A newspaper article has attacked BASIX target increases as a “blow to home affordability”.

23 January 2014 — Housing experts have attacked negative media spin on NSW’s Building Sustainability Index rule revisions for housing standards. The article, published by Fairfax, argued that increases in capital expenditure caused by strengthening energy, water and thermal comfort targets would outweigh benefits. This is in direct opposition to a government cost–benefit analysis finding the move would add over half a billion dollars to the NSW economy and also create utility bill savings for householders, especially in the area of energy.

The article, Cost increases as BASIX rule revisions hit homes, published in hard copy on 21 January in Fairfax Media, stated that homeowners would have to pay up to $8000 more “in a further blow to home affordability”.

The Allen Consulting Group was commissioned by the NSW Department of Planning and Infrastructure to do a cost–benefit analysis of the proposed changes to BASIX, with net benefits found to total $511.7 million dollars.

Aggregate lifetime savings were estimated at 328 gigalitres of water, 7763 gigawatt-hours of electricity and 25,908 petajoules of gas.

Aside from energy and water savings for homes, other indirect benefits included:

  • indirect benefits of potable water savings, including offsetting infrastructure upgrades
  • reduced peak load infrastructure demands
  • abatement of greenhouse gas emissions
  • health improvements
  • improved amenity values
  • noise reductions
  • environmental benefits including increase in water catchment flows

Benefits would also flow to those in the industry providing energy efficiency and water saving technology.

The report found that increases in capital expenditure on properties would in most cases be “more than offset” by lower utility bills, and taking into account increased mortgage payments, a net saving of $32 a year was still found (using a standard variable rate of 6.45 per cent a year), with increased savings as utility costs increased.

However, the media article stated that, taking into account the “current record low standard variable rate of 5.88 per cent”, homes would be on average $8 a year worse off in order to increase water and energy efficiency by an average 10 per cent.

The article then documented the increased capital costs of meeting this standard without mention of associated savings.

Sid Thoo

Newly appointed chair of the Association of Building Sustainability Assessors Sid Thoo said opposition to minimum standards for sustainability was a national phenomenon that could be seen in newspapers around the country, and that the housing affordability angle, couched in terms of increased capital expenditure, was routinely seen when increased standards were sought.

He said, however, that numbers and data could always be manipulated to get the answers you wanted.

“I can show you there is a very small cost increase to get some big outcomes,” he told The Fifth Estate.

“Often when we talk about housing affordability, we fall into the trap of looking at capital expenditure, not realising you’ll end up with a house that can’t be cooled or has huge heating bills in winter.

“This creates cost of living stress, and this financial stress can lead to missed mortgage repayments.

“You need to look at the big picture to get the full story.”

Caroline Pidcock

Leading sustainable architect Caroline Pidcock agreed.

“I don’t see there’s a problem,” she said. “If you are designing good houses, the cost impact is pretty minimal, because it’s only a cost impact if you’re turning a really bad design that’s inappropriate for its environment into something liveable.”

The bare minimum, she said, was providing liveable houses, and that it was “beyond belief” in this day and age that anyone thought it was acceptable to build something that required excessive amounts of heating and cooling to make it liveable.

With the issue of changing climates now a lived experience for many, and predicted to get worse, people arguing against sustainability measures was tantamount to people arguing against making a building waterproof or structurally sound, she said.

“They really can’t argue the numbers, either,” she said, stating that these arguments were being put forward by people looking backwards not forward.

“Climate change is going to create much more intense weather conditions and we need to draw a line in the sand,” Ms Pidcock said. And base levels of comfort were crucial to providing resilience to climate change.

Ms Pidcock noted that compared with Europe, the standards proposed were much less stringent and it was simply not acceptable to be arguing against these standards, which she said might explain why no person was quoted in support of the assertions in the Fairfax Media article.

Some concerns around water

The changes to BASIX, however, do have critics within the sustainability arena, with concerns that some proposed measures are impractical.

Dr Shaila Divakarla

Dr Shaila Divakarla, who is a Greensmart advisor for energy efficient housing company Ichijo Australia, said that although she strongly supported the higher energy standards in the new BASIX rules, she was very concerned about the increases to the BASIX water targets, and the cost burden for house buyers of this change.

