Nova Scotians are particularly vulnerable to changes in the price of crude oil, since about 60 percent of households use fuel oil for space heating (as compared to about 13 percent for Canada as a whole). The 25 percent of Nova Scotian households that heat with electricity fare little better, since most of this province's electricity is generated from foreign sources of coal and oil.
With the heating season just starting and world energy prices at near record levels, space heating is, once again, becoming an issue in Nova Scotia.
Last week, the provincial government announced its $35 million "Smart Energy Choices for Nova Scotians" programme as a way of addressing the space heating issue. Despite the positive spin put on the announcement by the provincial Energy Minister, Cecil Clarke, closer examination reveals that the provincial government does not appreciate the magnitude of the problem many Nova Scotians are facing.
For example, it was surprising to read Mr. Clarke's justification for the programme, namely that there had been a "recent and sudden surge" in the price of home heating fuel. It is unclear what the minister meant by "recent and sudden", given what has happened to the price of home heating fuel over the past five or six years.
Throughout the 1990s, the price of home heating fuel purchased in Halifax during the heating season (October to May) remained fairly constant, averaging about 38 cents per litre. However, in 2000, the average seasonal price for heating oil jumped to 51 cents per litre; with the exception of 2002 and 2004, when average prices fell slightly, each season's price has been higher than the previous. By May 2005, the average seasonal price for heating fuel had doubled its 1999 average value to 78 cents per litre.
Similarly, it was disturbing to read that the number of Nova Scotian households that now qualify for "Keep the Heat" rebate this winter has tripled (not doubled, as stated in the government's press release), from about 25,000 in 2004-05 to 73,000 this winter. Although "Keep the Heat" has been expanded this year to include households that heat with electricity, wood, and natural gas, the fact that one Nova Scotian household in five requires assistance to meet its heating bills indicates that the government's energy policy is in shambles.
Regardless of the fuel source, space heating is the single largest energy requirement in an average Nova Scotian household, consuming slightly over 60 percent of all energy used (the rest goes to water heating, appliances, and lighting). If Nova Scotians are to be protected against the prospect of ever-rising energy prices, it will be necessary to reduce energy consumption.
This is typically achieved through conservation or energy efficiency measures. Conservation implies cutting back on energy use; for example, by lowering a home's temperature. Not surprisingly, conservation has its limits, as there reaches a point where living in a cold house can become both uncomfortable and unhealthy for its occupants. Energy efficiency, on the other hand, means using less energy more wisely. For example, increasing a building's thermal resistance (i.e., its insulation), requires less energy to maintain a comfortable temperature.
For the past few years, the federal government's "EnerGuide for Houses" home retrofit programme has assisted Canadians who want to improve the energy efficiency of their homes. The programme has a $150 audit fee for measuring the energy efficiency of the home and requires the homeowner to pay for any upgrades. Once the upgrades have taken place, a second measurement is taken, and the homeowner is reimbursed according to the efficiency gains obtained.
The problem with the EnerGuide home retrofit programme is that anyone wanting to take advantage of it must have the funds available to pay the audit fee and for the upgrades. Individuals struggling to pay their home heating bills will be hard pressed to take advantage of the EnerGuide programme.
With this in mind, perhaps the biggest surprise of all is the way the provincial government plans to spend $10 million on the "Energy Efficiency and Conservation" part of its Smart Energy programme:
Other than the $2 million to be spent on modest-income seniors, there is nothing in this programme to help improve the residential energy efficiency of those Nova Scotians who qualify for "Keep the Heat" and are unable to afford the EnerGuide's audit and retrofit costs. Furthermore, it is unclear how high-efficiency (and typically high-cost) heating equipment will benefit those who find it difficult to pay their heating bills.
A truly smart energy minister would recognize this limitation and immediately reallocate funds to institute a residential energy efficiency programme for Nova Scotians on low- and fixed-incomes.
Submitted to Chronicle-Herald 20 October 2005