Energy, the Environment and Natural Resources

Wednesday, May 27, 2026

The Standing Senate Committee on Energy, the Environment and Natural Resources has the honour to present its

THIRD REPORT

Your committee, to which was referred Bill S-4, An Act to amend the Energy Efficiency Act, has, in obedience to the order of reference of March 11, 2026, examined the said bill and now reports the same with the following amendments:

1.Clause 2, page 1: Replace lines 15 to 17 with the following:

“class of energy-using products that relates only to energy efficiency or the responsible use of energy, and, in particular, includes standards relating to”.

2.Clause 13, page 8: Replace line 13 of the English version with the following:

“the thing or product was forfeited, apply by notice in writ-”.

3.Clause 18, page 12: Replace line 19 with the following:

“and Renewable or Emerging Energy Sources”.

4.Clause 19, page 12: Replace line 27 with the following:

“accelerating energy efficiency and the use of renewable or emerging”.

5.Clause 25, page 30: Replace lines 26 to 33 with the following:

“tent to which selected energy efficiency standards prescribed under this Act are as stringent as comparable standards. Those comparable standards can be established by a province, the United Mexican States, the United States, or any other national or subnational jurisdiction.

58 (1) The Minister shall, five years after the day on which this section comes into force and every five years after that, undertake a review of this Act and its administration and operation, including an assessment of

(a) its effect on commercial entities;

(b) the exemptions provided for under sections 25 to 25.7;

(c) the corrective measures provided for under sections 26 to 26.2; and

(d) the administrative monetary penalties provided for under sections 37 to 54.”.

Respectfully submitted,

Observations to the third report of the Standing Senate Committee on Energy, the Environment and Natural Resources (Bill S-4)

1.The committee heard from witnesses regarding the importance of including anti-backsliding provisions within Bill S-4. Witnesses stated that anti-backsliding provisions would provide regulatory certainty for regulated industries and more stable energy bills for Canadians.

Therefore, the committee calls on the government to commit to preventing backsliding on standards when implementing Bill S-4 and when enacting regulations pursuant to the bill.

2.The committee observes that there exists a community readiness gap for certain rural, remote and Indigenous communities, related to benefitting from the new efficiency standards. This is largely related to the affordability of the initial capital costs. Achieving the objectives of Bill S-4 will require complementary supports to address these barriers and gaps. Accordingly, the committee calls on the government, in implementing Bill S-4, to consider:

•Funding incentives to assist in the purchase of energy-efficient appliances and technologies;

•Long term, flexible funding for capital retrofits and ongoing maintenance; and

•Educational funding to support communities in managing and maintaining new technologies in their homes.

3.The committee calls on the government to ensure the implementation of Bill S-4 and any future amendments to the Energy Efficiency Act in partnership with Indigenous stakeholders.

4.The committee calls on the government, when considering regulatory sandboxes and exemptions, to ensure they align with the United Nations Declaration on the Rights of Indigenous Peoples and consider Indigenous knowledge systems from start to finish.

5.The committee calls on the government to continue to collaborate with Indigenous Peoples to create direct space for Indigenous-held approaches to energy efficiency to create Indigenous-led energy-efficiency standards and frameworks.

6.With reference to the Assembly of First Nations report entitled Closing the Infrastructure Gap by 2030, the committee observes that achieving the objectives of Bill S-4 will require both improved self-determined energy efficiency and the closing of infrastructure gaps for First Nations. The committee therefore calls on the government to support First Nations in developing and implementing self-determined strategies to reduce emissions, along with increased investments to support First Nations infrastructure.

7.Given that improving energy efficiency standards alone will not completely address the issue of energy poverty and could even compound it, the committee calls upon the government to address energy poverty by implementing energy efficiency support programs to advance the uptake of energy efficient appliances for low-income households.

8.The committee calls on the government to make the regulatory process transparent and open under the Energy Efficiency Act so industry and experts can be involved in the process of recommending countries for international comparisons.

9.The committee observes that while the amendments to the Energy Efficiency Act through Bill S-4, are an important incremental step, the government should employ a more ambitious step-change in approach, in accordance with our international commitments to drive a deeper electrification process across sectors accelerating the energy transition and enhancing Canada’s economic performance.

10.With regard to subsection 4(1) at clause 4 of the bill,

It is prohibited for a commercial entity to ship an energy-using product from one province to another or import an energy-using product for a dealer to engage in any of those activities for a commercial purpose, unless:

(a) the product complies with the applicable energy efficiency standards; and

(b) the product’s label complies with the regulations.

Pursuant to an amendment during the committee’s study, responsibility for affixing a non-compliant label to an energy-using product would have rested with the manufacturer, importer or distributor, rather than the commercial entity. Although the amendment was defeated by the committee, the following observations were raised:

(a)Regarding the terms “ship” vs. “sell,” throughout debate in committee, both senators and government officials from Natural Resources Canada described the intent of this as ensuring that products being purchased and sold by commercial entities are held to the same standards as those being brought in by distributors. Debate focused on the buying and selling of products by commercial entities across provincial or international borders.

The section uses the word “ship” not “sell” in this section, “ship” encompasses a much broader range of commercial actions beyond a purchase or sale of an energy-using product. Under the current wording, any time a company moves an energy-using product interprovincially, for any commercial purpose — for example, construction equipment on a job site — they would be subject to compliance with this section.

In his testimony, Ben Copp, Director General, Office of Energy Efficiency Natural Resources Canada, explains that the intent is for products being sold, rather than used for commercial purposes: “The intent of that is that if it is being sold, crossing a provincial border or otherwise, yes, as per the introduction of “commercial entity” it would have to meet our energy-efficiency standards for commercial use.” It is the committee’s view that the wording currently included in the bill fails to address the reasonable realities of the commercial entity marketplace.

(b)Regarding the effective date of relevant regulations, in committee, government officials stated that “energy efficiency standards for the purpose of new subsection 4(1) are based on the date the product was manufactured.

No “effective date” of applicable new subsection 4.1(b) baseline regulations are explicitly set out in the legislation. A washer or dryer (better yet a generator moved/shipped inter provincially between a persons job sites) produced on a date prior to the subject amendment that met the standards of that time likely is non-compliant with the standards that exist now for energy efficient products and the commercial entity will not be protected by the saving provision in new paragraph 4(1)(b).

(c)Regarding lack of consultation with “commercial users,” the committee did not hear from “commercial users”, a principal group newly added to be made subject to this legislation.

Further review is required in the House of Commons to ensure such persons are added to the witness list, particularly one or more such persons who operate interprovincially and/or internationally.

11.The committee observes that, while Bill S-4 modernizes energy efficiency regulation, it does not clearly distinguish between new products entering the market and products being repaired, refurbished, reused or remanufactured within a circular economy framework. The committee asks the government for greater clarity, as it may be needed to ensure the bill does not unintentionally discourage product life extension and resource conservation.