For the average new dwelling to go from a BASIX 40 to a BASIX 50 target, instead of a 2000-litre water tank, an 8000L water tank may be required, according to the target review overview.

Dr Divakarla said most new buildings could accommodate around a 3000-3500L water tank, but that an 8000L tank was too large.

“It’s both an issue of cost and space,” Dr Divakarla told The Fifth Estate.

Planning subdivisions were getting smaller and an 8000L tank would take up a huge chunk of space in the back yard. If you decided to install the tanks underground, this would “easily” be a minimum of $7000 extra.

For Ichijo, she said two of their 4000L slimline tanks could be installed (slimline tanks come in capacities up to 5000L), but that would add at least another $2000-$3000.

It would also necessitate a long wall for them to be put against. But with people wanting more windows and an indoor–outdoor connection, this would not be ideal, she said.

Dr Divakarla said she was surprised that the cost–benefit information she saw “lumped water, energy and thermal comfort together”.

Were there a breakdown, she said, it would most likely be seen that water tanks were not a cost-effective addition to a house, particularly since the cost of mains water was so low.

She said this was the experience with her work on the Ecoliving display village project with Landcom and Clarendon Homes.

While water saving and management were obviously important, Dr Divakarla said residential water recycling schemes such as the Rouse Hill Recycled Water Plant would be a preferable solution, rather than requiring individual houses to install tanks.

“Most builders would be of the same opinion,” Dr Divakarla said. “[Ichijo] build efficient homes and we have issues [with the proposal].”

She said she has provided her critique to the Housing Industry Association for a submission to be made regarding the increased water requirements.

She said she was happy with the energy and thermal comfort requirements being raised, and that if the water requirement was reduced the energy performance could potentially be raised further.

Submissions to the BASIX target review are open until February 14.

22 replies on “Critique of BASIX review hits the mainstream”

  1. Fantastic article and definitely the embodied energy of construction (thank you Anthony) needs to be considered sometime soon in BASIX. The UK Royal Institution of Chartered Surveyors’ ‘Methodology to calculate embodied carbon of materials’ 2012 may be a first step in persuading policy framers that the demolition of buildings has a cost, and these costs may take many many years of energy savings to offset. The churn in housing (and commercial buildings, let alone their fitouts) is of huge environmental concern.

    I also like the comments regarding smaller dwellings as being a substantial contributor to energy and water savings, (I’m so in favour – small is beautiful) but I presume there may still be substantial taxation and revenue reasons for larger houses, so until BASIX makes bigger harder, bigger will continue to dominate.

  2. Fantastic article and definitely the embodied energy of construction (thank you Anthony) needs to be considered sometime soon in BASIX. The UK Royal Institution of Chartered Surveyors’ ‘Methodology to calculate embodied carbon of materials’ 2012 may be a first step in persuading policy framers that the demolition of buildings has a cost, and these costs may take many many years of energy savings to offset. The churn in housing (and commercial buildings, let alone their fitouts) is of huge environmental concern.

    I also like the comments regarding smaller dwellings as being a substantial contributor to energy and water savings, (I’m so in favour – small is beautiful) but I presume there may still be substantial taxation and revenue reasons for larger houses, so until BASIX makes bigger harder, bigger will continue to dominate.

  3. Hi Dick,

    Good to hear from you. My comment on small lots was not specific to Ichijo but in general (particularly with my experience with project builders) as housing lots are getting smaller with 450m lots being the typtical lot with other lots smaller than that. Definitely houses should not be as big as they are currently, and I am all for smaller and smarter homes, but unfortunately the market demand is otherwise. Sadly, that is the reality.

  4. Hi Dick,

    Good to hear from you. My comment on small lots was not specific to Ichijo but in general (particularly with my experience with project builders) as housing lots are getting smaller with 450m lots being the typtical lot with other lots smaller than that. Definitely houses should not be as big as they are currently, and I am all for smaller and smarter homes, but unfortunately the market demand is otherwise. Sadly, that is the reality.

