Residential and commercial building design
This chapter focuses on the challenges climate change presents for the
resilience of residential and commercial buildings.
Issues with existing building design in the face of climate change
Evidence presented during this inquiry indicates that climate change is
expected to affect the physical structure of houses and other buildings in at
least three key ways:
- First, gradually and over time, changes to weather patterns such
as increased temperature and rainfall, as well as increased solar radiation,
could have a greater impact on the integrity of buildings than at present. For
example, building materials could degrade or fail faster due to higher
temperatures, and variations in rainfall could compromise building foundations.
- Secondly, other changes linked to climate change such as higher
sea levels could lead to the loss or damage of property.
- Thirdly, expected increases in either the frequency or intensity
of extreme events, such as storm surges, flooding, bushfires and cyclones,
could significantly damage or destroy large numbers of properties.
In addition to climate change affecting the physical structure of
buildings, building occupants are also affected. In particular, temperature has
a direct impact on the health, comfort and productivity of building occupants.
Overview of building standards
Minimum performance requirements for the design, construction and
performance of building work are set by the National Construction Code (NCC),
which is developed by the Australian Building Codes Board (ABCB).
Standards Australia also advised that the Australian Standards it develops
provide guidance for the building and construction industry as many of its
standards are reflected in the NCC and, therefore, state and territory building
and planning regulations.
The NCC is not, however, applied consistently nationwide:
- The Northern Territory Government advised that it departed from
the latest energy efficiency provisions of the NCC due to the likely cost
implications associated with bringing 'the Northern Territory into line' with
- In New South Wales, parts of the NCC regarding the energy
efficiency of residential buildings are varied and assessment under the
Building Sustainability Index (BASIX) is instead undertaken.
Australian buildings are classified on a star-based scale for energy
efficiency under the Nationwide House Energy Rating Scheme (NatHERS). NatHERS
was added to the NCC in 2003. A recent research paper on heat stress-resistant
building design provides the following explanation of the NatHERS star rating
The NatHERS classifies buildings with stars from 0 to 10,
based on the predicted annual thermal energy consumed for heating and cooling.
The stars correlate to the nominally predicted annual thermal energy
consumption, where more stars mean less energy used. The minimum requirements
for new buildings were gradually raised to 6 stars, which became mandatory in
For commercial buildings, the New South Wales' Young Lawyers Environment
and Planning Law Committee explained that the 'Building Energy Efficiency
Disclosure Act 2010 (Cth) requires commercial buildings above a certain
floor space to meet energy efficiency requirements through National Australian
Built Environment Rating System (NABERS) certification scheme'.
Design requirements and practice in
the face of climate change
As Australia has a history of extreme weather events, building standards
have changed over time to strengthen building resilience. The changes introduced
following Tropical Cyclone Tracy in 1974 were cited as examples.
With respect to Tropical Cyclone Yasi (2011), Standards Australia submitted the
following evidence on how standards regarding wind loading developed in the
1980s have helped improve public safety:
The powerful cyclone had extreme wind speeds and caused major
destruction but did not directly result in any deaths. The damage to
infrastructure in the area, although severe and the most costly throughout
Australian history, was less than anticipated due to the implementation of
post-1980s Australian Standards that specified the structure of housing in the
cyclone-prone region. This is a story of Australian Standards working for the
Australian community, ensuring competitiveness in the sector, while at the same
time maintaining quality and promoting safety.
Similarly, the Chief Executive Officer of the ABCB highlighted how data
collected as a result of cyclones since Cyclone Larry in 2006 indicate that
buildings constructed in accordance with the new standards 'are largely holding
Furthermore, a representative of the Housing Industry Association (HIA)
commented that during the 2011 Brisbane floods:
...the buildings that were designed to stay dry during the
one-in-100-year event based on 1974 calculations all stayed dry. It was only
buildings that had been allowed to be built in areas that weren't safe from
one-in-100-year floods that got wet.
Other elements of building standards that are relevant when considering
climate change are energy efficiency and water sensitive design. Various
efforts to improve the sustainability and energy efficiency of buildings were
referred to during this inquiry, such as the Green Building Council Australia's
Green Star rating scheme. Since the Green Star scheme commenced in 2003, over
1400 projects have been Green Star-certified, including 37 per cent of office
space in central business districts and apartments that house 40,000 people.
