District Energy - 2008 Second Quarter

dential developments with either district heating or cooling, but not both to a collection of homes of this size and density. The project is engineered by FVB Energy Inc., Markham’s consultant.

Working With Developers

For Markham District Energy, working with the development community was initially a challenge. There was a natural resistance to change combined with built-in competition from the suppliers of the status-quo energy solutions. One barrier that presented itself early was a regulation in the Ontario Condominium Act that prevents a developer from signing long-term contracts before the building is transferred over to the condominium corporation. This regulation exists to prevent builders from committing the eventual owners to an above-market price for services such as building maintenance that might be provided by an associated company of the developer. If read without the correct interpretation, this regulation would prohibit the signing of a long-term district energy agreement.

Markham District Energy worked

with the developer to determine that disclosure of the district energy proposition to the condominium buyers during the sales process was the solution to the perceived barrier. The disclosure outlines that district energy, when evaluated over the life cycle, is competitive with the traditional in-building boiler and chiller option. On a related point, it could be argued that if a builder constructed, for example, an all-electric heated building, that initial design decision commits the owners to a specific energy source for the life of the building. While there may not be a long-term agreement with the electric utility for electric heat, disclosure of the design feature and the potential long-term costs would need to be disclosed to the buyers.

Over the first few years, and as the system proved its reliability, developers and their consultants have come to understand the system operations and how district energy benefits the building owners and operators. As a result, all new developments have connected or have committed to connect. Key to this is Markham’s reliability performance – a hallmark feature of any district energy

system. Since the start of service to IBM in 2000, the Markham system has logged more than 63,000 hours (more than seven years) without one hour of unscheduled system downtime.

If one is considering sustainable city building or a brownfield remediation planning process, Markham’s success story is strong evidence that energy planning should be part of the urban planning process. Investments in infrastructure must be made in advance with strong support from the municipality to set the groundwork for developers to consider connection to the district system as the base-case option.

Bruce Ander, P.Eng., is president and chief executive officer of Markham District Energy Inc., an energy company owned by the town of Markham, Ont. He is currently chair of the Canadian District Energy Association and past chair of the Canadian Energy Efficiency Alliance. Ander is a professional engineer and holds a master’s in business administration from the University of Toronto. His email address is bander@mdei.ca.

Tell us your story.

From now until Thurs., May 15, 2008, IDEA is accepting abstracts for articles to be published in District Energy magazine during calendar year 2009. Abstracts will be accepted from both members and nonmembers, with members receiving first-chance consideration. The editorial committee will meet during the annual conference to review the abstracts and recommend editorial content for 2009. Abstracts should be 150-200 words and submitted via email to Executive Editor Monica Westerlund at mlw@westerlund.com.