  5. I agree with Steve King – the benefits of implementing the proposed upgrading to the Basix system have benefits to both the occupiers of new houses – reduced energy,water bills and the whole of society with savings on infrastructure -congratulations to the Basix unit for proposing this upgrade -we just now need to make sure it happens.
    Cutting down on house size is a sure way to cut costs.
    Be small but be efficient.
    It is essential that we continue to improve the sustainability in housing in this country to come into line with other advanced countries throughout the world

  6. I agree with Steve King – the benefits of implementing the proposed upgrading to the Basix system have benefits to both the occupiers of new houses – reduced energy,water bills and the whole of society with savings on infrastructure -congratulations to the Basix unit for proposing this upgrade -we just now need to make sure it happens.
    Cutting down on house size is a sure way to cut costs.
    Be small but be efficient.
    It is essential that we continue to improve the sustainability in housing in this country to come into line with other advanced countries throughout the world

  7. Basix reducing housing affordability? This is a furphy: after land value, the biggest impact on housing affordability is dwelling size and expectations of luxury inclusions from those who can’t afford it. With the average floor area of detached housing increasing from around 170m2 in the early 80s to 280m2 now, the simple answer to affordabiity is modest house size and less flashy finishes. Also, reduced energy and water costs contribute to on-going housing affordability. This applies even more so to first home buyers.

  8. Basix reducing housing affordability? This is a furphy: after land value, the biggest impact on housing affordability is dwelling size and expectations of luxury inclusions from those who can’t afford it. With the average floor area of detached housing increasing from around 170m2 in the early 80s to 280m2 now, the simple answer to affordabiity is modest house size and less flashy finishes. Also, reduced energy and water costs contribute to on-going housing affordability. This applies even more so to first home buyers.

  9. Plus – the criticism (not a logical critique) of the long overdue BASIX upgrade is not unexpected, and can I think be largely discounted as just another whinge about threat to profit, not affordability.

    What may be seen as surprising is Shaila’s worry about water tanks. Water tanks are not the panacea to all ills of water sustainability, and certainly on small lots (where Ichijo have a strong market) they may be problematic. But on lots of 600m2 or more they are not a problem.

    The question is how is the water used (ie, get it to do some heavy lifting), and is the certification & inspection process effective in ensuring As Built is as per the BASIX Certificate? Currently that is a dog’s breakfast of non-compliance.

  10. Plus – the criticism (not a logical critique) of the long overdue BASIX upgrade is not unexpected, and can I think be largely discounted as just another whinge about threat to profit, not affordability.

    What may be seen as surprising is Shaila’s worry about water tanks. Water tanks are not the panacea to all ills of water sustainability, and certainly on small lots (where Ichijo have a strong market) they may be problematic. But on lots of 600m2 or more they are not a problem.

    The question is how is the water used (ie, get it to do some heavy lifting), and is the certification & inspection process effective in ensuring As Built is as per the BASIX Certificate? Currently that is a dog’s breakfast of non-compliance.

  11. I agree re a materials impact rating – we have to start focussing on this. As operational energy reduces, embodied energy becomes the next big thing to control. The various LCA tools and the BPIC LCI give us a wealth of information now – but is largely unused.

    And building longevity is the elephant in the room – and is subject to both consumer whim and the forces of urban renewal (well planned or otherwise!). For instance, a thermally and energy efficient brick building with double glazed thermally broken aluminium frames has a high carbon debt to repay, and if given a long life and used well, will certainly repay that. But if it only lasts 20 years before the site is redeveloped (for whatever reason), that debt gets added to whole and we continue to go backwards.

  12. I agree re a materials impact rating – we have to start focussing on this. As operational energy reduces, embodied energy becomes the next big thing to control. The various LCA tools and the BPIC LCI give us a wealth of information now – but is largely unused.

    And building longevity is the elephant in the room – and is subject to both consumer whim and the forces of urban renewal (well planned or otherwise!). For instance, a thermally and energy efficient brick building with double glazed thermally broken aluminium frames has a high carbon debt to repay, and if given a long life and used well, will certainly repay that. But if it only lasts 20 years before the site is redeveloped (for whatever reason), that debt gets added to whole and we continue to go backwards.

  13. Thank you for your response WW. You mention that re LCA some of the most popular choices come out pretty badly. But don’t they come out better than their ‘not sustainable’ competitors? Plus LCA is supported by the two major certificaion schemes in Australia and the GBCA. Can’t all be that bad. I believe that we still need to take steps forward rather than waiting for the ultimate solution as those steps forward are better than nothing and could lead us down a better path towards the ultimate solution.

