Apartment owners can slash their energy and water costs by around 30% by peeling back the layers of their building’s performance with a NABERS rating. Find out how apartment owners are cutting costs and carbon, and attracting buyers in a crowded market.
Apartments by the numbers
- Up to 60% of energy consumption in large buildings, like apartments, comes from common areas and shared services
- Around 25% of administrative fund levies are spent on utility bills alone
- 15% of Australian households live in apartments, according to the 2016 Census
- 80% of people want information about a building’s environmental performance at the point of sale or lease
Apartment living is on the rise
The percentage of Australians choosing to live in apartments has increased by 78% over the last 25 years, and in some cities, like Sydney, more than half of all citizens will call an apartment home by 2030.
But when they are handed the keys to their new apartment, few people realise that they also collectively own a multi-million-dollar building.
Helping owners corporations and strata committees to better manage their buildings is a priority for the City of Sydney, as 80% of its residents currently live in apartments – 15 times more than the national average.
“We know owners corporations can make huge savings – around 30 per cent – through energy and water efficiency measures alone,” says Melinda Dewsnap, the City of Sydney's Sustainability Engagement Manager for residential buildings.
Melinda and her team has led the City’s Smart Green Apartments program since 2015, and during this time has helped 170 buildings save thousands of dollars each year on running and maintenance costs.
“The average saving across Smart Green Apartments is $58,000 per year – but it’s not just about the money. These owners corporations are also reducing their collective carbon footprint and creating more resilient buildings and communities.”
We often assume that apartment living is a sustainable choice, but research has found that shared hallways and carparks, gymnasiums, lifts and lobbies come at a cost. One study found, on a per person basis, high-rise residential buildings actually consume 27% more energy than suburban single-family homes.
NABERS helps to measure and manage
A NABERS rating reveals how energy and water is consumed – and the findings are often surprising.
“A base building can often account for 60% of a building’s energy use. But few people see the common property utility bills, which are usually paid on a direct debit by the strata manager,” Melinda explains.
“To get that first NABERS rating, an assessor has to dig around to find out what the owners corporation is paying for – and they often find hidden expenses.”
This may be that the carpark lighting or ventilation next door is connected to the building’s energy meter, or it could be that one electricity meter is servicing three towers with three very different energy profiles.
“No one can manage what they can’t measure. NABERS is a consistent benchmark that helps owners to understand how their building is performing so they can improve over time, especially as the energy mix becomes more complex. A NABERS rating also helps to communicate with tenants or prospective buyers.”
Eighty per cent of people want environmental performance information at the point of sale or lease. Why? Because people know energy efficiency is linked with good management and governance. - Melinda Dewsnap, Sustainability Engagement Manager, City of Sydney
How can NABERS help apartment owners?
NABERS measures and scores energy and water consumption in the common property areas of apartments. Working on a six-star scale, a NABERS three star rating is average while six is market leading.
NABERS estimates the average apartment building saves $104,420 each year when its NABERS Energy rating is elevated from 3 to 5 stars.
- Owners corporations: Measure and manage your building performance, understand the hidden costs to both your purse strings and the planet.
“NABERS is the backbone of your efforts to improve building performance and reduce costs,” Melinda says.
“All our buildings have to decarbonise and will, sooner or later, have to disclose a star rating. Disclosure will be like completing a tax return. Smart owners corporations are getting in early.”
- Apartment buyers: Most prospective buyers must trawl through reams of meeting minutes to find out how a building and its owners corporation function. But a NABERS rating gives buyers better insight into how a building performs. A high NABERS indicates a strata community is well-governed, makes good decisions, has a long-term capital works plan and a budget to execute.
- Local governments: NABERS can also support local governments to help their communities understand the hidden costs of operating buildings. With that information, they can help to save costs and carbon while enhancing community resilience. “NABERS ratings are really valuable to City of Melbourne,” says Krista Milne, Co-Director of Climate Change and City Resilience at City of Melbourne.
NABERS ratings help the City of Melbourne “understand how buildings are performing across the city and more easily identify where opportunities are to reduce emissions and target our resources,” Krista adds.
Towards one of two futures
Melinda says owners corporations can make poor decisions because they think they have one of two choices: to spend money or to do nothing.
“But we have found when we present owners corporations with two futures – one in which they did nothing, and one in which they invested – they can see that inaction comes at a cost. And they begin to understand that often the cost of inaction is often far greater than the upfront cost.”
Smart Green Apartments has a growing list of case studies that illustrate this point.
- $94,000 saving on energy and $35,000 on water at Regis Tower in Sydney’s CBD, by upgrading systems, adjusting settings and installing a data portal
- $82,000 saving on energy costs at The Peak above Paddy’s Market by upgrading lighting, optimising existing systems and installing motion sensors in shared facilities
- $20,000 annual saving at Pullman Quay Grand with a solar panel system that supplies 10% of the building’s common area electricity and a payback period of less than five years.
Success story: Why 100% renewable starts with a rating
When the owners corporation of Maestro embarked on NABERS Energy rating, the precinct was just four years old.
But Maestro’s owners corporation of big picture thinkers, backed by a knowledgeable strata manager and dedicated building manager, recognised that disclosing their energy rating would enhance the long-term value of their asset and appeal to the right buyers in the future.
Developed by Mirvac in 2015 on the site of the old Harold Park raceway, Maestro features 345 apartments across four buildings surrounded by open space and overlooking a lantern-lit courtyard.
Maestro achieved Australia’s first 6 star NABERS Energy rating with the help of GreenPower. This NABERS rating helped Maestro’s owners benchmark the precinct’s operational performance, demonstrate that the assets were well-managed and efficient, and set priorities for ongoing capital works.
And by purchasing energy through GreenPower, Maestro’s owners corporation is investing in renewable energy projects, like solar and wind farms, geothermal and bioenergy, for just $54.71 per unit each year.
“The owners corporation has been very deliberate. They want to attract a younger demographic and they feel NABERS can help them credibly communicate that their assets are green,” Melinda says.
“NABERS has been around for 20 years. It’s national and is only growing in scope. A NABERS rating, with a costed capital works plan, prepares your building for any future.”
How do you achieve a NABERS rating?
- Get ready: Source quotes from a few NABERS accredited assessors to understand the scope of work, then present your case to your owners corporation for approval.
- Gather your data: Collect 12 months of historical data on energy and water consumption, and details about the size and features of your building. Your assessor will be able to guide you.
- Achieve NABERS certification: Organise for your assessor to conduct a site visit to validate your data and identify areas for improvement.
- Improve your rating: Take action to reduce your energy and water consumption during the next 12 months and enjoy the savings. Collect data to feed back into your next rating to track your performance.
NABERS is offering fee-free ratings for a year from 1 July, so the only cost to building owners will be the assessors fee. There’s never been a better time to find out what you’re paying for.