by Lynne Blundell
The stick and carrot approach is proving a good one for pushing sustainability globally. As governments around the globe respond to the climate change challenge with stricter building codes, together with incentives, green buildings and technologies are booming.
In the US, the introduction of California’s Green Buildings Standards Code is expected to result in a significant growth in green technologies and homes. A 2007 report by McGraw Hill Construction, Green Homeowner SmartMarket predicted the market for green homes to increase 10-fold over the next five years and to account for 10 per cent of all new building starts by 2010.
According to the report, green products are already used in 40 per cent of all US home renovations.
The new Californian code calls for a 20 per cent improvement in water use efficiency, 50 per cent increase in water conservation, and 15 per cent reduction in energy consumption in all new construction.
The code is voluntary until 2010, when all new construction must comply.
And the rebates are generous. One green US home in Massachusetts, reported in The Economist, had received $35,000 in government rebates, which paid for almost half the cost of going green. The owner expected to recoup the rest over five years through reduced energy bills.
Though California is the first state to adopt its own green code, cities such as New York and Chicago have their own sustainability requirements, and some US associations are pursuing national standards.
In Europe the European Union’s Energy Performance of Buildings Directive and Britain’s Code for Sustainable Homes are imposing much stricter controls on new buildings and are expected to fuel the growth of green technologies and the renewable energy sector. Countries across the EU are introducing a range of incentives to accelerate the growth.
The power of green incentives has become apparent in a range of industries.
In France, for example, a government initiative that offers consumers money for trading in an old car for a more environmentally friendly model boosted car sales last December. Based on this increase the French government estimates sales to increase by 100,000 over the year.
The European Commission recently called on its member states and industry to use information and communications technologies to improve energy efficiency, saying this could reduce total carbon emissions in Europe by up to 15 per cent by 2020.
This would happen through monitoring and management of energy use in factories, offices and in public spaces, increasing peoples’ awareness of their energy use.
According to the Commission’s report, ICT-enabled systems can reduce energy consumption of EU buildings by up to 17 per cent and carbon emission in transport logistics by up to 27 per cent.
In Australia the messages from government have been mixed.
There are incentives available but ask anyone you know what they are and odds are they won’t be able to tell you. At present there is a mishmash of rebate schemes across the states and territories and little communication about what’s available. And let’s not even mention what goes on at local government level.
At the federal level the messages regarding incentives have been mixed to say the least.
This week’s sudden cutting of the solar roof panels rebate system is a case in point. (see our recent story on this ).
The replacement of rebates with a solar credits system follows a chequered history for the Rudd government with the solar panel industry. When the Government introduced a means test to the solar panel rebate scheme soon after being voted in there was a strong industry and community reaction.
And the move backfired – on the one hand the government was talking about its commitment to renewable energy and on the other it undermined a burgeoning local industry.
Now that the industry has once again been flourishing it has been hit with another change.
If Australians’ uptake of green energy is anything to go by we are strong supporters of green technology and renewable energy. In NSW the number of households signed up for green power in the last three months of 2008 rose 17 per cent compared to the same period in 2007.
And that’s without any incentives at all – in fact it costs us more.
In the property sector, groups such as the Green Building Council of Australia and the Property Council of Australia have been calling for a better mix of incentives and regulation to promote green building development and retrofits.
Property Council CEO Peter Verwer says accelerated depreciation will unlock private capital and get it back to work by “providing both an incentive that boosts economic activity and an incentive to retro-green Australia’s 330 million square metres of existing commercial property stock, most of which is more than 25 years old.”
The GBCA wants more incentives from government to stimulate green building development and retrofits.
GBCA state manager for the ACT, Jeff House, says with vacancy rates increasing and activity in the construction sector falling as a result of the global financial crisis, the time is right for the government to introduce incentives such as stamp duty and land tax concessions, rate reductions and the abolition of change of use charges.
“These measures will also facilitate the renovation of many of Canberra’s old, environmentally inefficient commercial buildings to A-grade standard, which will improve the choice of commercial office space available in our town centres,” House says.
The ACT Government already offered stamp duty reductions for low emission, fuel efficient vehicles and this should be extended to low emission buildings.