Logo - Business Development Bank of Canada - BDC
Building management Article | 8-minute read

A practical guide to retrofitting your building for energy efficiency

Upgrade your building to save money and reduce your climate impact
Worker walking on building roof

Retrofitting your building will make it more energy efficient, lower your energy bill and also help create a more pleasant interior environment for your employees.

An energy retrofit for your building will also help in the fight against climate change by reducing your greenhouse gas (GHG) emissions. Residential, commercial and institutional buildings accounted for around 13% of Canada’s GHG emissions in 2020, making them the third-largest contributor after the oil and gas and transportation sectors.

Building technologies are advancing all the time, which means that just about any existing building can benefit from upgrades that will reduce energy consumption, cut emissions and save you money over time.

Start your building retrofit with an energy audit

To determine where you can have the greatest impact, you first need to understand where your building’s energy is going. That’s why a comprehensive energy audit is a great place to start.

While you can do some of the steps yourself, it usually pays to hire an energy consultant who is trained to identify areas for improvement and help you plan your retrofit.

“A good energy audit will make tailored recommendations based on the unique characteristics of your building and how you use it,” says Bruce Taylor, President of Enviro-Stewards Inc., an environmental consulting firm in Elmira, Ontario. “That’s better than cookie-cutter advice that may or may not be appropriate to your situation.”

Steps in an energy audit

1. Analyze your utility bills—An early step will be an examination of your utility bills from the last two years to get a baseline reading on your energy use and identify trends.

2. Evaluate your operations—Your consultant should spend time getting to know your operations, identifying patterns in energy use and looking for opportunities for savings. This should include visits after hours to study building systems and equipment when no one is around.

These types of walkabouts can often uncover unnecessary energy use, such as HVAC schedules that were extended temporarily and then never reset, or lights and other equipment left on all night.

3. Test for air tightness—Your consultant can conduct specialized tests to identify areas where heated or cooled air is escaping from your building. These might involve pressurization tests of the whole building and/or smoke pencils or infrared cameras to identify drafts.

4. Assess your HVAC systems—Inefficient HVAC systems can be a source of major energy loss for your company. Your consultant should evaluate their efficiency and make recommendations about upgrades.

Once this work is complete, your energy consultant will produce a report and help you decide on goals for retrofitting your building. From there, you can make a plan, including how to finance larger projects.

“There are lots of programs and incentives from governments and utilities,” says Miguel Sousa, President of environmental engineering firm Ambioner in Quebec City. “An energy consultant can help you navigate it all so you can secure the financing you need.”

For best results, look at your whole building

While it might be tempting to focus on your most energy-intensive system (usually HVAC) and replace it, both Sousa and Taylor recommend a staged, system-wide approach.

This kind of approach recognizes that each system has an impact on how other systems function. For example, a new water heater may be more efficient than the one it’s replacing. But you might reap much greater gains with a system that uses waste heat recovered from equipment like refrigerators to heat water.

A staged approach to retrofits will allow you to achieve quick, inexpensive wins to save money that can then fund larger retrofits.

Cost-effective upgrades as part of a building retrofit

  • Improve your lighting—If you’re not already using LED lights, start by making that switch, Taylor says. “And don’t forget about your exit, emergency and exterior lighting.” Once you’ve switched to LEDs, the next step is to make sure they’re on only when they need to be. Add motion or presence sensors that will turn lights off when no one is around. And take advantage of natural lighting by using light level sensors to adjust interior lighting based on available sunlight.
  • Adjust your HVAC settings—Make sure your temperature controls are aligned with when people are in the building, and adjust settings based on the comfort needs of building occupants. “People who sit at a desk all day may not actually need as much cooling in the summer as you think, especially if you can adjust the humidity levels,” Sousa says.
  • Maintain and repair your HVAC system—Old and malfunctioning components will reduce the effectiveness of your system. Ensure ducts are clean, dampers are operating correctly, fan blades aren’t stuck and any other necessary improvements are made.
  • Insulate pipes—The larger your building, the more heat you will lose as hot water moves to the point of use. Proper pipe insulation will reduce heat loss and might even allow you to lower your water heater’s temperature set point.
  • Turn equipment off—From computers to heavy machinery, any equipment left running when it’s not needed is using energy unnecessarily. Introduce policies requiring equipment to be turned off at the end of the day or shift.
  • Choose energy-efficient equipment—When replacing equipment, look for Energy Star certification where possible. This certification guarantees a product is among the most efficient in its class.

