RC119 JulyAugust 2025 - Magazine - Page 14
DISTRICT ENERGY
GETTING CREATIVE
Fuel switch project is one of the largest
ever attempted in Canada by Glenn Miller
AKING THE TOUGH DECISIONS on where, when and how
to invest in infrastructure solutions that collectively have the potential to reduce greenhouse
gas emissions (GHG) generated from Canada’s
built environment has never been easy. But
for private sector energy utilities like Vancouver-based Creative Energy, which recently embarked on an
ambitious, capital-intensive “decarbonization” project in
downtown Vancouver to cut emissions by at least 25,000
tonnes per annum, the 昀椀nancial, logistical and market-driven challenges the company faces have reached an unprecedented level of complexity. Their decisions are further
complicated by pressure to follow federal, provincial climate guidelines, and, since 2022, municipal targets set by
the City of Vancouver for reducing emissions from large
buildings. Non-compliance carries sti昀昀 penalties for both
Creative Energy and its customers down the road.
In collaboration with BC Hydro, Creative Energy is moving ahead with a high stake “fuel switch project” intended
to transition the company’s downtown district energy
network from natural gas to low carbon electricity. Samson
Tam, Creative Energy’s director of development, says that
his company’s “thermal fuel switch project is one of the
largest ever attempted in Canada.”
Creative Energy currently delivers steam heat (and
domestic hot water) to 45 million square feet of space linked
through 15 kilometres of underground pipes to more than
200 commercial, institutional and residential buildings in
downtown Vancouver, making it one of the largest district
energy (DE) systems in Canada.
In 2022, after years of investigation and preparation, BC
Hydro 昀椀nally began construction of a 1.2-kilometre 69kV
transmission line to connect its substation in Chinatown to
Creative Energy’s Beatty Street plant, where a seismically
upgraded substation is being constructed in the basement
of a future mixed-use high-rise tower. The new substation
will allow aging natural gas boilers to be replaced with
an array of high-voltage, high e昀케ciency low NOx electric
boilers.
“The electric boilers are providing steam for now but can
be converted to provide hot water in the future,” says Tam.
“We are looking at strategic areas for steam to hot water
conversion, where multiple technologies can be incorporated down the road. The plan for installation of the electric
boilers is continuing to advance and will be complete by
2026.”
M
Glenn Miller, FCIP, is a
frequent contributor to
ReNew Canada. He is a
senior associate with the
Canadian Urban Institute.
14
RENEW CANADA – JULY/AUGUST 2025
In submissions to the British Columbia Utilities Commission (BCUC),
Creative Energy estimates that the
cost of converting the steam distribution system to a low-temperature hot
water system—the preferred medium
in modern district energy systems—
will be more than $200 million over a
20-year period. This does not include
the cost of individual building
conversions, which could account for an additional $180
million. Industry observers suggest that the fuel switch
project is, in e昀昀ect, a massive bet that dozens of downtown
landlords will take the opportunity to “decarbonize” by
connecting to the revitalized low-carbon DE system in order
to avoid penalties that would be otherwise be imposed
when the City of Vancouver’s Annual Greenhouse Gas and
Energy Limits by-law kicks in over the coming decades.
“The implications of (this) by-law … for our customers
are profound,” the submission states. “The current trajectory means that by 2040, at least 50 per cent of our customer
base will be subject to a GHG [greenhouse gas] emission
limit of zero. This percentage is expected to increase further,
with most of our customers likely facing this zero-emission
requirement by 2050. The by-law imposes a fee of $350 per
ton for carbon emissions that exceed the prescribed limit.”
Vancouver’s original “pre-Green” transformation
Until its purchase for $32 million in 2014 by developer Ian
Gillespie, Central Heat Distribution Ltd.—as it was known
for the 昀椀rst 46 years of its existence—was seen as a reliable
but stubbornly traditional provider of a昀昀ordable heating in
the downtown (delivering a remarkable 99.9 per cent reliability). Central Heat’s district energy system, established
in the late 1960s, was the catalyst to enable buildings in the
downtown core to replace highly polluting coal and fuel oil
with relatively clean natural gas as the primary source of
heating—a major transformative step towards improving
air quality in Vancouver, particularly the downtown core.
Only Vancouverites with long memories will recall a time
when the clear blue skies depicted on today’s post card
views of Vancouver were anything but the norm.
The idea that the city would one day have ambitions to
become the “world’s greenest city” would have been laughable at the time. In 1955, for example, a local newspaper ran
a four-part series stating that “one of the most vital prob-
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