Australia sees itself as having one of the most sustainable commercial property sectors in the world, but a new analysis from an HVAC climate startup has just smashed a hole in that theory.
Commercial spaces such as offices, hotels and other commercial spaces emit as many emissions as 6000 cars a year, as stated in a newly released analysis of Australia’s Worst Buildings by ConryTech.
The report says that according to data provided by NABERS (National Australian Built Environment Rating System), only 2 per cent of the 127,000 Australian offices are on schemes that track, measure and reduce energy use and emissions.
Just 2000 offices from a total of 127,000 publicly declare their energy ratings, the report said.
In hotels, the number is 65 from a total of about 9000 Australian hotels, and in shopping centres, just one tenth of gross floor areas do so
Among those, 15 of the worst performing 20 Australian buildings by annual energy use are shopping centres.
The startup says the businesses need to start opting for higher performing offices, shopping centres and hotels and choose their landlords based on their environmental impact in order to force building owners to make improvements and meet bare minimum requirements.
Sam Ringwaldt, co-founder and chief executive of Conry Tech, says that building owners should be pressured from all sides to transition to more energy efficient outcomes and invest in lowering carbon emissions.
“The government should be incentivising building owners to take every step possible to reduce emissions. As well as top-down pressure from regulators, Australian citizens have the power to enact change by staying away from our worst buildings.
“Environmental impact should be one of the biggest considerations when renting commercial space, and even a deciding factor when choosing a hotel. People can and should vote with their feet.”
Additionally, there were 19 offices in Australia with a 0 NABERS rating – buildings that are “not even good enough to get onto the scales”.
Retrofitting was particularly important, as the report found that through retrofitting, one office in Melbourne had reduced its annual CO2 emissions from 14 million kilograms to just 4 million kilograms. Also surprising were statistics that most buildings rated 5 star NABERS or higher still produce 432 tonnes of carbon dioxide every year, which would be equivalent to the emissions of 415 passenger vehicles.
The report found that more than half of NABERS-rated offices now had five star energy ratings, which meant there were little incentives for buildings to continue to improve. The startup is calling for the rating tool to make 5 stars harder to achieve or to add more stars to the scale.
“When …the standard data set is all at the top end of the curve, then something’s not right. Any normal data set should have a Z (bell curve) set distribution curve,” Ringwaldt tells The Fifth Estate.
A “carrot and the stick” approach is needed, and at the moment, “it’s all carrot”.
“When there’s nowhere for buildings to go, they can’t actually differentiate themselves very much from buildings that are doing the bare minimum.”
Ringwaldt says NABERS is very valuable, but without the ability to differentiate higher values, its usefulness may diminish.
The goalposts need to be extended to identify investors who are trying hard to differentiate themselves from the masses and adopting new technologies, Ringwaldt added. The last time NABERs extended its commercial office ratings – to 6 stars – was a few years ago.
What we can do to even out the curve
According to Ringwaldt, the reason many buildings are yet to join the rating scheme is that the scheme only gets triggered during major activity or when the asset is being sold.
“When you are just carrying on business as usual, there’s actually no compelling reason to go through the effort of certifying, so the result is a very small percentage of overall building stock has any idea of where they are from an efficiency perspective.
“Everyone that’s doing NABERS, generally speaking, is already ahead of the curve because they’ve been bothered to do it, which means people that aren’t even on a scale could have some really, really terrible buildings.
A “carrot and the stick” approach is needed, and at the moment, “it’s all carrot”.
“Studies are showing that buildings that are higher rated are worth more money – there is an economy argument. When you invest in energy efficiency, on average, your building will be worth 18 per cent more money.”
Does Singapore do it better?
But the carrot hasn’t been enough. So, there needs to be more stick.
Ringwaldt, who had worked in Singapore for more than 10 years, said the country’s Green Mark program was an example of using both carrot and the stick. The program, described as an amalgamation of Australia’s Green Star and NABERS program, required whole building certifications to be made every time major equipment is replaced.
“That was a legislative thing, so you had no choice, so as a building owner, you would have to replace your equipment every five to 10 years, so to get your building compliant, you have to at least register on the scale – and it just had to meet minimum.”
“Over a span of 10 years, I saw Singapore go from three buildings certified to 65 per cent certified, and that was five years ago. So, most buildings would probably be under that scheme now.”
Ringwaldt, who had spent time scaling up businesses in Florida and Canada, is now focusing his efforts back home in Australia to reduce HVAC emissions, which were responsible for half of a building’s annual energy use.
“From the outside, we see shiny office blocks and luxury hotels, but they are deeply flawed buildings and bad neighbours.