Fact sheet: energy efficiency

Fact sheet included in the Coalition's press release on its proposed Green Carbon Initiative.

FACT SHEET: ENERGY EFFICIENCY

What is it?

Reducing energy use and greenhouse gas emissions from buildings by incorporating a variety of technologies and design features (such as passive heating/cooling) and retrofits (such as insulation).

• According to the Green Building Council of Australia, 97% of existing Australian buildings are too old to have been built with energy efficient features¹.
• Energy-efficient buildings have been cited as a major opportunity for low-cost (and often self-funding) carbon emissions abatement by respected climate change authorities and researchers including the United Nations IPCC, the Stern Report, the Garnaut Review², and McKinsey & Co³.
• Globally, the IPCC found that by 2030 about 30% of global projected greenhouse gas emissions from energy use in buildings can be avoided at minimal or zero economic cost.
• Locally, the Australian Sustainable Built Environment Council (ABSEC) estimates 27-31% of existing emissions from buildings can be abated at zero net cost - but the price signal contained in the Rudd Government’s CPRS will deliver less than one fifth this amount. ASBEC estimated by 2030 abatement of 60 Mt per year was achievable – about 11% of Australia’s 2006 emissions⁴.
• McKinsey & Co estimates the Australian building sector can, by 2020, achieve emission reductions close to 50 Mt of CO2e – about 8% of 2006 emissions.
• The Centre for International Economics estimates cuts of 39-45 Mt of CO2e can be achieved at a low cost (or net gain)⁵.
• Many green retrofit options are financially self-funding over time. Estimates for the payoff horizon for retrofitting an average existing building are in the 8-11 year range.
• Policy options to deliver gains from energy efficiency include:
  • Education campaigns to overcome information inefficiencies and alert building owners to the net economic savings from retrofits.
  • Accelerated depreciation for green retrofit expenditure.
  • Increased capital expenditure investment allowance for green capex.
  • Selective retrofit of existing government buildings.
  • Constructing new government buildings to Green Star standard.
  • Routine assessments of any regulatory burdens imposed on building owners, to ensure measures to encourage energy efficiency are not a drag on the economy.
• The Rudd Government has failed to so far provide a $500 rebate for the installation of insulation in rental properties - 18 months after it was first promised.

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¹ Green Building Council of Australia, the Dollars and Sense of Green Buildings 2008, found at http://www.aela.org.au/publications/Dollars_and_Sense.pdf
² The Garnaut Climate Change Review, found at http://www.garnautreview.org.au/index.htm
³ McKinsey & Co., An Australian Cost Curve for Greenhouse Gas Reduction, 2008 found at http://www.mckinsey.com/clientservice/ccsi/pdf/Australian_Cost_Curve_for_GHG_Reduction.pdf
⁴ http://www.asbec.asn.au/files/ASBEC%20CCTG%20Second%20Plank%20Report%202.0_0.pdf
⁵ “Building Energy Efficiency” CIE February 2008 at http://www.thecie.com.au/content/news/Final%20CIE_TPB_Perth%20(with%20animations).pdf