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Backgrounder

Project to Convert Gagetown Military Housing Units to Natural Gas

CFHA–BG–06.028 - October 13, 2006

The Canadian Forces Housing Agency (CFHA) maintains a housing portfolio of approximately 1600 DND housing units at CFB Gagetown. Currently, these houses are serviced by oil heating systems and electrical hot water systems.

CFHA has awarded a contract to Enbridge Gas New Brunswick (EGNB), the provincial regulated gas utility company to convert the furnace and water heating systems in the housing units to natural gas.

CFHA has identified a number of key benefits that will arise from implementing this project. The key benefits are:

1. Housing unit occupants will realize an estimated home heating cost savings of $200 to $300 per year.
2. The proposal from EGNB will provide CFHA and the Canadian taxpayer a savings
   of approximately $5.4M in initial capital costs.
3. Converting to natural gas as a heating fuel will contribute to DND Federal House in Order (FHIO) targets and Sustainable Development Strategy (SDS) initiatives with the reduction of greenhouse gas emissions and other air pollutants by approximately 5 kilotons. As well, this proposal eliminates chronic health and safety and environmental liabilities associated with the fuel oil storage tanks.

Although EGNB is the regulated monopoly for gas line installation, EGNB does not have a monopoly for any work associated with the supply and installation of the heating equipment, or the natural gas supply. As part of the terms of the contract, using the public bidding system, EGNB will sub-contract the installation of the furnace and hot water heater to local contractors as much as possible. Conversions are expected to occur over an 18-month period, with minimum disturbance to occupants.

In addition to this conversion, CFHA has a replacement strategy for these systems under the existing life-cycle maintenance program. Over the next 5 to 10 years, older heating and electrical hot water systems in these housing units that have reached the end of their life-cycles will be replaced with more efficient and environmentally friendly equipment. The total cost of this equipment replacement program is approximately $6 million.

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