Building Performance Standards (BPS) Are Here: What Does This Mean For Ontario Businesses?

Ontario’s commercial and industrial buildings are under growing pressure to reduce their carbon footprint and energy use. With Building Performance Standards (BPS) gaining momentum across Canada, Ontario businesses need to understand how these rules will affect operating costs, compliance obligations, and long-term competitiveness. For organizations looking to stay ahead, now is the time to prepare.

What Are Building Performance Standards? 

Building Performance Standards (BPS) are regulatory frameworks that set minimum energy or emissions performance levels for new and existing buildings. Many iterations of BPS also require strict transparency in building performance benchmarks. Unlike voluntary certifications or incentive programs, BPS are mandatory – meaning building owners and business owners must meet defined efficiency targets or face penalties. These standards can be set federally, provincially, or most commonly – municipally. For example, Vancouver has required the collection of energy and carbon reports for large buildings (100,000 sq. ft.) since 2024 and smaller businesses (50,000 sq. ft.) since the beginning of 2025. Beginning in 2026, large commercial buildings in Vancouver above 100,000 square feet will be subject to an onsite carbon pollution limit of: 

• 25 kg of CO2e per square meter, per year for office space. 

• 14 kg of CO2e per square meter, per year for retail space. 

Vancouver is not an isolated case either. Other municipalities have either installed or are in early phases of installing similar BPS programs across the country in Montreal, Toronto, Hamilton, Kitchener-Waterloo, and elsewhere. Internationally, cities like New York City and Seattle, as well as countries like France and the Netherlands have already adopted these policies.  

Federal climate commitments, paired with these municipal initiatives across the country are accelerating the adoption of performance-based standards. While Ontario’s provincial framework continues to evolve, forward-thinking businesses should expect building performance standards to tighten significantly over the next few years. 

How Building Performance Standards Affect Businesses and Developments 

For businesses and developers, the introduction of building performance standards means that energy efficiency will soon no longer be optional – it will be a baseline requirement for new and existing buildings. Companies will need to review how their facilities consume energy, whether through heating, cooling, lighting or overall building operations, and make measurable improvements to remain compliant. 

Developers, meanwhile, are under pressure to design and construct buildings that meet performance targets from the start. This not only avoids costly retrofits without government incentives down the road, but also makes new properties more attractive to investors, tenants, and future buyers who are increasingly demanding energy efficiency. 

Across both existing operations and new developments, these standards are reshaping decision-making in real estate, facilities management, and construction, pushing the industry towards a more efficient and sustainable future. 

Opportunities for Forward Thinking Companies 

While BPS may sound like another layer of regulation, proactive businesses can leverage these new standards to gain a competitive edge while staying compliant.

Access to Incentives 

Ontario utilities and federal programs are offering rebates for efficiency retrofits, renewable energy adoption, and smart building technologies. Proactive businesses and developers can access valuable incentives that will help improve their facilities –  and become compliant – for a fraction of the cost. In many cases, these programs also provide technical support and benchmarking tools, making it easier to identify the most cost-effective upgrades. Taking advantage of incentives early not only reduces upfront investment but also positions companies to capture limited-time funding before programs scale back or shift focus.

Lower Long-Term Costs 

Complying with Building Performance Standards creates measurable savings by cutting energy bills, reducing costly demand charges, and lowering heating and cooling expenses through upgrades like high-efficiency HVAC, LED retrofits, and solar integration. Beyond immediate savings, businesses also protect themselves against future financial risks, including rising carbon pricing policies and stricter regulations. By acting early, Ontario companies can lock in incentives, avoid penalties, and turn compliance into a long-term cost advantage that boosts profitability and operational resilience.

ESG Leadership 

Meeting or exceeding Ontario’s Building Performance Standards positions businesses as leaders in Environmental, Social, and Governance (ESG) responsibility, an increasingly important factor for investors, clients, and lenders. Compliance strengthens brand reputation, and attracts sustainability-focused capital. Forward-thinking businesses not only demonstrate environmental responsibility but also gain a competitive edge by aligning with global reporting frameworks and showcasing resilience to regulatory change – making ESG leadership both a compliance win and a business growth strategy.

Future-Proofing Assets 

By aligning with performance targets early, companies reduce the risk of expensive last-minute retrofits when regulations tighten. It also ensures that the building asset continues to be valued highly, as performance transparency will lead to inefficient buildings being more risky to investors. Beyond protecting value, proactive upgrades also help extend the lifespan of core building systems, stabilize operating costs, and make properties more attractive to tenants who increasingly prioritize energy-efficient spaces.

Why Partner With VCT Group 

As Ontario’s building performance standards rapidly change, your business or development needs more than just compliance – you need a comprehensive strategy. VCT Group helps companies navigate evolving regulations, and implement cost-saving solar solutions that align with your ESG commitments. 

With decades of experience delivering renewable energy projects across Ontario, we provide the expertise and technology to turn building performance standards from a burden into a business advantage. 

Now is the time to act. By moving forward while incentives are available, businesses can lock in lower project costs, get ahead of competitors, enhance property value, and strengthen their decarbonization strategy – before stricter requirements make compliance more expensive. 

We offer no-cost, no-obligation feasibility assessments for both retrofits and new construction, giving you a clear picture of what solar can do for your organization. Our assessment covers: 

• The solar capacity your property can support 

• Estimated long-term savings on energy costs 

• Available federal, provincial, and municipal incentives 

• Preliminary budgetary costing for your project