The top leaders in the sustainability and the built environment gathered at the 2026 ARBS conference in May in an opening session to inspire decarbonisation of the HVAC&R and building services sector.
The panel lineup comprised were Climate Change Authority chair Matt Kean, Energy Efficiency Council chief executive Luke Menzel, Green Building Council of Australia CEO Davina Rooney, AIRAH CEO Sami Zheng, and engineer Mike Rainbow. It was moderated by The Fifth Estate editor Tina Perinotto.
“Buildings account for approximately one quarter of Australia’s energy usage”, Matt Kean said. “This sector is not just part of the transition, but one of its control points.”
And the benefits aren’t just energy security; moving from gas to more efficient technologies would improve indoor air quality and reduce exposure to harmful pollutants in homes and workplaces, he said.
“HVAC systems are a major driver of peak demand for our electricity energy with intensive cooling in summer and heating during winter.
“Decisions made in HVAC design and specification now shape not just individual buildings, but how resilient and affordable the whole energy system becomes for the nation.”
Kean said there are now increasing resources, capital, capability and technology to decarbonise and electrify and upgrading commercial buildings are no longer future concepts but things happening now.
Global pressures
Doubling down on fossil fuels during a fuel crisis is the definition of insanity, Kean said. And using what’s happening in the Middle East as an excuse to delay decarbonisation is ridiculous.
“Drilling oil during a fossil fuel crisis is like fixing your gambling debt by going down to the Casino. It’s just insane.”
Instead, our interest should be in supporting the building, refrigerant and air conditioning industry to bridge the gap between technologies, the green premium and fossil fuel equivalents.
“The rest of the world is decarbonising, Australia either takes advantage of this global mega trend, or we put our head in the sand and become a rust bucket state.”
The lack of a national policy
Davina Rooney said that while there was a compelling case for electrification, there was still no national policy for bringing electrification into buildings, including new buildings. This was complicated by the difficulty of retrofitting old buildings.
She said there had been a number of discussions about optimisation, but critical issues were not even on the table.
“There isn’t even a spot for them on the ledger.”
“We’re having quite a bit of trouble with the construction code at the moment. Should we optimise it? Absolutely. Should we modernise and digitise? Absolutely. But we’re going to need a plan in the code that deals with resilience.”
While the Climate Change Authority had critical recommendations about electrifying buildings by 2030, the next version of the National Construction Code for 2029 was about a tidy up, Rooney said.
“While it’s important, we have a tidy up, we’re in a climate crisis. We really need to be able to whistle and walk.”
Because work wasn’t done on climate mitigation, there is now a lot of resilience work to be done, and that framework needs to be looked at, Rooney said.
People should be looking at what can be changed. We needed systems so that “when that hot water system breaks, they can do the change then, because nobody wants to buy it twice”.
Catching both waves
Decarbonisation was critical, Luke Menzel said. But at the same time, we need to catch the renewables wave in every secular economy of electrification, which is much more complex.
While the electricity system was heavily regulated, when it came to buildings, manufacturers, households, agriculture and resources, the different sectors all have different technology, drivers, barriers, and needs, detailed policies.
“We still haven’t got clarity from any state or federal government, except for the ACT government, about the future of the gas network.
“ACT said [gas] is shutting down in 2045, without spending a dollar, without putting any regulations in place. That’s a very clear signal to households and businesses in the ACT that you’re investing in a new heating system, which should be electric, because there’s going to be something to plug into for the foreseeable future.
“I think that many of our political leaders did not want to touch the elephant in the room, which is the future of gas in our economy.”
There were multiple issues in the gas debate, including the industries’ need for the fuel with high-temperature processing, Menzel said. There’s a complex question around the role of gas exports and their impact on the economy, and politicians are cautious about that.
“In the built environment, there is some of that complexity, but in that sector, there are affordable technologies that will leave you better off on day one if you can find the right point in the capital replacement cycle right now.
“But politicians aren’t necessarily comfortable having that conversation.”
HVAC is now coming into the mainstream
With thousands in attendance at the conference, HVAC was no longer invisible, Sami Zheng said. It now sits at the centre of net-zero delivery.
And there were low hanging fruits to be addressed, especially in performance gaps – which was the difference between the building’s actual energy use and its intended energy use. And currently, the gap is sitting between 10 and 30 per cent, and some buildings are sitting even higher, Zheng said.
There were financial and environmental incentives to close the gap. But the gap occurred in the life cycle of the building, and at the design stage, at commissioning and in ongoing maintenance and operational optimisation.
But another concern was jumping on board the optimisation train without systems thinking, Zheng said. Especially in residential areas, there were millions of households with varying ways of using their energy.
We need to reward good behaviour, so instead of just rewarding a reduction in overall energy use, we should also consider rewarding the reduction of peak energy use, Zheng said.
“We also should be thinking [that] the HVAC in our system should be more grid smart. We should be able to integrate our system with renewables. We should have a better response to demands – and there are a lot of technologies available for use to use for that.”
But the industry was risk-averse, Zheng said. We should be, she added, because the responsibility was to provide a healthy and safe environment for the occupants. The reason technologies aren’t getting adopted is that there is still no data that “tells the whole story.”
Refrigerants
An example was the refrigerant transition. With refrigerants part of long-term infrastructure, which only experiences a refrigerant leak at the end of its life cycle, not planning for it can lock in long-term risk, Zheng said.
Engineers were pragmatic, but there needed to be an uplift in competency when it comes to handling flammable refrigerants. Systems need to be redesigned to put people first.
“It’s not moving as fast as we hope to,” Zheng said. And that’s why governments should consider leading pilot programs, where projects can be controlled, measured and experimented with, so it increases people’s confidence.
Mike Rainbow said the rollout of mandatory NABERS disclosure is what he was most excited about.
“It’s a whole new universe around the world”, especially when the real estate agents now have a significant interest in energy performance.
Great things are happening, Rainbow said, especially in NSW, where a consultation document recently looked at the importance of making conditions better for renters.
What doesn’t excite him, however, is the lack of uptake of the NCC 2025. Being from the UK, Rainbow said he couldn’t imagine a time “where the building code doesn’t update on schedule”.
