This week Canada became the 98th country to ratify the Kyoto Protocol of 1997, an international climate-change agreement. Under the protocol, Canada must reduce emissions of greenhouse gases to six per cent below 1990 levels by 2012.

But builders say that if federal government proposals to cut emissions from houses are put in place, the cost of building new homes will soar.

Greenhouse gas emissions are created when fossil fuels are combusted for heating and cooling. The government plans to cut these emissions by improving the energy efficiency of all new homes with tough new building code regulations, and by retrofiting at least 20 per cent of the existing housing stock by 2010.

Canada's R-2000 standard has represented the state-of-the-art in energy-efficient housing for more than 20 years. The goal of the standard is to reduce energy consumption of a house while improving indoor air quality. The standard also incorporates environmental features, such as water conservation and use of recycled materials, so that R-2000 houses have less impact on the environment.

R-2000 is currently a voluntary standard and only builders who have been R-2000 trained and licensed by the government can build an R-2000 home. The home must be evaluated, inspected, tested and certified before it's deemed an R-2000 home. So far, about 10,000 of the homes have been built in Canada in the last two decades, out of more than 150,000 new homes that are built annually in the country.

R-2000 standards can be applied to any style of home, as builders choose indoor air quality and environmental features from a "pick list" of options. The builder has flexibility in choosing construction techniques, building products, mechanical equipment, lighting and appliances.

Natural Resources Canada (NRCan), the government agency that administers the program, says the cost of building an R-2000 home averages four to seven per cent more than a conventional new home. However, heating costs are more than 30 per cent lower. The average R-2000 family recovers its additional investment within seven years -- during which it enjoys the value of the extra comfort and healthy features of the home, NRCan says.

"Every R-2000 home constructed delivers a meaningful, immediate and ongoing reduction in greenhouse gas emissions," says Tex McLeod, an R-2000 builder and trainer. "It's a win-win situation: the environment benefits and the homeowner has lower heating bills."

But builders say that by forcing everyone to build to R-2000 standards, costs and red tape will rise. The Canadian Home Builders' Association, which has been an R-2000 partner since the program began, says added regulations are not needed because energy efficiency improvements are already happening through normal market forces.

The standard has been credited with improving the quality and energy-efficiency of all new housing in Canada, as many of the original concepts from it have been incorporated into conventional new home designs. Many builders say their homes are built to the R-2000 standard, but that they didn't bother to register them because of the bureaucracy involved.

But NRCan says there's no assurance that the homes have been built properly unless they are tested and certified as genuine R-2000 houses. One of the biggest concerns is that houses are being made more air-tight to keep the heat in, but are not being properly ventilated, resulting in poor indoor air quality. R-2000 homes include heat-recovery ventilation units that provide a continuous supply of fresh air in the home.

More builder participation in the program has been encouraged by streamlining the R-2000 standard documents and reducing the red tape involved in registering homes, but it still takes a large commitment of time to become a registered R-2000 builder. The standard is constantly being updated -- the latest update of the R-2000 standard took effect in April 2002, and more updates are already in the works.

The government's proposals for existing homes include expanding an existing program called EnerGuide for Houses, in which homeowners can get an "energy audit" of their homes with suggestions for improving energy efficiency. Financial incentives for retrofits will also be explored, the government proposals say.