Study and design project for an energy transition program for Quebec communities

The Fédération québécoise des municipalités (Quebec Federation of Municipalities, or FQM) would like to conduct a design and market study to determine the feasibility and parameters of a financing program to accelerate the implementation of energy efficiency measures in the residential sector in Quebec. The program would provide financing that is tailored to the population’s needs and technical expertise in order to identify the measures to be implemented, in the form of a program managed by the FQM and offered to all Quebec municipalities. The proposed program is based on an innovative financing method that supports significant involvement from the private sector and seeks to raise the private capital required for the energy transition.

The proposed project is related to Quebec’s 2018-2023 Energy Transition, Innovation and Efficiency Master Plan. The master plan of Transition énergétique Québec (TEQ) includes the launch of a repayable financing offer that is tailored to the residential sector, in partnership with private or institutional investors.

The study will be carried out in two phases. The first phase, the market study, consists of assessing the number of dwellings that could benefit from the project and the number of municipalities that could participate in the program; assessing the potential size of the market for the project, with an analysis broken down by dwelling type; performing a preliminary assessment of economic, environmental and social impacts; analyzing competitive programs and competitors; and assessing the potential for the affordable housing market. The second phase, the program design, consists of confirming the program’s objective and founding principles; determining the management vehicle and method, including the human resources needed for the project’s implementation; developing the financing mechanism and defining the monetary flows; developing the operational structure, including contractual relationships between the various parties; ensuring the project’s complementarity or integration with existing programs; assessing the market share to be targeted; validating the program’s objective and financing structure; developing a collection process; assessing the legal and regulatory aspects; and analyzing the program’s accounting and legal compliance.

There are huge environmental benefits, including a reduction in greenhouse gas (GHG) emissions to enable municipalities to address their collective inventory, and decreased peak-time energy consumption by reducing electricity imports from markets that are dependent on fossil fuels. The economic benefits include: decreasing the financial burden for households through reduced energy spending, growing the tax base of municipalities, and freeing up clean energy that can be exported to surrounding markets. The social benefits include skill building for municipalities to increase their ability to take action for the improvement of the built environment; an improvement in occupant comfort levels and general health by allowing the creation of healthier environments; an improved brand image for the municipality; and the improvement of the energy resilience of communities by decreasing energy needs and the constraints placed on distribution systems and chains.

Innovative aspects

• The proposed study will develop an innovative mechanism for financing energy efficiency upgrades, and a regulatory framework for accelerating the implementation of energy efficiency measures in the residential sector within several municipalities in Quebec.
• The proposed project can help Quebec municipalities to implement their climate action plans, reduce the operational costs of homeowners, and improve the resilience of communities in the face of climate change.

Replicability

The results of the proposed study will provide a unique and innovative approach for municipalities in Quebec to accelerate the implementation of energy efficiency measures in the residential sector. The design of the proposed program could be replicated in whole or in part in several municipalities, in particular those facing technical and financial issues in implementing energy efficiency upgrades.