Grasping green buildings

In yet another sector of the industry riddled with acronyms and abbreviations, green buildings can be a minefield of confusing terminology. NABERS, Green Star, GBCA, BEECs, EUAs ... if you’ve wondered what it all means and why you need to know, then read on.

Green buildings have gone beyond being a buzz word. Both the public and private sectors are focusing heavily on energy use in the built environment with a view to improved operational performance and less waste. Commercial building owners, property managers tenants, trades and homeowners - everyone has a role to play in the green buildings game.

Legal requirement or marketing tool?

Running since 1999, the National Australian Built Environment Rating System (NABERS) was developed by the Australian Government, in unison with industry, to encourage innovation and market best practice. As the name implies, it is a rating system which uses a set of benchmarks based on national building performance data. NABERS is administered countrywide by the NSW Office of Environment and Heritage.

Utilising a suite of rating tools, NABERS measures performance on a 6 star scale, where 6 denotes market-leading performance and 1 represents a site with below average results and considerable scope for improvement. According to the NABERS website, 2.5 to 3 stars is about the national average.

NABERS ratings are available for offices (tenancies, base building or whole building), hotels, shopping centres and homes. A separate rating scheme for data centres is currently in development.

An office tenancy rating covers only tenanted space and is applicable to the tenant occupying a leased or privately owned office space within a commercial office building. The base building rating covers central services and common areas and a whole building rating covers a combination of both. Base building and whole building are the responsibility of the building owner or property manager. The offices scheme was previously known as the Australian Building Greenhouse Rating (AGBR).

Offices are the only type of building which uses all four environmental impact tools (NABERS Energy, NABERS Water, NABERS Waste and NABERS Indoor Environment). The remaining building types utilise the Energy and Water tools, with the exception of data centres, which will use Energy only.

Data centres are being targeted specifically as current estimates put data centre usage at around 2% of the world’s consumption. The NABERS website points out that the Australian IT industry has been significantly slower than international counterparts when it comes to understanding energy use. The website states: “A recent Australian study by Fujitsu asked CIO and IT Managers across most industry sectors about their Green IT policies. The study found that:

• Approximately 70% of survey respondents were not aware of their energy bills;
• Almost 80% of survey respondents did not carry out calculations for Power Usage Effectiveness or Data Centre Infrastructure Effectiveness; and
• Australia ranks lowest of countries surveyed in the Metrics Index at measuring green IT effectiveness.”

NABERS believes that a clear and consistently accepted benchmark for data centres is what is missing, hence the development of a suitable rating scheme specifically for that application.

Accreditation for NABERS is performed by an accredited assessor. Assessors are trained by NABERS on use of the rules for data collection and analysis, have passed an examination and are subjected to ongoing quality checks. Self-assessment of a property is possible, but for the purposes of internal performance measurement only. Ratings may not be reported or promoted in any way unless they are a true accredited rating issued by NABERS. Accreditation is valid for 12 months, as an annual review ensures the rating is an accurate representation of current operational performance.

To determine a rating, actual building performance information is measured for 12 months and compared with other similar buildings in the same location. To ensure that data is comparable, some adjustments may be required that account for specific location and use. These adjustments may be made in relation to climactic conditions, hours of use, level of services, energy sources and size/occupancy considerations.

It’s not mandatory, but ...

While NABERS itself is strictly not mandatory, it is proving to be as good as when it comes to commercial properties, as a number of other building schemes and programs demand a NABERS rating. The Commercial Building Disclosure (CBD) scheme is effectively the implementation of the Building Energy Efficiency Disclosure Act 2010, under which property managers and owners are bound by disclosure obligations. CBD is a national program that provides building buyers or tenants with information on the energy efficiency of a property. Run by the Department of Climate Change and Energy Efficiency, CBD aims to make it simpler for corporate Australia to rent or buy more energy-efficient space.

