Status of Solar Heating/Cooling and Solar Buildings - 2021

Status of the Market for Solar Thermal Systems

Market Size and Trends

The Canadian solar thermal industry experienced another decrease in terms of revenue and collector area in 2019 and 2020. Total industry revenue in 2020 was $2.5 million compared to $3.0 million in 2019. At its peak in 2010, industry revenue reached $37.4 million. Collector sales dropped to 8,851 m² in 2020 from 14,667 m² in 2019. It should be noted the small size of the Canadian solar thermal market is making it increasingly susceptible to the fortunes of individual companies and projects, particularly for technologies that focus on the commercial sector. Most residential technologies experienced declines in both 2019 and 2020. Sales in 2020 were also impacted by the COVID-19 pandemic.

When the Canadian domestic market is analyzed by collector type, it becomes clear that all technologies were impacted by the continuing industry slide. The trend of decreasing sales that has been ongoing since 2010 continues, with 2020 domestic sales at only 6.7% of those in 2010, and representing only $0.06 per person in Canada. This deep, prolonged fall-off has led to an overall decrease in GHG emissions avoided in 2020 and 2019. It is a trend that is expected to continue for several years, in the absence of a rapid turnaround in sales of solar thermal collectors. The reduction in the domestic solar thermal market since 2010 is due to the ending of financial incentive programs at the national level and the low cost of natural gas for heating.

Solar air heating collectors continues to dominate the Canadian domestic and export markets, after solar pool heating. In 2020, solar air heating collectors represented 61% of solar collector domestic sales per m². Unglazed solar air collectors represented, in 2020, 85% of total air heating collector domestic and export collector area. Unglazed air heating collectors represent the largest market segment by collector area in Canada, with 52% of total sales, followed by liquid unglazed collectors, which represented 27% of total sales in m² in 2020.

Typical Applications and Products

The typical applications for solar thermal products in Canada are space and ventilation air heating for commercial and industrial buildings (primarily using integrated unglazed and glazed collectors in open loop systems to heat outdoor air), residential outdoor pool heating (primarily with unglazed plastic flat plate liquid solar collectors) and domestic hot water heating for residential and commercial application (both glazed flat plate and vacuum tube liquid solar collectors). There were some notable changes in 2018 when compared to the distribution reported in 2017. For instance, liquid glazed collector distribution shifted from 70% residential to 15% residential. The liquid unglazed market continued with 100% of the collectors being used in the residential pool sector. The air glazed and unglazed markets also remained unchanged from 2017, both being used entirely for ICI space heating. The typical packaged sdhw system is a low flow pumped glycol system with a side-arm thermosyphon heat exchanger connected to a solar preheat tank.

Main Market Drivers

Currently there are no regulations requiring the use of solar thermal in new or existing buildings in Canada. The key driver for purchasing solar thermal has largely been financial therefore changes in conventional fuel prices and financial incentive programs have a significant impact on purchase decisions. Current low prices for natural gas heating and the expiration of national financial incentives almost a decade ago for solar thermal have resulted in a decrease in the domestic solar thermal market in Canada. In general, there is a low level of awareness of the potential for solar heating and cooling. New building energy performance standards under development may be a key future driver for the sale of solar thermal products in Canada as builders look for ways to meet the higher energy performance targets. In a survey conducted in 2021 with solar thermal companies, the majority indicated "low energy prices" as the largest barrier for solar thermal market development in Canada.

Industry

There is a small domestic manufacturing base for solar thermal in Canada, notably for solar air and unglazed liquid collectors. The industry includes collector and system manufacturers, importers, as well as wholesale, retail, and installers. Solar thermal exports represented 38% of total sales in 2020 in terms collectors area. Compared to 2010, the share of collector's exports have grown from about 10% of total sales in terms of revenue to about 38% in 2020 and their relative importance has generally increased as total sales have tended to decline. The majority of export sales (74%) in 2020 were solar air heating collectors-  all unglazed - with liquid unglazed pool collectors at 27% of exports, and with no glazed liquid collectors' exports.