Other examples drawn to the committee's attention include:
- buildings at universities, such as the first six star Green Star
education building in Australia opened at Bond University in 2008;
- a housing estate managed by South East Water in Melbourne where,
in addition to energy efficiency measures, houses are being developing with
remote controlled rainwater tanks that enable water to be released before
intense rainfall events, thus reducing the risk of urban flooding and damage to
passive apartment design that can keep the internal temperatures
of the apartments moderate without relying on air conditioning, such as the
Nightingale apartments in Melbourne.
Nevertheless, evidence received during this inquiry indicates that
Australian buildings are generally not well suited to the existing climate, let
alone a future further affected by climate change. It was also argued that the
uptake of schemes to improve housing standards in the face of climate change
such as the Green Star program is not occurring as rapidly as is required.
Heat stress in existing housing stock is a particular concern. For
example, the National Climate Change Adaptation Research Facility (NCCARF)
In many parts of Australia, housing is poorly adapted to the
current climate, and this is particularly the case for many modern developments,
where lack of insulation and passive design elements mean that auxiliary
heating or cooling, which accounts for about 40% (or much more in some
climates) of energy use in the average Australian home, are the only way to
maintain a comfortable environment for much of the year.
From a Western Australian perspective, Regional Development Australia –
South West (RDA South West), noted that most houses are 'still constructed of
double brick', which it submitted has a higher thermal conductivity (0.6–1.0 W/(m
K)) than other building materials, such as 'timber (0.12), glass (0.96), gypsum
board (0.17), rock wool (0.045) and other insulation materials (0.0035–0.16)'.
As the introduction of mandatory energy efficiency requirements only
apply to new buildings, most buildings have a much lower efficiency rating.
Using Victoria as an example, the Centre for Sustainable Infrastructure at the
Swinburne University of Technology highlighted how the majority of the housing
stock is significantly below the new energy efficiency requirements:
In Victoria, approximately 1.9 million (86%) of the existing
houses were built before the introduction of mandatory energy efficiency
requirements in 2005. Through an on-ground assessment of 60 sample houses,
Sustainability Victoria reported that average NatHERS energy star rating of the
existing houses constructed before 2005 is 1.81.
Building design has clear implications for human health. For example,
there is concern that building occupants are increasingly dependent on air
conditioning during heat periods, and that this dependency exposes large
numbers of people to health risks, including death, during heatwave events. The
Centre for Sustainable Infrastructure at Swinburne University of Technology
explained these concerns in its submission as follows:
In Australia, heat events have killed more people than any
other natural hazard experienced over the past 200 years. Humans spend most of
their time indoors during heatwave period, as such assessment of indoor heat
stress is an important issue for public health care. During [the] 2003 heatwave
in Paris, 74% of excess deaths occurred among those who were staying at home.
The situation in Australia is similar to that in Paris considering that the
most vulnerable population is the elderly people group. In Australia, there is
a growing dependence on mechanical air-conditioning to reduce the impact of
heat stress. In March 2014, 74% of dwellings in Australia had coolers, up from
59% in 2005. However, this dependency on air-conditioning overloads the power
grid and results in power outages during heatwaves as observed during 2009 and
2014 heatwaves in Melbourne and Adelaide. Therefore, it is crucial to ensure
that the dwellings are thermally comfortable in the absence of air-conditioning
during a heatwave period.
The implications of existing building design in the face of the warming
climate are clear from studies that analysed and modelled previous warm weather
events. This report briefly discusses the results of the following two research
projects into heat stress:
- a simulation of how occupants of houses with different building
energy efficiency would cope with the Melbourne heatwave event that occurred
between 28–30 January 2009;
- a 2018 paper that assessed cooling consumption, peak cooling
demand and the risk of indoor overheating for typical single-storey homes in
Adelaide and Sydney.
For the Melbourne study, the relationship between the ability of a
building to mitigate heat stress in the absence of air-conditioning and
heat-related mortality and morbidity was examined. Houses with different
NatHERS energy ratings were assessed with reference to two indices for
measuring heat stress: the WetBulb Globe Temperature (WBGT) index and the
Discomfort Index (DI).
The study found that for a typical duplex house, the occupants of 0.9 star
houses experienced extreme heat stress condition for almost 25 hours under the
WBGT index and 17 hours according to the DI heat stress index. Occupants of 5.4
star houses were exposed to extreme conditions for only 6 hours (WBGT index) or
3 hours (DI).
