Regulations for ”green building” become serious tomorrow, with building owners and even tenants facing potentially massive fines if their office space does not meet environmental standards when leased or sold.
The Commercial Building Disclosure (CBD) program - also known as mandatory disclosure - requires that a Building Energy Efficiency Certificate be issued if more than 2000 square metres of office space is sold, leased or sub-leased.
This applies to building owners and also tenants who sub-let the space. Each BEEC is valid for up to 12 months and will be a publicly available document. Failure to comply may result in fines of up to $110,000 for the first day of non-compliance and up to $11,000 for each subsequent day.
A BEEC includes:
- A National Australian Built Environment Rating System (NABERS) energy star rating for the building.
- An assessment of tenancy lighting in the area that is being sold or leased.
- General energy efficiency guidance.
Minter Ellison partner Peter George warned that landlords face impediments under the plan. ”The works will be capital in nature. They will not normally be able to be passed onto the tenant but the tenant will reap the benefit in lower energy costs,” he said.
The consent of tenants was required because the work often entailed some disruption. ”Ideally the work should be carried out when the property is not tenanted, but in a multi-tenanted building, the lease terms are very unlikely to line up,” Mr George said. ”Even if the work is done, the tenant’s fit out and general practices can have a big impact on the environmental credentials of the building.”
Tomorrow marks the end of the transitional mandatory disclosure period, which began on November 1 last year, when only a valid NABERS base or whole building rating was required.
The CBD program, which is designed to improve the energy efficiency of large office buildings, is managed by the federal Department of Climate Change and Energy Efficiency. NABERS is managed nationally by the NSW Office of Environment and Heritage on behalf of the federal , state and territory governments.
Energy use by commercial buildings accounts for about 10 per cent of total greenhouse gas emissions and the proportion is rising, according to the Department of Climate Change. Improving the energy efficiency of buildings is one of the quickest and cheapest ways to reduce greenhouse gas emissions, the department says.