Under CBD, a building owner selling or leasing office space (or a tenant subletting) with a net lettable area of 2000 m² is required to hold a Business Energy Efficiency Certificate (BEEC), which includes: a NABERS Energy rating (for the base building), a tenancy lighting assessment and general energy-efficiency guidance. A BEEC is valid for 12 months and must be accessible by the public on the Building Energy Efficiency Register. As with NABERS, an accredited assessor must perform the assessment.

The CitySwitch Green Office is a program that addresses energy-efficiency opportunities across commercial offices throughout Australia, through the partnering of local and state governments, businesses and NABERS.

The program concentrates on tenants and aims to reduce greenhouse gas emissions through improved energy efficiency. Members of the program are given access to a range of tools and resources to assist in energy reduction. They additionally make a commitment to achieving an accreditation of 4 stars or higher. An annual awards program recognises and rewards member achievement.

Green Star is a national voluntary environmental rating system run by the Green Building Council of Australia (GBCA). Whereas NABERS rates operational performance, Green Star evaluates and rates on environmental design and construction in new and refurbished buildings. A number of Green Star rating tools cover building types ranging from industrial to healthcare, education and offices.

In 2010, the GBCA, the federal government and the NSW Office of Environment and Heritage agreed to work towards improving consistency between NABERS and Green Star. GBCA is currently developing the Green Star - Performance rating tool to address the performance of buildings. Working closely with NABERS to ensure there is no duplication, the performance tool will accept accredited NABERS ratings as input for ‘credits’ in the Green Star Performance rating tool.

The GBCA has been an advocate of closer collaboration between industry, government and industry associations to overcome issues such as split incentives, wherein the cost of upgrading buildings to be more sustainable is borne by one party (the owner) and the savings realised by another (the tenant).

The development of Environmental Upgrade Agreements (EUAs) is a step in the right direction. The three-party agreement is between a building owner, local council and finance provider. The finance provider lends the building owner funds to be used for environmental building upgrades. The financed amount is then levied as a special charge by local council, which collects repayments and pays the financial institution. Under this agreement, everyone’s a winner - the lending risk is lowered as council takes responsibility for the loan, the building owner has access to competitive finance and shares the costs with tenants. In terms of tenant inclusion in the agreement, conditions vary from state to state.

Green leases

The Australian Government’s Energy Efficiency in Government Operations (EEGO) policy includes a requirement for government agencies to sign a ‘green lease’ when arranging new office accommodations. Essentially, a green lease is a mutual agreement between owner and occupier to achieve agreed sustainable objectives and targets. A key feature of the agreement is a requirement to measure and benchmark performance using a rating scheme such as NABERS. The Department of Climate Change is also encouraging the use of Green Leases in the private sector.

Everybody needs good NABERS

It’s pretty clear why NABERS ratings work in a commercial building scenario, but why bother at home? NABERS for home is limited to 5 stars, rather than the market-leading 6 applicable in offices. Homeowners use the online calculator to input data on energy and water usage for 12 months. A rating is then generated, along with tips and tricks on how to improve low results. As a benchmarking tool, the average homeowner can see at regular intervals how changes to behaviours at home can realise real savings and performance. At this stage, the rating tool is not available to premises with shared facilities, such as apartments, or where utilities are not measured separately.

So, government tenancies require it, compulsory disclosure demands revealing it, homeowners can use it as a self-assessment tool for usage and behaviour modification; compelling arguments for understanding NABERS. In addition, according to the NABERS website, the Green Property Index, developed by property investment analyst IPD, found “that buildings with a NABERS Energy or Water rating of 4 stars or above deliver significantly higher returns than non-rated buildings, or low-rated buildings”.

Essentially there are legal and commercial reasons for wrapping your head around green buildings, mandatory requirements and the various rating schemes. There are a wealth of resources available online, as well as the lowdown on training and accreditation criteria, should you decide to branch out into what is clearly a burgeoning industry. Visit any of the following for more information:

• NABERS - www.nabers.gov.au
• Green Building Council of Australia - www.gbca.org.au
• CitySwitch Green Office - www.cityswitch.net.au
• Commercial Building Disclosure & BEEC - www.cbd.gov.au