The heatwave event resulted in excess mortality of 374 deaths (that is,
374 deaths in addition to what would otherwise be expected at that time).
The study concluded, however, that upgrading building energy ratings would have
a significant impact on related mortality and morbidity. Assuming that the
occupants of 0.9 energy star houses were the victims of the 2009 heatwave
event, the analysis determined that if all Melbourne homes had at least a 1.8
star energy rating, the number of excess deaths from a 2009-type heatwave would
be reduced to around 240. This would reduce further to 37 if all houses could
be upgraded to a minimum of 5.4 stars.
In addition to projected reductions in mortality, corresponding reductions
in heat-related morbidity and pressure on the health system were also
identified. The results of the analysis are summarised at Table 6.1.
Table 6.1: Predicted health
impacts of a heatwave based on the 2009 Melbourne event in different energy
Emergency department presentations
After hours doctor consultations
Centre for Sustainable Infrastructure, Swinburne University of Technology, Submission
9, p. 4.
The 2018 paper analysing typical houses in Adelaide and Sydney focused
on whether the NatHERS energy efficient design requirements increased heat
stress resistance. House design options of 6–8 stars as well as two types of
traditional, energy-inefficient homes were simulated.
The results of the Adelaide analysis included the following
The cooling consumption of a home with 6 stars (49.1
MJ/m2/year) can be nearly the same as an energy-inefficient, double-brick home
with 2.6 stars (50 MJ/m2/year). Meanwhile, a design option with 7.2 stars
(41.4 MJ/m2/year) used significantly more energy for cooling than one with
only 6.2 stars (25.1 MJ/m2/year). Similarly, a home with 8.0 stars
(22.7 MJ/m2/year) used nearly twice as much energy for cooling as a home
with 7.1 stars (11.6 MJ/m2/year).
For Sydney, the analysis found that all homes with 5.6 stars and above
were within the maximum heating and cooling thresholds, and that the two types
of traditional homes were within the maximum cooling threshold. The study also
found that a 6.9-star home had higher cooling energy consumption than a
2.3-star double-brick home, and that the 5.7 star and 7.9 homes examined used
the same amount of cooling energy. The paper concluded that 'the star rating
did not indicate the cooling energy consumption of a building either in
Adelaide or Sydney'.
Particular implications for vulnerable households
Submissions also noted that certain categories of households are more
likely to experience climate change-related risks as they generally live in
lower quality housing. Some of these categories include:
- low income homeowners who cannot afford to retrofit their
existing house or purchase similar priced housing with better energy
- renters who cannot influence their landlords to improve the
efficiency of their building or are unable to move to more efficient
residents in public housing.
Low socioeconomic status homeowners
As noted above, low income homeowners may not be able to afford to
retrofit their existing house or move to similar priced housing that would have
lower heating and cooling costs as a result of better energy efficiency. It was
also suggested that appropriate retrofitting efforts to make a house more flood
resilient or energy efficient might, in addition to cost, be beyond the
knowledge of some homeowners.
Government programs to address residential energy efficiency have
directly targeted low-income households, such as the Low Income Energy Efficiency
Program operated by the Australian Government between 2011 and 2016.
Thirty-one per cent of Australian homes are rented.
The committee was referred to a 2013 report which found that Australia's
rental housing 'is poorly adapted to climate change, incorporates the lowest
quality housing which is over represented by low income earners, and is the
most vulnerable to climate change'.
The City Futures Research Centre at UNSW advised that a research project
into the barriers to low carbon living that low income individuals encounter
found that the most significant of the housing-related barriers identified
related to 'the prevalence of split incentives in the rental sector'. The
Centre explained that landlords are often unwilling to implement efficiency
upgrades as 'the benefits of their capital investments would be reaped mostly
(if not solely) by the tenant'. The Centre continued:
This issue especially disadvantages lower income households
who are more likely renters than owner-occupiers and, without explicit
cooperation from the landlord, are left with few recourses to protect
themselves from climate change and extreme weather events even if they have the
financial means to do so. One of our participants illustrates the situation: "the
landlord wasn't interested in insulation. We offered to put solar panels on but
he wouldn't hear of it, and he wasn't interested in insulating the ceilings
which is a pity" (older couple in private rental, Tasmania).
