When Sustainability Meets Energy Policy
The CEO Perspective, by Michael Brooks
March 17, 2026
Decarbonization Depends on Clean, Available Power
When does sustainability policy run into energy policy? The answer is increasingly clear, when the decarbonization pathway for buildings in Canada depends on electrification, and on an ample, reliable supply of clean power.
For the commercial real estate industry, this intersection is no longer theoretical. As building owners and investors work to reduce emissions, the conversation quickly turns to electricity supply, grid capacity, and the policies that determine who can access clean energy and on what terms. In that sense, energy policy is now central to sustainability policy.
At REALPAC, this has led to growing engagement on provincial energy issues. In Ontario in particular, we are focused on advocating for virtual power purchase agreements and distributed energy resources. Our objective is straightforward, all members should have a viable path to procure clean power, help fund new clean generation directly, or generate power onsite through net metering, at a minimum.
Industry Priorities Raised in Ottawa
On March 9, we met with representatives from both Natural Resources Canada and Environment and Climate Change Canada in Ottawa.
At Natural Resources Canada, we discussed the federal government’s emerging national energy strategy. The Minister of Natural Resources and Energy and his team are developing what is expected to be a new blueprint for the reorientation of Canada’s national grid, with a stronger east-west focus, rather than relying primarily on the north-south orientation that has historically defined our energy system.
That shift will require significant new supply, major infrastructure investment, and a practical framework for mobilizing private capital. For REALPAC members with infrastructure-focused strategies and funds, this is an area that will be watched closely.
Access, Allocation, and Affordability Remain Key Challenges
In our discussion with NRCan, I reiterated many of the challenges our industry continues to face.
In major urban centres, there are often long waits for electricity allocation. At the same time, there is a clear demand among our members for clean energy procurement. Yet many are not even eligible to pursue a virtual power purchase agreement because they do not meet very high electricity consumption thresholds. That creates a significant barrier for building owners who are committed to decarbonization but do not have access to the tools needed to support it.
The challenge is even more visible for users with especially large energy needs, such as data centres, which can face very long timelines before sufficient electricity supply is available, in some cases stretching into years.
There is also an understandable public policy concern around electricity affordability. As Canada works to build out an east-west grid and serve the needs of data centres and other major users, rising system costs could translate into consumer pressure and political backlash. This is a difficult balance for governments to manage. The opportunity is real, but so is the risk.
The federal government will need private sector capital to help deliver this transition. At the same time, policymakers will be mindful that if required returns are too high, the resulting cost pressures could become inflationary. It is a narrow path, but one that could create important openings for investment if designed well.
A Potential Role for New Investment Structures
For members active in infrastructure investment, particularly on the supply side, this evolving landscape may also raise broader questions about market structure and asset classes.
One possibility is whether there may be room over time for expanded REIT asset classes tied to energy infrastructure. For example, it is reasonable to ask whether certain transmission-related assets could eventually be treated in ways that parallel how cell tower assets have been structured under REIT rules in the United States. That is not a conclusion, but it is the kind of question worth considering as Canada’s energy system evolves and private capital is asked to play a larger role.
A More Consumer-Friendly Path to Carbon Reduction
Our meeting with Environment and Climate Change Canada reinforced a related point. Their focus remains firmly on carbon reduction, but there is also clear interest in finding a more positive, consumer-friendly path forward.
We were able to share REALPAC’s 2024 report on the owners’ and investors’ perspective on decarbonization, and there was strong interest in reviewing that work and continuing to engage with us on a responsible and practical approach that supports both emissions reduction and industry progress.
That is encouraging. Policy will be more effective when it reflects the operational realities of the sectors expected to deliver results.
Encouraging Signs of Momentum
The clearest takeaway from both meetings was that this government appears to be highly action-oriented, with clear mandates and a strong desire to move forward quickly.
For our industry, that sense of momentum matters. Canada’s decarbonization goals for buildings will only be achievable if they are matched by serious progress on energy policy, including generation, transmission, procurement flexibility, and the practical conditions needed to attract capital.
There is still a great deal to work through, but the direction of travel is becoming more visible. That, in itself, is encouraging.
About the Author:
Michael is the Chief Executive Officer at REALPAC, with overall responsibility for the success of the organization and the industry, including events, government relations, research, standards and best practice, and education. Michael was formerly a commercial real estate lawyer and partner, and the real estate practice group leader, at a major Canadian law firm.