21 January 2011 – The federal government has released a consultation paper on the tax breaks for green buildings program which will be worth up to $1 billion. It has even provided a handy set of questions as a starting point for ironing out how things might work in practice.

Closing date for submissions is 18 February.

Consultation information sessions will be held in major cities: Melbourne on 31 January 2011, Brisbane on 1 February, Sydney on 2 February and a webinar available on 3 February 2011.

The program, expected to start on 1 July , will be part of Australia’s “multi-decade transformation towards a low carbon economy,” the paper says.

“A successful transformation will see Australia’s carbon emissions levels fall, our communities and industries adapt to the climate change impacts that we cannot avoid and new opportunities for economic growth and jobs emerge.”

The transformation will include capping emissions, placing an explicit price on carbon and energy efficiency.

The program will allow a bonus tax deduction of 50 per cent of the “cost of eligible assets or capital works invested to improve the energy efficiency of an existing building.” Among a list of questions that need to be answered are whether owners of vacant buildings could also take advantage of the program even though the prerequisite NABERS Energy assessment would not be possible  (NABERS measures actual energy use).

“One option may be to deem vacant buildings to have a certain NABERS rating (only for the purpose of this program), for example if a building was built before 1995 and has not undergone any major refurbishment since then, the building will be deemed to be having a NABERS rating of 2 stars for the purpose of this program.

Another alternative may be to require the applicant to provide a NABERS rating based on energy use data from the last time the building was occupied,” the paper says. “An exemption regime may also need to be developed to deal with other special circumstances under which buildings are not able to be rated under the NABERS.”

Among other questions that would require feedback and consultation are:

  • What is a fair way of dealing with existing office buildings that cannot be rated using NABERS Base Building rating tool because of insufficient sub-metering?
  • Is it appropriate to use NABERSWhole Building rating tool for the initial rating for this group of buildings?
  • What is a fair way to dealing with vacant buildings that cannot be rated accurately by NABERS?
  • What are the factors that should be considered in designing an exemption regime?
  • Are NABERS ratings appropriate to be used to measure and verify energy efficiency performance of the buildings for the purpose of the Tax Breaks program?
  • Are there any other measuring methodologies that should be considered? If yes, how can the credibility of these methodologies and the assessors be guaranteed?
  • Should there be a cap on eligible expenditure?

Submissions should be made to the Department of Climate Change and Energy Efficiency.

Email: taxbreaksforgreenbuildings@climatechange.gov.au See  this posting for a copy of the consultation paper including details of  information sessions.