Hobsons Bay City Council noted that recently arrived migrants who are
renting are also at a disadvantage, as they will need to learn about the need
for efficiency measures in the Australian climate as well as their rights as
Concerns about public housing centred on older public housing stock that
is poorly designed and maintained, and/or when public housing residents are
unable to pay for air conditioning.
The South East Councils Climate Change Alliance (SECCCA), which represents
several councils located south east of Melbourne, submitted that studies reveal
'50,000 public housing properties in Victoria fail to meet energy efficiency
standards indicating that public housing tenants are less able to adapt to
rising energy, water prices and contribute to climate change mitigation'.
The NCCARF submitted that retrofitting, and the use of features such as
cool refuges, could be pursued in response to these problems. The NCCARF
Retrofitting (e.g. to improve thermal performance) can be
prioritised, and will provide value in reducing the climate risk. Particular
care needs to be taken in the design and management of public housing for
Indigenous Australians, to ensure it is appropriate with respect to cultural
practices and to the often-extreme climatic conditions experienced by those
living in regional and remote locations.
External building features and landscapes can be an important
contributor to improving resilience for public housing (e.g. cool refuges,
flood protection) and should be considered in public housing design. External
cool refuges, which may be swimming pools, are of particular importance in
heatwaves, providing respite to residents unable to afford mechanical cooling
or who are more vulnerable to heat stress.
The committee was advised of projects underway to retrofit existing
public and social housing to better withstand current climatic conditions. An
example put forward is the Cooling Communities initiative undertaken by the
City of Moreland with an $80,000 grant from the state government.
The Northern Territory Government advised that guidelines and
recommendations have been developed for public housing it supplies 'to promote
site‑responsive passive designs suitable for Northern Territory climate
zones'. The Government submitted that it 'acknowledges that climatically
appropriate design is integral to the liveability and sustainability of urban
and remote public housing dwellings'.
Suggestions for change
In response to the issues identified with the design of individual
houses and other buildings, stakeholders put forward suggestions regarding
changes to building standards and providing incentives for homeowners to
improve the efficiency of their dwellings.
Building standards and measuring
The benefits of a nationally consistent approach to construction
regulation were recognised, with Green Building Council Australia
characterising Australia as being 'fortunate' to have the NCC in place.
Similarly, the HIA advised that the NCC 'is seen as the benchmark by many
overseas countries with respect to the technical construction standards it has
established, particularly regarding building in bushfire- and cyclone-prone
Other recent improvements were also noted, such as the Victorian Government's Better
Apartments Design Standards.
Despite these positive comments about the NCC and building practices
more generally, many stakeholders argued that strengthened or additional
minimum building requirements are required to adapt to the effects of climate
change. This evidence is discussed in the following paragraphs.
reconsider minimum building requirements
Several submitters highlighted that existing building standards
prescribed in the NCC are not suitable for extreme climate events associated
with climate change. For example, the NCCARF submitted:
Much of Australia's housing stock does not meet existing
building standards and can be poorly designed for extreme climate events (e.g.
heat, cyclones). Building guidelines currently use historic climate conditions
to evaluate the energy demand and performance of a building, and these are
unlikely to be adequate for future climate conditions. We do have a reasonable
understanding of design features that can target heat reduction
(e.g. orientation, shading, provision of appropriately sized eaves, light
colours, reflective roofing, inclusion of a cool refuge, complimentary
landscaping) but these are not formalised into the National Building Code.
The NCCARF added that, despite the engineering-based standards
introduced following Cyclone Tracy to improve the resilience of buildings to
high wind speeds, there is '[s]ome evidence that modern housing may not be
performing as expected under the Code'. The NCCARF suggested that ongoing
review of the NCC 'is required to ensure that new buildings can withstand
present-day and likely future high windspeed events'.
The Climate and Health Alliance also noted that previous papers and
public inquiries have highlighted gaps in the NCC, including that the Code does
not include design measures for buildings to withstand hail, storm tide or heat
IAG also recognised that the current building code might 'not be
adequate to meet the risks of future extreme weather events'. IAG submitted:
It is important that research is conducted into both the
drivers of damage to buildings as well as improved understanding of the
potential changes to extreme weather events so that building codes are more
effective in managing future community risk. Providing upfront protection of
assets, buildings and infrastructure minimises the impact to community post
disaster. This is an issue now and will only increase in its impact to
communities as we see an increase in more extreme weather events.
Apparent issues with the NCC relating to health attracted significant attention.