Employment

Total employment among respondents to a 2020 survey was reported to be 31 employees, down from 61 in 2016 and 93 employees in 2015. Note that this survey was not designed to capture all employment at the manufacturing, distribution, retail and installer levels, and therefore total employment in the Canadian solar thermal industry may be higher than is presented in this report (note that not all respondents provided these details)

Costs

In 2014 (the most recent available data), the installed cost of large-scale solar district heating systems is estimated to be about Canadian $1,000/m2 for high-solar fraction (>90%) Drake Landing-like designs including the installed cost of: roof-mounted solar collectors, district heating network, borehole field seasonal storage, short-term thermal storage tanks, engineering, supervision and commissioning.

A typical forced-circulation, 6m2 (two-collector), residential solar domestic hot water system with a preheat solar tank, circulation pump, side-arm heat exchanger costs CAD $7,750 installed, taxes excluded.

Commercial-size solar water heating systems including solar collectors, forced-circulation pumps, solar storage tanks and heat exchanger typically cost between CAD $1000/m2 and $1500/m2 installed, taxes excluded for liquid heating flat plate or evacuuated tube collectors and approximately $250 (2013) for liquid heating unglazed (pool) collectors.

The typical installed cost, of commercial-size air heating systems in 2013, including fans and distribution ducting range between CAD $150/m2 and $300/m2 using unglazed (open-to-ambient) air heating collectors and between $150/m2 and $1,500/m2 with glazed (open-to-ambient) air heating collectors, taxes excluded.

Status of the Market for Solar Buildings

Scope

In Canada, there is a focus on energy-efficient buildings rather than solely on solar buildings. In addition to solar water heating, several solar technologies including passive solar, solar air heating of the ventilation air and the living space, daylighting and photovoltaics are applied in such buildings along with energy-efficient non-solar technologies. Certifications such as LEED for commercial buildings and Energuide Rating System (ERS) in the residential sector are often sought for recognition of the efficiency levels achieved. Net-zero or near net-zero housing and buildings represent the leading edge of research and development of highly energy efficient buildings. For net-zero energy housing and buildings focus is to drastically reduce loads using energy-efficient technologies first and then incorporate solar or renewable options to meet the remaining loads.

Market Size and Trends

 

 

Main Market Drivers

Over the years, our federal, provincial and local building codes have incrementally required the higher levels of energy efficiency. For example, a typical house built to year 2005 code when constructed to today’s (2017) code would be about 17% more energy efficient. As such, currently there are no specific regulations requiring the design and construction of very energy efficient or solar buildings in Canada. It is thought that a key driver for their construction is the desire to showcase the owners commitment to reducing the environmental impact of their business. Heavily subsidized FIT (feed in tarrff) incentives for photovoltaics in Ontario and BC have increased the use of PV on buildings. New building energy performance standards under development are going to be key future drivers for the highly energy-efficient buildings market by requiring builders to meet the higher energy performance targets.

Costs

The incremental cost of building to achieve net-zero energy performance for a typical, two-storey, 200 sqm, single-family Canadian house has been found to be between CAD $40,000 and $60,000, depending on the approach taken in the design and equipment selected. The incremental cost represent about 5% to 18% of the new home value depending on the location.

R&D Activities

R&D Programmes

National R&D programmes exist for both solar thermal energy and for building energy efficiency through Natural Resources Canada (NRCan). In 2020, the budget for solar thermal energy was approximately CAD $1.3 million. The main priority is to accelerate the development by working with industry on technologies that have potential to be economically viable and contribute to significant greenhouse gas emission reduction. The current active solar R&D program is focused on increasing the utilization of solar energy through seasonal storage for both community scale and single family home applications (through thermochemical energy storage).

