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Remove barriers to better building

Energy upgrades to Australia’s building can contribute to a quarter of Australia’s 2030 emission reduction target. Improved building design, improved heating and cooling systems, and lighting, as well as other equipment and appliances, could help us achieve more than half our National Energy Productivity Target.

Our research has shown that delays lead to missed opportunities and wasted energy costs of billions.

Josh Frydenberg is the new federal environment and Energy Minister. He has an opportunity to show what his combined role can do. The COAG Energy Council is holding its first meeting in Canberra today with Australia’s Energy Ministers.

The National Energy Productivity Plan will be on the agenda. The plan aims to increase energy productivity by 40% by 2030. It involves increasing the value of each unit consumed.

The NEPP includes a number of good measures relating specifically to building. The NEPP contains a number of good measures pertaining to buildings.

What can be achieved by better buildings?

As you can see from the graphs below, our research discovered that buildings could help us achieve our climate and energy targets.

Our emissions target could be met by improving the energy efficiency of buildings. Distributed energy, primarily rooftop solar, could add 18%.

ClimateWorks Australia May 2016

Energy efficiency improvements can reduce energy consumption by 202 petajoules or half the amount needed to reach energy productivity targets.

ClimateWorks Australia May 2016: Potential contribution of built-environment energy efficiency to 2030 National Energy Productivity target (PJ).

Cost of delays

Overall progress has been slow despite the huge opportunity to reduce emissions in the building sector.

The market leaders in Australia, especially in the commercial offices, have made a dramatic change in energy productivity. They are recognized as global leaders for sustainable buildings. There are a number of examples in Australia that show very high performance or zero-emissions buildings.

The market has, however, improved its energy efficiency by only 2% in the last decade for commercial and residential buildings. We are currently not on track.

In our report, we found that if we continue to delay taking action to reduce building emissions, then we will lose out on a significant amount of options for improving energy performance. There are only a limited number of opportunities to reduce emissions. Installing inefficient equipment in place of more efficient alternatives can lock in excessive emissions into the future for decades.

Five years of delay can cost A$24 billion and result in more than 170 millions tonnes of emissions reductions lost by 2050. This is a huge loss, given that the current national emission target is to reduce emissions by 272 million tonnes by 2030.

Without further action, buildings will consume more than half the Australia’s “carbon budget” in 2050. This would leave less than half of Australia’s “carbon budget” for other sectors, such as emissions-intensive industries and transport, land, and agriculture.

ClimateWorks Australia, Cost of delay (MtCO2e), May 2016.

Stronger policy

In order to achieve the potential for emissions reduction in the building sector, it will be necessary to implement strong policies to address the barriers to improving the energy performance of buildings. In our report, we recommended five solutions that could be part of a comprehensive policy suite.

First, create a national plan for coordinating policy and emission-reduction measures in order to extend the gains made by leaders on the market to all sectors of construction.

Second, implement mandatory minimum standards for building, equipment, and appliances that are aligned with a long-term goal to net zero emissions.

Third, create incentives and programs that will motivate and support a higher energy performance within the next few months.

Fourth, reform the energy markets to support energy efficiency and distribution energy.

We need to provide a variety of data, information, education, and training measures that will enable consumers to make informed choices and encourage innovation, commercialisation, and the deployment of new business models and technologies.

These policy measures will put Australia on the path to zero-carbon building and unlock the huge potential of buildings to improve health outcomes, and make cities more liveable and productive.

Unblocking barriers

The Commonwealth, States, and Territories must coordinate to overcome the barriers that prevent the reduction of emissions from buildings.

In order to address this complexity, the NEPP requires stronger governance arrangements. This includes a specific target or targets for building, in addition to the 40% NEPP overall target, as well as more regular public reporting.

Stronger and clearer communication and engagement about the target and the buildings’ energy performance would also help to provide confidence and encourage innovation and activity within households and businesses.

We also need to improve coordination between members of the Energy Council and the other government agencies and forums.

The National Construction Code, for example, which sets minimum standards for all new construction and major renovations, is an important policy tool. The Building Ministers Forum oversees the code and not the Energy Council. A range of state and territory agencies supervise the enforcement of standards.

Similar issues include the harmonization of energy performance ratings between jurisdictions, coordination of training and accreditation for professionals in the building design and construction industry, and reform of the energy market to create a level playing ground for energy efficiency and renewable energy.

The Energy Council should focus on coordinating these issues. As the minister in charge of achieving both the national emission reduction targets and the productivity plan, the new environment and energy minister is uniquely positioned to lead this effort. We urge the COAG to support this effort.

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Jane S. King

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