The Climate and Health Alliance argued that the study of Melbourne housing
based on the 2009 heatwave event (see paragraphs 6.17–6.19) indicates that the
Building Code of Australia, which forms two volumes of the NCC, is deficient
with respect to extreme heat.
Similarly, the authors of the 2018 study of heat stress-resistant
building design in Adelaide and Sydney homes (see paragraphs 6.17 and 6.21–6.23)
concluded that overreliance on air conditioning can present a public health
hazard and that integration of heat stress resistance in the NatHERS should
occur. The researchers argued that, at present, energy efficiency schemes
such as NatHERS 'can be potentially counterproductive to heat stress
resistance'. A result that particularly supports this conclusion is the finding
from the Sydney analysis that although all homes with 5.6 stars and above
were within the maximum heating and cooling thresholds, the two types of
traditional homes were also within the maximum cooling threshold.
The researchers described this as an unexpected result that highlights
that the cooling threshold requirement 'is lenient'.
Overall, the authors of the study concluded:
...NatHERS does not directly encourage heat stress resistance
in new homes and can even deliver buildings with worse heat resistance than
traditional, energy-inefficient buildings. Current building construction
methods, compliant with the NatHERS, rely greatly on AC, thus increasing the
population's dependence on it. New homes can potentially be more hazardous
without AC during heatwaves than traditional, double-brick buildings.
Consequently, the risk exists that the NatHERS, without modification, can
adversely impact on human health during heatwaves. Energy efficiency and heat
stress resistance can be both achieved in the design process. A design approach
that considers both aspects is recommended, particularly considering future
increases in the vulnerability of the population and climate change. 
The study recommended that heat stress-resistant measures should be
implemented in NatHERS to 'decrease risks associated with the population's
dependence on [air conditioning], ensure a thermally safe indoor environment
and reduce pressure on electricity prices'.
Further research into Australian building practices and how the NatHERS affects
heat stress resistance was also suggested.
Evidence from the City of Melbourne supported the researchers' concerns
about the relevance of NatHERS for heatwaves. Mr Gavin Ashley, who leads the
City's climate resilience team, commented:
Where the Building Code currently sits, the six-star minimum
standard for NatHERS is not sufficient in its ability to address heatwaves in
particular. It's based on year-round energy use and splits that between your
cooling and heating requirements. That doesn't give a great indication of how
your building is going to perform in a heatwave. Additional guidance, which
essentially puts buildings through a model that allows us to understand what
the internal thermal comfort conditions are going to be during a heatwave, is
critical to understanding how the building is performing. That's not
currently a metric that's included in the Building Code. In order for us to
plan properly and for developers to get it, it needs to be.
To address heat stress risks, Green Cross Australia argued that a heat
stress building code needs to be developed and 'that available disparate
knowledge about effective responses to heat is integrated and combined with
guidance material to support users'.
The Australian Health Economics Society suggested that building design and
building codes for housing and commercial premises should 'emphasise passive
cooling and to minimise heat gain when air conditioning is not available
(e.g. due to power supply disruption)'.
Work that has been undertaken on bushfires and wind loading was noted,
although it was acknowledged that further work could be undertaken in response
to extreme weather conditions. Standards Australia submitted:
As a result of extreme weather conditions and technological
shifts, there is further scope for standards development in key areas, ensuring
that the infrastructure we build remains future-focused and responsive to our
Other stakeholders supported reviewing and revising building standards,
including the NCC, to improve the energy efficiency of buildings and resilience
of housing design to climate change risks.
In particular, Green Building Council Australia argued that the minimum
standards in the NCC regarding energy efficiency should be updated more
frequently. The Green Building Council submitted:
The gap between minimum practice outlined in the NCC and best
practice grows wider by the year. Lifting minimum standards for energy
efficiency in the NCC will ensure that new buildings in Australia do not miss
opportunities for emissions reduction, as well as creating opportunities to reduce
running costs over the life of buildings.
The Green Building Council added that a 'goal of net zero emissions for
the NCC supported by a trajectory of planned updates over time will encourage
innovation and regular upskilling of industry, and deliver more high performing
Similarly, the ASBEC called for a national plan to be established to move
towards zero carbon buildings by 2050.
The New South Wales' Young Lawyers Environment and Planning Law
Committee argued that Australian Standards 'should include preventing property
damage occasioned by climate change as part of their goals, to the extent that
this would help to protect lives'. Furthermore, although it was acknowledged
that there are difficulties in updating Australian Standards 'where future
impacts of climate change are uncertain', it was argued that updates could be
progressed based on a precautionary approach that considers worst-case
scenarios using 'best practice scientific data'.
