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Emerging Energy Trends

It’s no secret that utility costs are steadily rising. To counter the inevitable, building owners are increasingly looking for ways to reduce their overall consumption while educating tenants to do the same. The first step towards achieving savings? Understanding what’s on your electricity bill.

Global Adjustment

Global adjustment is the difference between the spot price of electricity and the rates paid to various regulated and non-regulated generators across Ontario. This difference covers the costs for providing both adequate generating capacity and Conservation & Demand Management (CDM) programs, such as: non-utility generator contracts, regulated nuclear generation, Renewable Energy Standard Offer Programs (RESOP), Feed-In Tariff programs, Independent Electricity System contract adjustments and other programs.For many building owners, the global adjustment can be 30 to 60 percent of their total actual hydro bill, even though it is not based on monthly demand or consumption. In Ontario, it is actually determined by the IESO on random, spot measurements of your building in one year and then charged over the course of the next year in a calculated manner to recover the full amount. This means that saving energy in a given month doesn’t actually lessen the global adjustment charge for that month. It takes a prolonged, methodical process to drive down the global adjustment. As the IESO attempts to reduce carbon emissions through diverse programs that come at a cost, this will drive up the global adjustment charge. The only thing consumers can do is reduce consumption by implementing energy saving measures.

Carbon Taxes and "Cap-and-Trade"

A carbon tax is a tax based on greenhouse gas emissions (GHG) generated from burning fuels. It puts a price on each tonne of GHG emitted, sending a price signal that will, over time, elicit a powerful market response across the entire economy, reducing emissions as people adapt. Carbon taxes do not favour any one way of reducing emissions by means of reducing fuel consumption, increasing fuel efficiency, using cleaner fuels and adopting new technology, businesses and individuals can reduce the amount they pay in carbon tax, or even offset it altogether. A cap-and-trade mechanism allows carbon credits to be exchanged. Participants that emit more GHG than allowed will be required to acquire available credits from participants that have aggregated credits because they perform better than the established cap. Over the next six to 12 months, the federal and provincial governments will agree on a carbon tax or cap-and-trade system to promote reductions in GHGs in order to meet the Paris 2015 commitments. We are a ways away from implementations, but it is clear that carbon taxes and/or a cap-and-trade system are on the horizon. Whatever system is put in place, it will mean that energy savings will be more important than ever.

Lighting Retrofits: the New Low Hanging Fruit

LED bulbs have come a long way. They emit the same quality and colour of light as incandescent bulbs and they last far longer due to advanced technology. Customers have told us repeatedly that they have not changed a bulb in years, whereas previously a staff person would walk around weekly or monthly to change out burnt bulbs.

Things to Consider:

1. Operation hours: a light that is on 24/7 will have the biggest impact on energy savings

2. The warranty: look for 5+ years

3. Light quality

4. Bulb swap vs fixture replacement: what is better suited for your application?

5. DLC / EnergyStar: make sure they are certified by globally recognized accreditation systems to be eligible for incentives

6. ESA / CSA Compliant: it is illegal and unsafe to install LEDs without these certifications, and the market has been flooded with these products

The long and short of it is that an LED retrofit will save you energy and maintenance expenses, and should have been implemented yesterday—as a day using conventional lighting is a day that the hydro meter spins too fast.

The Strategy for Success

Make sure you have an up-to-date energy audit of your building. Incentives change every year and your energy audit will point the way to maximize the available government incentive programs. When you renovate your building, make sure you consider energy conservation as part of your retrofit goal – and you can dramatically reduce your energy consumption and operating costs every year. Your energy audit will recommend realistic targets for energy conservation and when you are ready to renovate, make sure you engage an energy conservation expert to review your design and assist with your incentive applications.

Did we mention that you need an up to date energy audit of your building?

With a passion for energy conservation, Per Polderman, CEIT, serves as a senior account manager at Mann Engineering Ltd. For close to 30 years the leading energy management company specializes in comprehensive energy audits, engineering reviews, HVAC design/build and retrofit needs. He can be reached at 416-550-3275 or via

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