  14. Thank you for your response WW. You mention that re LCA some of the most popular choices come out pretty badly. But don’t they come out better than their ‘not sustainable’ competitors? Plus LCA is supported by the two major certificaion schemes in Australia and the GBCA. Can’t all be that bad. I believe that we still need to take steps forward rather than waiting for the ultimate solution as those steps forward are better than nothing and could lead us down a better path towards the ultimate solution.

  15. Did I read correctly that the criticisms are based on an analysis saying households would be $8 a year worse off to achieve 10% improvements in water and energy efficiency? Two and a half cups of coffee or half a packet of ciggies? Per year?

    The ‘whole of society benefit’ study was first done by Victoria some years ago and came to a similar conclusion to that of the NSW study. Most such studies come to the same conclusion. For the simple reason that anything that finds itself going into buildings has a huge multiplier in increased economic activity, while creating savings for both individuals and in things like infrastructure financing.

    In Europe, the building industry is an enthusiastic supporter of raised standards, not just for new work, but for retrofit. They understand that it is the best driver for continuity of business in the long term. Contrast that with the attitude of our building peak bodies, winging about the marginal cost of sustainability measures as a putative affordability issue. Don’t these people get it?

    Much more worth of investigation is that arguably, in NSW apartment design has become almost insensitive to genuine BASIX assessments, for a combination of reasons unrelated to the underlying metrics. It has much more to do with the quality of assessments, the impunity with which badly flawed assessments can be submitted with DAs, and with seriously dodgy certification. I am not sure whether the same is true for houses as well. It calls into question whether we are actually achieving the benefits of projected efficiencies.

  16. Did I read correctly that the criticisms are based on an analysis saying households would be $8 a year worse off to achieve 10% improvements in water and energy efficiency? Two and a half cups of coffee or half a packet of ciggies? Per year?

    The ‘whole of society benefit’ study was first done by Victoria some years ago and came to a similar conclusion to that of the NSW study. Most such studies come to the same conclusion. For the simple reason that anything that finds itself going into buildings has a huge multiplier in increased economic activity, while creating savings for both individuals and in things like infrastructure financing.

    In Europe, the building industry is an enthusiastic supporter of raised standards, not just for new work, but for retrofit. They understand that it is the best driver for continuity of business in the long term. Contrast that with the attitude of our building peak bodies, winging about the marginal cost of sustainability measures as a putative affordability issue. Don’t these people get it?

    Much more worth of investigation is that arguably, in NSW apartment design has become almost insensitive to genuine BASIX assessments, for a combination of reasons unrelated to the underlying metrics. It has much more to do with the quality of assessments, the impunity with which badly flawed assessments can be submitted with DAs, and with seriously dodgy certification. I am not sure whether the same is true for houses as well. It calls into question whether we are actually achieving the benefits of projected efficiencies.

  17. Good point Anthony, but when you compare the ‘sustainability’ of building materials via LCA some of the most popular choices come out pretty badly – and the industries that produce/promote them have loud voices and deep pockets. I would not be expecting material sustainability to be a factor anytime soon. Much easier to talk about operational energy than embodied energy (smaller yes, but still important).
    WW

  18. Good point Anthony, but when you compare the ‘sustainability’ of building materials via LCA some of the most popular choices come out pretty badly – and the industries that produce/promote them have loud voices and deep pockets. I would not be expecting material sustainability to be a factor anytime soon. Much easier to talk about operational energy than embodied energy (smaller yes, but still important).
    WW

  19. Awesome article, thank you Cameron and contributors. Here’s a thought… let’s bring sustainable building materials into the equation. I know it isn’t part of BASIX currently, but could it be? It could start as a % of the build. It would be interesting to see the overall ‘benefit’ to resident health and the environment and ‘cost analysis’ if we added the use of sustainable building materials into the mix. I think it opens up a whole new discussion which the industry should seriously consider.

  20. Awesome article, thank you Cameron and contributors. Here’s a thought… let’s bring sustainable building materials into the equation. I know it isn’t part of BASIX currently, but could it be? It could start as a % of the build. It would be interesting to see the overall ‘benefit’ to resident health and the environment and ‘cost analysis’ if we added the use of sustainable building materials into the mix. I think it opens up a whole new discussion which the industry should seriously consider.

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