R&D Infrastructure

Institution Type Research Areas Involvement Website
Renewable Heat & Power Group, CanmetENERGY Government Research Institution Solar Thermal Exco, Task 55, 58 www.nrcan.gc.ca/energy/renewable-electricity/solar-thermal/7301
Buildings Research Group, CanmetENERGY Government Research Institution Low and Net-zero Energy Buildings www.nrcan.gc.ca/energy/efficiency/buildings/4261
Smart Net-zero Energy Building Research Concordia University Solar integrated buildings Task 56 www.concordia.ca/research/zero-energy-building.html
National Solar Test Facility Public/Private Partnership Solar Energy Equipment Testing and Development Task 43 & 45 www.nrcan.gc.ca/energy/renewable-electricity/solar-thermal/7335
U of Calgary solar energy design lab University of Calgary Solar neighbourhood design and planning Task 63 www.ucalgary.ca/solarenergydesignlab

Actual Innovations

Previous major active solar R&D accomplishments in Canada include the transpired solar air collector and the low flow solar water heater product developments. These are now commercialized and the main technical support in these areas is related to testing and certification standards both nationally and internationally.

Support Framework

Background

Renewable energy currently provides 17.3% of Canada’s primary energy production, primarily from large hydro (11.7%), biomass (4%), wind (0.9%) and other, including solar, ethanol and municipal waste (0.7%). Canada’s goal is to accelerate the development of renewables by working with industry on technologies that have potential to be economically viable and contribute to significant greenhouse gas emission reduction. Canada plans to reduce its greenhouse gas (GHG) emissions by 30% below 2005 levels by 2030 and to a reduction of 80% by 2050. The federal government has provided sustained research and development funding to this end through the Program on Energy Research and Development (PERD).

Government Agencies Responsible for Solar Thermal, for Solar Building Activities

Natural Resources Canada (NRCan) is the lead federal department responsible for solar heating and cooling R&D in Canada. R&D funds for solar heating and cooling are managed by the Renewable Heat & Power Group within NRCan’s CanmetENERGY-Ottawa. NRCan’s National Solar Test Facility (NSTF) located near Toronto, operated by Element, is Canada’s leading solar testing facility and supports NRCan’s R&D activities. It includes a 200 kW large area indoor solar simulator and climate controlled chamber where testing is performed for both product development and to Canadian and international standards for certification and rating.

Other federal government organizations that conduct activities in support of solar energy and buildings research include CanmetENERGY-Varennes, Environment Canada’s Meteorological Service, which continues to manage solar resource measurement and meteorological data base development activities, the National Research Council’s Institute for Research in Construction in Ottawa, which conducts research in windows and daylighting technologies, and the Canada Mortgage and Housing Corporation led a demonstration of equilibrium or net-zero homes across Canada which was completed in 2014.

 

Most Important Public Support Measure(s) for Solar Thermal and for Solar Buildings

R&D funding is currently the most important support measure for solar thermal technologies and for low-energy and net-zero energy buildings in Canada.  Training and education  in these technologies through Universities and Colleges is also a very important support mechanism.  Most solar thermal systems installed by business are also eligible for income tax reductions through accelerated depreciation.  National standards set minimum quality levels for solar collectors and SDHW systems.  Certification programs were established for solar collectors, SDHW systems and SDHW installers, however, they were not sustainable with the small market remaining after purchase incentives ended.

Information Resources

National Solar Associations (industry and non-industry)

The Canadian Solar Industries Association (CANSIA) merged with the local wind power association to form the Canadian Renewable Energy Association. https://renewablesassociation.ca/solar-energy/

The association, however, is focused on electricity and excludes solar thermal from its activities. As of 2020, there was no solar thermal association in Canada.

National Associations on Green/Solar/Sustainable Buildings

Canadian Home Builders Association (CHBA) http://www.chba.ca/  

Canadian Green Building Council (CaGBC)  https://www.cagbc.org/  

Most Important Media for Solar Thermal and Solar Buildings

Websites

Solar Thermal - http://www.nrcan.gc.ca/energy/renewable-electricity/solar-thermal/7301

Energy Efficiency in Buildings- http://www.nrcan.gc.ca/energy/efficiency/buildings/4261

Energy Efficiency in Housing - https://www.nrcan.gc.ca/energy-efficiency/energy-efficiency-homes/20546

Solar and Building Technology - http://www.iea-shc.org/

Periodicals

High Performing Buildings Magazine - Published by American Society of Heating, Refrigerating and Air-Conditioning Engineers