The Australian Sustainable Built Environment Council (ASBEC) described
the building regulation and standards development processes as 'slow and
reactive'. It noted that this 'is perhaps understandable, considering that
changes to these documents are required to be supported by evidence, cost-effective,
and subject to regulatory impact assessment'. Nevertheless, the ASBEC argued
that 'regular review processes are needed to enable building codes and
standards to reflect, in a timely way, new climate change research and industry
Finally, it was suggested that, at least in some jurisdictions, it would
be desirable to confirm that the energy ratings indicated at the outset of new
developments are actually achieved. The Western Australian Local Government
Association argued that occupancy certificates required for single residential
properties should 'confirm that the Energy Rating prepared at the start of the
project, has actually been achieved once the build is completed'.
Work currently underway and need
for further research
The appropriateness and effectiveness of current building standards from
a climate change perspective has been the subject of policymakers' attention
recently. Mr Michael Roberts from the HIA explained that there are currently
three reviews considering the future benchmarks that should be set for housing.
In addition, Mr Roberts noted that the NCC is due to be amended in 2019
and will be reviewed again in 2022. In summary, Mr Roberts noted that these
reviews indicate there is 'a continuing discussion about how buildings
need to improve'.
The ABCB is also undertaking work and monitoring developments in this
area. The Chief Executive Officer of the ABCB, Mr Neil Savery, explained
that the Board 'continues to monitor events and the science of climate change
to determine if any further changes to the NCC are warranted'.
In support of this statement, Mr Savery referred to a 2014 paper
produced by the ABCB which 'explores what natural hazards might be relevant to
the NCC, the challenges that they present and the boundaries within which the
ABCB has to operate'. On heat stress, the paper concluded that it is an area
'where further analysis was warranted, which resulted in its consideration as
part of the board's current work in updating the NCC's energy efficiency
provisions for 2019'. Mr Savery advised that the approach being taken by the
...draws a strong correlation between improving the performance
of a building's energy efficiency with providing a more comfortable environment
for occupants in extreme temperatures. This includes the introduction of split
heating and cooling loads, as part of the proposed changes for NCC 2019, to
improve the passive performance of buildings in extreme temperatures as well as
reduce greenhouse gas emissions from artificial heating and cooling.
Mr Savery added that further work on energy efficiency involving NatHERS
and BASIX 'is anticipated to be undertaken for the NCC...which, subject to the
modelling from the current work, may result in the consideration of additional
cost‑effective measures'. Mr Savery explained that the proposed change to
the NatHERS software would shift the refocus of NatHERS from keeping homes warm
to ensuring the home is suitable for all seasons; that is, a minimum
performance requirement equivalent to six stars would need to be achieved in a
house every day of the year.
Although the ABCB is having regard to heat stress issues as part of its
energy efficiency work, Mr Savery nonetheless emphasised that there is no project
in the ABCB's work program at present 'that is specifically related to heat
stress'. Mr Savery further added that if the energy efficiency project does not
sufficiently address the issue of heat stress, then it would be proposed to the
Board that additional work be undertaken; however, this would mean that any
changes subsequently identified that met the COAG regulatory requirements could
not commence until the 2022 revision of the NCC.
It was also suggested that further research would assist policymakers in
ensuring that measures to address heat stress are effective. For example,
researchers from Swinburne University of Technology commented that research is
- how heat traps and overheating in high rated energy efficient
dwellings can be created by inadequate ventilation; and
- the behaviour of building occupants during heatwave periods.
Although most stakeholders that commented on the NCC suggested the Code
needs reviewing to ensure houses are more resilient to climate change and safer
for building occupants, some evidence was received that cautioned against
changing the overall process for updating the NCC, or which raised other issues
that should be considered.
The HIA warned against changes to how the NCC and relevant Australian
Standards are developed. The HIA observed that ensuring 'residential and
commercial buildings are resilient to natural hazards is not a new concern'.
In the HIA's view, the building industry and existing processes for updating
the NCC and relevant Australian Standards are well placed to respond to any challenges
climate change might present. In particular, the HIA emphasised that the
current process requires any proposed changes to be 'evidence-based and be
informed by Regulation Impact Analysis in accordance with COAG principles'.
