 60 per cent of Toronto’s — that become more stringent over time. All buildings equipped with fossil-fuel-based heating and cooling systems and appliances emit planet-warming greenhouse gas emissions. 

Older buildings tend to be particularly problematic because they are less efficient at retaining heat and energy. There are a slew of upgrades that building owners can put in place to improve efficiency and reduce pollution, but too often, the improvement costs are passed down to tenants. Tenant rights advocates in Ontario are determined to make sure that doesn’t happen when the new rules kick in.   

In the fall, the city of Toronto is set to pass mandatory emissions standards for all medium and large buildings, making it the first city in Canada to address emissions from both residential and commercial buildings. A 2024 report released by Efficiency Canada notes existing voluntary measures used by individuals and some municipalities to reduce emissions from buildings in Canada haven’t been effective enough — building emissions have gone up by about three per cent since 2005.

The standards, adopted in a handful of cities in the United States and Vancouver, don’t prescribe the precise steps building owners must take to cut emissions, explained Bryan Purcell, vice president of policy and programs at The Atmospheric Fund. However, heat and hot water systems use the most energy and expel the lion's share of emissions — making them two key target areas.

“That could be replacing gas-fired equipment with a heat pump…it might be going to a more efficient gas-fired piece of equipment in the initial stages,” Purcell explained. Many hot water and heating systems are reaching the end of their lives and shouldn’t be swapped out for another polluting piece of equipment, he added.

“There are other things people can do to reduce their heating and hot water energy use: better controls and automation on building systems, better windows and insulation, simple things like low-flow shower heads, which will reduce hot water usage. There are a variety of tools, but what we're really driving towards…is reducing heat and hot-water-related energies.”

Toronto will be following Vancouver, which has adopted a building performance standard program, but only requires commercial office and retail buildings over 100,000 square feet to comply with carbon emission limits as of 2026. However, the city has other requirements around building efficiency for replacing hot water heaters in homes, for example. 

Cities across the U.S., such as Boston, New York and Seattle, have standards in place that include residential buildings. Now, Toronto is following suit. Including medium and large residential buildings is important not only to cut emissions, but also to improve the livability of homes for renters, explained Purcell. 

Making apartment buildings more energy efficient makes them more livable: heat pumps act as heaters in the winter and air conditioners in the summer; improving a building envelope means less heat gets out and in. More efficient buildings mean lower energy bills. 

“When you're improving the climate and the living conditions of a residential unit, it can only improve the lives of tenants,” notes Douglas Kwan, director of advocacy and legal services at the Advocacy Centre for Tenants Ontario (ACTA)

He points to British Columbia’s 2021 heat dome, when over 600 people died due to extreme heat impacts, the majority of whom were at home. However, there are concerns about landlords using upgrades that reduce emissions to justify kicking renters out of their units or to hike rental costs.

In Ontario, units occupied before November 2018 are protected under rent control, but there is wiggle room for landlords to hike rents through above guideline rental increases. While the increases have to be approved by the tenancy board, landlords can apply to increase rents for a slew of reasons, including finishing “major capital work,” or if conservation funding programs have been used to install upgrades, such as low-energy lights and low-flow toilets.

Newer buildings will likely meet the efficiency standards, especially during early phases. Older buildings, which are typically home to low- and middle-income renters, are the primary concern for tenancy advocates, explained Kwan. Ultimately, the standards should benefit both renters and landlords improving their assets through upgrades. 

ACTA and other organizations are lobbying the city to stress how negative repercussions of the standards can be avoided. In response to Canada’s National Observer, the city of Toronto said it has “provisions in place in all our financing programs that prohibit property-owners who have received funding or financing from the City from using the related projects to apply for above-guideline rent increases.”

The city, which has a target of reaching net zero by 2040, noted that one of the key design principles for the standards “is ensuring equity and affordability are considered, and we are making space for potentially impacted communities to be a part of those equity discussions in our policy development process.”

How to measure emissions in buildings

Toronto following the lead of other North American cities means there is already a tried-and-true way to measure emissions from buildings, explained Purcell. The U.S. government developed the ENERGY STAR portfolio manager tool, which is licensed by the Canadian government and is free to all Canadian building operators. 

“It has a standardized way [of] measuring energy use and emissions, so that everyone's doing it the same way and accounting for weather, because weather year to year has a big impact on energy use,” Purcell explained. 

“Heating is the biggest use of energy in buildings, and the software automatically accounts for that. If we have a colder or warmer year, it normalizes for that in a standardized way. So, it provides a really good way of ensuring everyone's using the same kind of yardstick to measure their emissions.”