This blog explores changes in the energy industry from an insider’s perspective as it transitions from the old centralized utility model to the new paradigm of distributed generation.
This blog was previously called Inside the Housing Evolution and focused on energy efficient homes. Ultimately, it’s all linked. Soon, every building will have the potential to generate, store, and sell energy. Welcome to the era of the transactive grid – the greatest shift the electricity sector has seen in over 100 years!

January 3, 2012 4 Comments

2012 – The Coming Apocalypse for Inefficient Homes

2012 promises to be a defining year for energy efficient housing in Ontario as the Ontario Building Code is being updated to include energy efficiency targets for the first time. In conjunction, the ENERGY STAR® program and the R-2000 program are also changing to make their energy efficiency targets significantly more stringent. With all these changes happening at once, it’s bound to be confusing for consumers. In this article, I’ll review the changes coming to these programs and explain what this means to anyone interested in purchasing a new home. All three of these programs rely heavily on the EnerGuide rating system to determine the efficiency level of the home, so we’ll start with that.

EnerGuide for Homes
The EnerGuide Rating is a measure of a home’s energy efficiency. It is calculated using the Hot2000 computer modelling program.  The computer simulation assumes standard lifestyle patterns and weather conditions so that different types and sizes of houses can be compared against each other.  An EG rating of 0 would represent the worst possible rating, a home with major air leakage and no insulation that requires a massive amount of energy to heat.  An EG rating of 100 would represent a Net-Zero Energy home, which produces as much energy as it consumes over the course of a year. A common misconception is that the EG rating shows a percentage of energy improvement (i.e. an EG 82 is 2% better than an EG 80), but this is not the case. Most new homes built to code in Ontario have an EG rating between 70 and 75. Currently, the ENERGY STAR® and R-2000 program each have an energy target of EG 80, which is generally considered to use about 30% less energy compared to a standard house.

In 2009, the Ontario government passed the Green Energy Act, which among other initiatives, allows the government to make it mandatory for every home in Ontario to receive an EnerGuide rating before it is sold. With this information purchasers will be able to compare the energy efficiency of homes in the same way we currently compare the fuel efficiency of vehicles. This program is currently in the development stage, but a major component will be the restructuring of the EG rating to make it more intuitive and easier to compare between homes.

Ontario Building Code
The Green Energy Act also changed the Ontario Building Code (OBC) to include energy use as a component of the code, and to give the province the ability to update the minimum energy criteria every three years. In 2012, the OBC will set EG 80 as the new minimum allowable energy efficiency rating for new homes. Although this is a fairly aggressive target for a minimum standard (30% more efficient than current building practices), builders across Ontario have already shown it is easily achievable at an incremental cost of approximately $4,000.

ENERGY STAR® for Homes
The ENERGY STAR® program is an energy efficiency certification program for homes that are third-party tested to achieve a minimum of EG 80. In 2012, ENERGY STAR® will update their standard to coincide with the increase in code efficiency levels.  The new ENERGY STAR® minimum target will be an EG 83, which represents a 25% improvement over EG 80.

R-2000 Standard
The R-2000 standard is similar to ENERGY STAR®, as it is a third-party verified labelling program for homes. However, it goes beyond energy efficiency to include indoor air quality and environmental responsibility. Since its inception, R-2000 has been supported by Natural Resources Canada as a “Best in Class” building standard.  In 2012, the R-2000 standard will be updated with a new minimum energy efficiency target of EG 86, or 50% better than EG 80.

The Transition Period
The OBC changes come into effect on January 1st, 2012. All new permits issued after that date must conform to the EG 80 minimum, however homes with permits issued before January 1st could still be built to the old standard.  The ENERGY STAR® and R-2000 programs will have grace periods to ease the transition into the new standards for builders. Under both programs, builders will be able to continue to market and sell to the old standard until July 2012. After this point, all homes sold as ENERGY STAR® or R-2000 must be built to the new standard.  With all this change, consumers interested in buying a new home have to be very careful to understand exactly what they are buying.  A new home marketed as ENERGY STAR® in early 2012 may be built to the exact same standard as a house built to code! It will be the purchaser’s responsibility to verify if the builder is marketing the old standard or the new standard.

What this means for Urbandale Construction
Urbandale has built homes reaching the EG 80 target for many years now, so the changes to the OBC will not affect us at all. We take pride in being at the forefront of energy efficient innovation, and to stay ahead of the curve we will also be changing our building spec in 2012. Urbandale is in the process of building a demonstration home following the new R-2000 standard. Actually, our demonstration home surpasses the standard and reached an EG 88.5! The goal of this project is to learn what is entailed with building to this standard and the associated costs. Although we have the knowledge and experience to build to the 2012 R-2000 standard, I’m concerned there are not enough purchasers that would be willing to pay the necessary additional up-front costs.  For this reason, our plan is to build to the 2012 ENERGY STAR® levels (EG 83) as our standard, and offer R-2000 (EG 86) as an upgrade option. And of course, the Urbandale version of ENERGY STAR® will go beyond the strict definition to include the important indoor air quality features already standard in all of our homes.

Posted by Matthew

4 Responses to "2012 – The Coming Apocalypse for Inefficient Homes"

  1. Ken Elsey says:

    Thanks Matthew! … if every builder in Canada had your commitment to building a better home we’d be one step closer to energy self sufficiency! Your customers likely don’t realize how lucky they are!

    Ken Elsey
    Canadian Energy Efficiency Alliance

  2. Matthew Sachs says:

    Thank you Ken! I find that our most difficult challenge is educating purchasers on the value of these upgrades.

  3. Valccro says:

    As an owner of an R2000 Home in Surrey, BC, it is good to see that we will be able to buy another home with greater savings that we already enjoy, both here and in Ontario. We’ll be waiting for more efficiency here in BC as well.

  4. Valccro says:

    Also, we hope to see builders taking on the responsiblity of Energy Saving Homes rather than just cosmetic features to sell homes, no matter where in the country.


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Matthew Sachs


  • COO of Peak Power since July 2016
  • General Manager of Urbandale Construction (May 2008 – Oct 2014)
  • Vice-Chair R-2000 Renewal Committee
  • Member of Energy Star Technical Advisory Committee
  • Greater Ottawa Homebuilders Green Committee
  • Recipient of Canadian Homebuilder’s Association 2009 R-2000 Builder of the Year Award
  • Participant in Natural Resources Canada’s Technology Roadmap for Sustainable Housing
  • Energy Consultant with Marbek Resource Consultants (Feb 2002 – May 2006)


Peak Power is a Microgrid project development company focused on delivering innovative solutions to offset the most expensive hours of electric demand. We specialize in optimizing the revenue streams from energy storage, advanced building automation, and renewable technologies for customer sited and utility scale projects. Please visit