How changes to building standards could affect building users on a day‑to‑day
basis also attracted comment. SECCCA noted that raising the standards of
construction in relation to energy efficiency 'may adversely impact housing
Mr Savery from the ABCB also made this point; he commented that the NCC needs
to be developed with 'regard to what society can afford to pay'. Mr Savery
Whilst it is technically feasible to build a building that in
the conditions of, say, seven consecutive days of plus-35—and possibly plus-40
in some parts of Australia—the cost of doing that for the average house would
potentially be extremely high.
Mr Karl Sullivan from the Insurance Council of Australia observed that
extreme weather events are rare and, accordingly, policymakers need to consider
not only the merits of enhanced building standards, but also their cost and
whether any everyday benefits (or detriments) would be associated with them. To
illustrate this point, Mr Sullivan commented:
An example of that is how you wrestle with the potential of
conflating sea level rise and storm surge and how buildings address the
From a simple urban design perspective, do we want to be raising buildings...above
the pavement and have all the issues that are associated with disabled access
for those sorts of buildings or are we investing in other solutions that can
occasionally see water in the streets but can give us greater amenity
throughout the 99 per cent of the year when that isn't going to be a problem?
Evidence given by the ICA indicated, however, that additional costs
could be offset by reductions in insurance premiums. To demonstrate how this
can occur, Mr Sullivan from the ICA referred to the FORTIFIED Home program
in the United States which, he explained, outline 'essentially a set of
insurable characteristics that you build into your home and you get automatic
discounts in your premium'.
Discussion of these issues also revealed seemingly contrasting views
about the purpose of the NCC. For example, Mr Sullivan advised that the
Insurance Council's position is that a building constructed to the minimum
standards under the NCC should be 'resilient or remain operational and
functional given the predictable natural perils that it may face'.
The insurance company IAG similarly argued that the focus of the NCC on life
safety is 'unquestionably vital'; nevertheless, it also considers there should
be a focus on reducing the cost of damage from natural disasters to aid
community resilience to such events.
However, the ABCB emphasised that the intention of the NCC is to protect the
occupant of the building, not the building itself. Mr Savery commented that, following
an extreme event:
Ideally, the building stands and you can go back and occupy
it. But if not, if it falls over, it's done its job. It's not about the
durability of the building.
Although several submitters consider the NCC needs to be reviewed to
better address heat stress issues, it was recognised that there are other
potential approaches. For example, rather than changing mandatory minimum
building requirements, it was noted that higher quality buildings could be
encouraged through incentives provided by insurance pricing or government
Finally, it was noted that better outcomes can be achieved by addressing
myths about minimum building requirements.
Retrofitting existing buildings and
ensuring homeowners are informed
In addition to strengthening building standards for new construction, it
was argued that heat stress risks in existing buildings need to be addressed.
For example, the Climate and Health Alliance argued that the Australian, state
and territory governments should 'identity retrofit opportunities for existing
buildings to address climate risks, including extreme heat'. The Alliance
suggested that retrofit works should 'include a particular focus on public
housing, schools and early childhood centres, as well as health and social
However, the costs associated with retrofitting are high. For example,
the Northern Australia Insurance Premiums Taskforce estimated that a retrofit
scheme for strengthening roofs for older properties in northern Queensland
could cost around $1 billion.
In Melbourne, where researchers from the Swinburne University of Technology
consider the majority of the 2.2 million homes are considered to have low
energy ratings, the committee was advised that a preliminary estimate indicates
that upgrading a dwelling from 0.9 star to 5.4 star through insulation and
sealing could cost about $5000.
It has been recognised in other jurisdictions that home and building
owners may be reluctant to spend large sums on energy improvements if they
expect to relocate in forthcoming years and the investment will not be
recovered before they sell their property.
Existing government policies
regarding energy efficiency
State governments have considered energy efficiency issues. For example,
the Victorian Government's Climate Change Framework commits to providing
financial support for energy efficiency and resilience retrofitting.
Examples of specific programs or legislative requirements include the
- The Victorian Government's Energy Efficiency Target—under this
scheme, accredited businesses can offer discounts to households and
organisations to make energy efficiency improvements.
- The Victorian Government's Residential Efficiency Scorecard—the
star ratings obtained as part of the scorecard are intended to assist
homeowners to make home improvements efficiently and cost effectively.
