An affordable housing development being built to eight-start NatHERS standards by community housing provider SGCH.

A recent report highlighted that poor people in America proportionally pay up to seven times more for electricity than rich people. While you would expect the percentage of income going to critical services to be higher for people on lower incomes, seven seems extreme and nearly 10 per cent of income is downright scary.

Around the same time NSW’s Building Sustainability Index – BASIX – released another tranche of data covering up until the end of last financial year. We crunched some data on the social impacts of BASIX.

In the 2014 calendar year the bottom 20 per cent of NSW (based on the SEIFA index of disadvantage) accounted for 18 per cent of the approved single dwellings that achieved a NatHERS star rating of eight or higher; almost punching at their weight. By contrast the top 20 per cent of NSW only account for 13 per cent of the dwellings achieving eight stars or higher.

From a social equity perspective this is helping to reduce the risk of fuel poverty through a reduction in likely running costs for those in higher-rated homes. Occupant behaviour and the truck-sized holes in the certification system aside, this is a positive step for the state’s most vulnerable.

Another trend helping keep running costs down for the most disadvantaged is relatively smaller houses. With an average of 60 square metres less home to heat and cool the pressure of bill shock is further reduced.

NaTHERS star equivalents and floor area by socioeconomic disadvantage.
NaTHERS star equivalents and floor area by socioeconomic disadvantage.

The most concerning statistic is that 53 per cent of new 2014 NSW dwellings would not have been permitted in other states – that is they do not meet the National Construction Code six-star minimum. That’s 6180 homes that will underperform for years to come. We haven’t looked at the 20,400 homes that did not undergo a NatHERS simulation as the data is too weak, if proportionally similar that would add an additional 10,800 substandard homes.

As concerns over housing affordability continue to remain unaddressed, increasing minimum standards for building performance is one in a suite of tools that will help move things in the right direction.

The usual industry laggards will scream about the impost on consumers yet the evidence shows that those who can most afford it are doing the least. The top 20 per cent are not pulling their weight – they account for 36 per cent of dwellings that rate four stars or less.

Innovation is the buzz of the moment and the upcoming election should bring some ambitious visions, targets and commitments from both sides (if not now then when?). While the Feds cannot directly lift the BASIX caps, through COAG they certainly possess the pathways and levers required.

With every proposal and announcement now being subjected to cost–benefit analysis, we have prepared one of our own. Albury sits on the border with Victoria and for the sake of simplicity we will suggest that it operates as one with Wodonga. We tested the hypothesis of the diffusion of innovation through proximity; did the thermal performance of homes in Albury get any better because they were adjacent to a state with a six-star minimum.


In 2006 Albury was producing buildings of a similar performance standard as the rest of NSW. By 2014 59 per cent of their homes were achieving the Victorian minimum of six stars, a further 16 per cent doing better again. As far as we are aware the economy of Albury has not ground to a halt in recent years.


The latest National Construction Code came into force a few weeks ago and won’t be updated for a further three years. Nationally, industry needs a strong roadmap. We now have one opportunity every three years and cannot afford to let it drift by with platitudes about economic stability and “not being the time to make big changes”.

Take a look at the bottom graph: between 2011 and 2014 NSW made no progress on improving the thermal performance of new single residential homes, suggesting that the majority of homes will continue to aim for minimum compliance.


We look forward to a federal election campaign comprehensively addressing the issues of housing affordability and the release of policies that will drive innovation and positive change to align with the government’s commitment to its Paris targets. If innovation is change then someone needs to propose some changes.

Andy Marlow is director at Envirotecture.

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  1. Andy, very informative. Your article is too short to tease out all problems with the house energy ratings, so I suggest only one more: given that BASIX uses an energy load calculation expressed as MJ/sq.m, the implications of your analysis are even more dire. We have understood this problem (of a failed equity provision) for many years, but to do something about it seems beyond those who should be making the decisions.

  2. Hi Andy,
    Really enjoyed this article and spurred me into action to download the data myself and have a look. It appears that the bottom 20% perform even better over the full ten years of data with 42% of 8 or more star rated houses being in these lower socio economic groups, compared to only 12% in the top 20%, quite amazing! Also, it seems that 2012 was the best performing year for star ratings, with 60% rating 6 stars or better, since then it has been a steady decline, most concerning.

  3. Andy,
    This is a very informative article. “The most concerning statistic is that 53 per cent of new 2014 NSW dwellings would not have been permitted in other states – that is they do not meet the National Construction Code six-star minimum.” I find BASIX a bit unclear when it comes to max heating/cooling energies so I find this statistic v. helpful as it illustrates how low the bar really is in NSW.