In a surprising move, Vancouver City Council has approved a directive for City of Vancouver staff to restore the ability to enable the option for new home construction to use natural gas for heating and hot water.
The directive passed in a 6-5 vote Tuesday evening during the City Council’s discussions on the municipal government’s next climate plan, revealing a rare split among ABC Vancouver party members in their decision. ABC councillors Lisa Dominato and Peter Meiszner joined Green councillors Adriane Carr and Pete Fry and OneCity councillor Christine Boyle in opposition.
Since January 2022, the City of Vancouver has required low-emission (electric) equipment for space and hot water heating in new low-rise residential buildings, including the new Missing Middle Housing policy of enabling low-density multi-family homes on single-family lots. This builds on other policies implemented over the past 15 years to transition away from natural gas in other types of new and existing buildings, including requiring the installation of electric equipment for certain types of renovations.
Following the approval of the new directive, City staff will prepare the necessary bylaw amendments for City Council’s consideration by no later than November 1, 2024.
The amendment was proposed by ABC councillor Brian Montague, who argued that there is a need to diversify energy sources to enhance resilience and reliability in the event of outages, such as those caused by wind storms, in contrast to the current accelerated strategy of transitioning solely to electricity.
“Further to the energy resiliency argument, when the power grid fails because of climate issues, flooding, winter storms, moments of crisis or natural disasters, we continue to focus on a single energy source,” said Montague during the meeting.
He asserted that BC Hydro is struggling to keep up with electricity demand from not only population and economic growth, but also the push by the provincial and municipal governments to accelerate the transition towards electrification for building heating systems and vehicular transportation.
In 2023, driven by these same reasons, BC Hydro announced it will buy 3,100 gigawatt hours (GWh) of additional electricity each year starting in the late 2020s. This need to buy more power is much sooner than previously anticipated, and the amount is equivalent to about 60% of the capacity of the new Site C hydroelectric dam, which is expected to reach completion next year. BC Hydro’s updated forecast already includes the anticipated major capacity increase from the operation of Site C starting in 2025.
Furthermore, according to the electric utility, about 90% of BC Hydro’s electricity comes from hydroelectricity, which relies on a healthy wintertime snowpack accumulation. But recent droughts have significantly reduced the snowpack, with the electricity utility importing 20% of BC’s electricity last year, including a significant portion from coal and natural gas sources.
Montague also believes providing builders and homeowners with options for how their energy source needs are fulfilled will improve housing affordability and living costs.
“People want to have the ability to choose how they heat their food, how they heat their spaces, and how they heat their water, but they also want the ability to have a choice around how much they’ll have to spend to do that… Our current policy, again, while well intentioned, I think, is causing significant increase in everyday living costs for people, many of those costs will be passed directly to or will trickle down to seniors, renters and those who can least afford them,” said Montague.
“I think it has been made very clear that limiting energy options is a significant barrier to creating more housing, especially much needed missing middle and multiplex housing, because the costs are being driven way too high, higher to construct, higher to operate. And I believe this amendment will reduce that barrier next year.”
ABC councillor Mike Klassen also elaborated that the development industry has particularly expressed issues with pursuing the Missing Middle Housing policy’s building forms of up to eight units on a single-family lot due to the significant cost of electrical infrastructure upgrades.
When asked to weigh in during the meeting, City of Vancouver director of sustainability Brad Badelt said such a move would “move us further away from our climate outcomes” and suggested that it would “cause some confusion in the industry.” He also stated that while the upfront cost of building low-emission homes is higher, it does not necessarily impact the market price, when asked to provide a picture on the cost impact to consumers.
Green councillor Pete Fry contested Montague’s claims, asserting “misinformation” and that BC also exports a significant amount of electricity as part of a wider western continental grid that stretches as far east Alberta and as far south as California.
“If we’re looking for cheap energy sources, I hear that oil is actually a lot cheaper than than natural gas. So if we really want to go for cheap we could go to oil, oil tanks and heat with oil, but we know that it’s moving backwards as far as our climate objectives. It’s moving backwards as far as environment health,” said Fry.
Green councillor Adriane Carr added, “I’m going to speak against this amendment. I think it’s absolutely well, I should just hold my tongue, it’s the wrong direction. It will take us backwards at a time when the industry and when the public is moving forward, and when the provincial government and BC Hydro, the major supplier of energy, is moving in a unified way towards especially for new builds and making sure that we don’t put gas and oil and especially, or sorry, gas, and especially for hot water and heating.”
Immediately after the decision, it was noted that the move to reenable the use of natural gas for more energy needs in new home construction is supported by organizations such as the Homebuilders Association of Vancouver (HAVAN) and the Greater Vancouver Board of Trade.
“This bold move by Vancouver City Council is a game-changer for our homebuilders,” said Wendy McNeil, acting CEO of HAVAN, in a statement on Tuesday evening.
“Providing options for all housing types is essential for our city’s future as we need more tools to make it more affordable for residents. By expanding energy options for heating, City Council is empowering our members to build more housing faster while paving the way for more attainable housing solutions.”
The City of Vancouver had previously gone so far as to consider banning the use of natural gas for cooking in new homes, eliciting deep concerns from the restaurant industry on multiple occasions that such a policy could eventually be expanded to businesses. But so far, the policies go as far as to curb the energy sources for heating, not cooking.
Previous City administrations led by Vision Vancouver, which initiated the municipal government’s aggressive approach toward lowering building emissions, also publicly clashed with the natural gas utility FortisBC.
The BC NDP provincial government is also in the midst of considering new policies that could expand low-emission building construction, specifically a ban by 2030 on the sale of conventional gas water heaters and boilers for residential, commercial, and institutional buildings.