The NSW property industry yesterday (Wednesday) heard more detail about environmental upgrade agreements, the financing scheme to improve building efficiency that has the potential to revolutionise the refurbishment industry in Australia.
A well attended forum held by the Property Council of Australia at Sydney’s Maritime Museum heard a wide range of views on the potential and the challenges of the scheme, which essentially ties repayments for loans to council rates.
The forum came on the back of announcements by the NSW Government and the City of Sydney which has released its EUA agreement template, the first council in NSW to do so, backing its support for EUA with offers of $40,000 in grant funding for approved green retrofits.
Other councils are expected to follow suit with their own EUA offer, headed by Paramatta.
NSW Environment Minister Robyn Parker said the scheme was a potential “game changer” with potential to unlock $2 billion worth of investment in environmental retrofits in existing NSW buildings.
She said the agreements would contribute to the NSW government’s NSW 2021 goal “to deliver high standard building retrofit programs, so that 50 per cent of NSW commercial floor space achieves a four star NABERS energy and water rating by 2020.”
Key to the EUAs was that the agreements would come with “secure low risk finance for energy and water upgrades, which is attached to the land, not the building owner,” Ms Parker said.
“The finance is repaid through council charges over time, and the costs recovered by the long-term savings on bills.
“With eighty per cent of NSW office space more than 10 years old the Agreements could see the performance of the eight million square metres of existing office space improve.
“The finance sector has advised that these agreements have the potential to unlock up to $2 billion worth of energy efficiency upgrades in the Sydney commercial property market alone.
“The investment will boost green jobs and generate substantial cost savings for property owners and tenants in the wake of rising electricity prices,” Ms Parker said.
Next will be a scheme for residential strata buildings.
The City of Sydney Lord Mayor Clover Moore said in announcing the EUA templates that, “Greater Sydney is the most power-hungry geographical area in the country and buildings produce nearly a quarter of Australia’s greenhouse gas emissions.
“This program will overcome a significant barrier for building owners who are discouraged from undertaking environmental upgrades where the tenant benefits from the lower electricity and water bills. Now buildings owners will have an increased incentive to reduce carbon emissions.”
Ms Moore also pointed to the high security expected to come with the finance facility.
The council aimed to sign its first voluntary agreement by the end of the year and have 10 in operation over the following 12 months.
EUAs would build on the council’s existing work to “make Sydney an environmental leader with innovative new programs to cut energy, water and carbon pollution costs,” Ms Moore said.
This included the new Sydney Better Buildings Partnership with major owners of CBD property – nearly 60 per cent – its offer of the $40,000 grants towards the cost of energy efficiency upgrades, plus up to $1000 to assist companies get a NABERS energy rating for their office tenancy when they join the CitySwitch Green Office Program in Sydney.
CitySwitch, run by the City of Sydney in partnership with capital city and municipal councils, now covered 322 tenancies covering 1.6 million square metres of office space, Ms Moore said.
“Working together with businesses and residents, we are making massive inroads towards the City’s 70 per cent carbon reduction target across the local government area by 2030 – one of the most ambitious of any Australian government.”
