ENDING THE PATCHWORK APPROACH TO ADOPTION OF THE BC ZERO CARBON STEP CODE (2025)

Issue

The BC Zero Carbon Step Code (ZCSC) was introduced in 2023 as part of the BC Building Code to guide the province toward reducing greenhouse gas emissions in new construction. While the province has set a 2030 target for all new buildings to be zero carbon emitting and will move the province along towards that policy with provincial regulations, it also allows municipalities to pre-adopt higher levels of the ZCSC at their discretion. This has led to a patchwork of different regulations across BC, creating confusion for builders, pre-emptively driving up construction costs, and limiting energy choice for homeowners and businesses. To ensure a balanced approach to emissions reduction, the BC Government should remove the ability for individual municipalities to pre-adopt Zero Carbon Step Code requirements and instead move all jurisdictions forward in alignment with the province’s planned step-based approach.

Background

The BC Energy Step Code, introduced in 2017, set province-wide performance-based standards for energy efficiency in new construction. Municipalities were allowed to incentivize or require builders to meet Steps beyond the province’s minimums. However, the ZCSC added in 2023 goes further by aiming for zero emissions from buildings, and therefore functionally regulating the types of energy that can be used in new buildings, often requiring full electrification and effectively banning natural gas and other alternatives.

The ZCSC is comprised of 4 ‘steps’: EL-1 (Measure Emissions Only), EL-2 (Moderate Carbon Performance), EL-3 (Strong Carbon Performance) and EL-4 (Zero Carbon Performance). Currently, the ZCBC is not mandated by the province at any level, but the provincial government provided municipalities with discretion to pre-adopt standards in their own communities. This has resulted in a fractured and inconsistent regulatory landscape across the province, with 29 municipalities dotted across the province having adopted some level of the ZCBC.

For example, in the Lower Mainland, some municipalities such as Burnaby and Port Moody have already adopted the highest ZCSC levels, effectively banning natural gas in new construction. Others, like Langley Township, have adopted only some measures (EL-2 in 2024 and EL-3 in 2025), while still others, like Surrey or Delta, have not yet adopted any requirements. The result is that businesses, developers, and homeowners must navigate different energy regulations based on municipal boundaries, leading to increased costs, regulatory uncertainty, and consumer confusion.

This type of patchwork adoption was foreseen by the government and advocated against. The government’s own Step Code Council in its Best Practices Guide for Local Governments recommends against a patchwork approach, noting that it “strongly encourages local governments to plan (ZCSC adoption) alongside neighbouring communities…to reduce confusion.”[1] However, this has not been happening in practice. Builders who work across multiple municipalities are now forced to comply with differing energy standards, increasing complexity and cost.

Beyond increasing costs and creating a regulatory patchwork, this early adoption of the ZCSC reduces energy choice for businesses and consumers, and negatively impacts BC’s housing affordability and business competitiveness.

To meet the EL-3 and EL-4 levels of the ZCSC, any non-electrical energy sources end up functionally prohibited. Even at the EL-2 level, a natural gas-powered stove would be permissible only in limited cases. Businesses and homeowners should have reliable and affordable energy options, including renewable natural gas and potentially hydrogen in the future, but this policy effectively bans their use. In some instances, natural gas may be the cheaper option for heating a building, or the desired option for use in appliances, particularly in food-service businesses, but under the ZCSC, those options are not allowed.

The incremental increased cost to build to ZCSC should also be noted, with the increased cost for a modest single-family home (~2000sqf) being up to $57.6 per sqm (or over $11,500) as forecast by the government itself.[2] For high-rise residential or commercial buildings, the government’s forecast of the incremental increase in building cost can be as high as $105.6 per sqm.

Beyond higher building costs, requiring all new buildings to run only on electricity, as the higher levels of the ZCSC effectively do, could lead to higher energy bills for homeowners and businesses. BC Hydro has already had to spend more than $1.3 billion in one year buying electricity from the U.S. and Alberta, where much of the power comes from fossil fuels, just to meet current demand.[3] As more buildings and vehicles rely solely on electricity, those costs could go up even more. Consumers may face higher utility bills, particularly during peak usage or supply shortages, or if energy imports are impacted by tariffs. Removing other affordable energy options, like renewable natural gas, limits flexibility and could leave BC more exposed to rising energy costs, power shortages, or even future tariffs on imported electricity.

In a growing, energy-rich province, we should be building for energy resilience and flexibility by allowing a mix of energy sources instead of relying so heavily on one form: electricity. A province-wide, coordinated approach to the Zero Carbon Step Code would ensure a more predictable and effective transition to lower emissions without unduly harming affordability and economic competitiveness, and would allow the province to make reasonable changes to the step code timeline should it be required due to affordability concerns, industry realities, or other potential changes.

THE CHAMBER RECOMMENDS

That the Provincial Government:

1. Review the current 2030 timeframe in consultation with industry and local governments to develop a new, longer-term timeframe that is a more appropriate and achievable target for emission reductions, without unduly negatively impacting affordability and economic growth.
2. Remove the ability for individual municipalities to pre-adopt the Zero Carbon Step Code ahead of provincial implementation and ensure that all jurisdictions move forward on a unified, provincial timeline.
3. Ensure that energy choice remains available to businesses and homeowners by allowing the continued use of alternative low-emission energy sources such as renewable natural gas and hydrogen.