Improve the building envelope

After you’ve made these upgrades, look for ways to improve the building’s envelope—its walls, roof, windows and doors. If your energy audit revealed any leaks, seal those as soon as possible. This might involve caulking windows, replacing weather stripping around doors and windows or repairing exterior cladding.

Some envelope upgrades will be more expensive and disruptive to building occupants. A good time to do them is when you have to replace components or you’re switching tenants. For example, you might:

  • Add insulation—Any time you’re opening up the walls or the roof, take the opportunity to add or upgrade insulation.
  • Choose efficient windows and doors—Modern windows and doors offer innovative features, such as less conductive materials, more insulating gas fills between panes and better seals.
  • Consider a cool roof or blue roof—Cool roofs use lighter coloured materials to reflect more sunlight away from the building, while blue roofs use collected rainwater to help cool the building.

Upgrade your HVAC system

After you’ve made your building as energy efficient as possible, it’s time to look into replacing your HVAC system.

In many cases, your previous upgrades will have significantly reduced the demands on your system or enabled it to run more efficiently. As a result, you might be able to replace your existing units with smaller ones, which will use even less energy.

When shopping for your new HVAC system, be sure to consider the total cost of ownership, rather than focusing exclusively on the initial price tag.

“Although efficiency may come with a price premium,” says Taylor, “it will often more than make up for it over the long term, costing less to run and producing fewer emissions.”

Higher-end systems will often be more durable, so you won’t have to replace them as soon. This is better for your bottom line as well as your carbon footprint because it avoids the costs and emissions associated with the disposal of old units and the manufacture and transportation of new ones.

Tips for business owners who are tenants

When you don’t own the building, it’s more challenging to plan and execute a retrofit—but it’s not impossible.

First and foremost, says Taylor, it never hurts to ask. Prepare the same kind of business case you would if you were making the decision to retrofit your own building and present it to your landlord.

This can be especially effective if you tie it to improvements your landlord already intends to make. For example, if you know the landlord plans to replace the windows, make the case for upgrading to the most energy-efficient option.

If you’re in a position to do so, you can offer to finance upgrades yourself. “It’s a great deal for the landlord,” says Sousa. “It can significantly increase the value of their building, without having to make a major investment.”

Sousa says his own company’s landlord was so thrilled with upgrades the company made to his building that he actively marketed them to other potential tenants. That helped him secure a major new tenant for a previously vacant space.

If you can’t get your landlord on board, you can consider moving when your lease is up. Look for a space with your desired features, and talk to prospective new landlords to gauge their openness to future energy-efficient retrofits.

Continuously monitor your building’s performance

Just as it’s important to assess your building before you start, you need to keep measuring its energy efficiency, especially after major upgrades. This allows you to quantify your gains and support the business case for further improvements.

Be sure to publicize your success, both internally to your building occupants and externally. Your commitment to the environment can help you attract new employees and business and be an effective way to convince others to save energy and reduce emissions from their own buildings.

Consider building certification

If you really want to showcase your performance, you can assess your building against industry standards or even pursue a certification such as LEED, the most widely used green-building standard in Canada and globally.

Certification offers a host of benefits. Studies have shown that, compared to conventional buildings, LEED-certified buildings:

  • Use 25% less energy
  • Have 19% lower maintenance costs
  • Have 6% higher occupancy
  • Sell for 60% more

Other building energy efficiency certifications are BOMA BEST and ENERGY STAR.

More help for your retrofit project

Looking for more guidance on how to carry out a major retrofit project? Natural Resources Canada’s Major Energy Retrofit Guidelines are designed to help you understand when, why and how to undertake major retrofits and are divided into individual modules to help you identify the best opportunities for your building type.

Your privacy

BDC uses cookies to improve your experience on its website and for advertising purposes, to offer you products or services that are relevant to you. By clicking ῝I understand῎ or by continuing to browse this site, you consent to their use.

To find out more, consult our Policy on confidentiality.