The South Australian Retailer Energy Efficiency Scheme—under this
scheme, accredited operators can provide homeowners and tenants with a range of
free or discounted services, including the installation of insulation, building
sealing and the installation of thermally efficient windows.
- In the Australian Capital Territory, since 2004 all homes for
sale must have an energy rating. In addition, when advertising that a dwelling
is for rent, the existing energy rating must be disclosed.
- Long-term financing arrangements for building improvements known
as Environmental Upgrade Agreements (EUAs, or Environmental Upgrade Finance in
Victoria) are available in many parts of Australia. EUAs are a local
government-based financing mechanism that help businesses access funding to
improve building efficiency.
The Australian Government has previously implemented measures designed
to encourage improved energy efficiency, such as the Green Building Fund for
commercial office buildings introduced in 2008. As noted at paragraph 6.7, energy
efficiency information is also required to be provided when commercial office
space of 1000 square metres or more is offered for sale or lease.
The Clean Energy Finance Corporation also provides finance to support the
utilisation of energy efficient technology solutions in commercial buildings
and in new and existing community housing.
Proposals to encourage retrofitting
One possible approach for improving the efficiency of older dwellings is
through the imposition of mandatory requirements. Dr Morshed Alam suggested
that greater energy efficiency outcomes could be achieved through a requirement
that houses must reach an identified star rating by a certain year.
Wesfarmers also expressed support for 'the potential establishment of minimum
energy performance standards for existing buildings'.
In particular, it was suggested that prospective buyers and tenants
could benefit if the provision of information about energy efficiency was
required for property sales and leases. The energy efficiency disclosure
requirements in place in the Australian Capital Territory (see paragraph 6.71)
was highlighted as an example that could be followed in other jurisdictions.
The precedent of requirements for the disclosure of energy efficiency
information for commercial buildings was also noted (see paragraph 6.72).
Another potential approach is through the provision of incentives and
information to encourage retrofitting and greater consideration of energy
efficiency. Submitters noted that individuals building new homes are
increasingly 'looking to build with a view to what it will cost to run homes'.
Existing homeowners may also decide to make alternations, although a range of
factors can influence such decisions. The NCCARF explained:
For private house owners, ability to respond to climate
change risks is often related to financial capacity, support networks, and
knowledge and understanding of risk. Once well-informed, private homeowners may
undertake building alterations. Past experience of an extreme event can be
motivating. Barriers to action include cost, design and construction of the
existing home, insurance limitations, and government restrictions.
The NCCARF argued that there is a need to consider 'mechanisms and
incentives to support retrofit of private housing to improve resilience'.
For new homes, RDA South West similarly argued that there is a need to develop
incentives to encourage the use of more efficient materials in new houses. In
particular, RDA South West suggested that:
- incentives could be offered to first home owners to encourage
them to build in timber;
- incentives, tax concessions and farming programs relating to the plantation
industry and for reforesting catchments to encourage 'further home cost savings
in timber or light frame homes'; and
governments could promote the use of timber frames, double
glazing, insulation and solar water in public housing projects.
Sustainable Business Australia argued that, to promote business and
civil society actions on climate risks, the Australian Government should focus
on developing financial incentives and innovative instruments that would
'continue and accelerate subsidization of energy auditing of buildings'. In
addition, it argued that taxes applied to renovation, insulation work, and
heating and cooling generally should be reduced to support improved energy
efficiency in buildings. Sustainable Business Australia further suggested that
the Australian Government could facilitate access to low interest loans,
referring to the Property Assessed Clean Energy (PACE) programs available in
the United States.
The continued use, promotion or extension of existing schemes was
suggested. The New South Wales' Young Lawyers Environment and Planning Law
Committee observed that retrofitting could be supported by promoting greater
uptake of EUAs.
The HIA argued that governments need to provide financial incentives—it
endorsed rebate schemes for energy efficiency measures in place in Victoria and
South Australia as models for providing 'a way for homeowners to tap into a
little bit of support'.
Other ideas put forward during this inquiry included:
- the development of an app to allow users to calculate the
expected cost associated with installing insulation in their house as well as
the expected savings over several years; and
- that electricity retailers include information on customer bills
that enables a simple assessment about energy use and efficiency compared to
similar households (some retailers already provide this information).
As the committee was advised that owners of heritage buildings are often
surprised that retrofitting work can be undertaken,
tailored guidance could be developed for owners of such properties.
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