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Commercial buildings

22 September 2016

Is the commercial buildings method suitable for your business?

  • Are the commercial buildings offices, hotels or shopping centres eligible to receive a NABERS rating?
  • Are you looking to undertake improvements to the buildings that will improve their NABERS rating by at least one star?

If you have answered yes to both of the above questions, the commercial buildings method may be suitable for your business. Read on for more detailed eligibility and compliance requirements.

The commercial buildings method sets out the rules for projects that reduce emissions by improving the energy performance of buildings that are rateable under the National Australian Build Environment Rating System (NABERS). Eligible building types are limited to offices, shopping centres and hotels.

The method does not prescribe activities that must be undertaken. This provides flexibility for participants to determine what activities are most appropriate for their project. However, the activities must combine to improve the NABERS rating by at least one star.

Method variations

Section 114 of the Carbon Credits (Carbon F​arming Initiative) Act 2011 (the Act)​ allows for methods to be revised and varied. This is to ensure methods continue to operate as originally intended. Variations to methods are developed and drafted by the Department of the Environment and Energy. Information on draft methods and method variations is available on the Department of the Environment and Energy’s website.

The Clean Energy Regulator recommends making yourself familiar with proposed method variations relevant to your project should they arise, and how any changes between the original method and the varied method may affect your project plan.

Legislative requirements

You must read and understand the method and other legislative documents to conduct a commercial buildings project and earn Australian Carbon Credit Units (ACCUs). These include:

Tools and Resources

Quick reference guide to the commercial buildings method

This quick reference guide provides basic information about eligibility criteria and obligations that must be met to earn ACCUs from a commercial buildings project. It includes specific requirements from the legislation described above but should not be viewed as an alternative to reading the full legislative requirements. Additional information can also be found in the full method guide linked above.

Contents

Crediting period

Seven years – The crediting period is the period of time a project can apply to claim Australian carbon credit units (ACCUs).

Relevant section of the Act:

Eligibility requirements

There are general eligibility requirements in the Act, which include:

Obtaining legal right may require you to make arrangements with a number of different stakeholders including building owners, tenants and building managers.

In addition, a project must only involve existing buildings that are rateable under the National Australian Built Environment Rating System (NABERS), and are one of the following building types:

  • offices
  • hotels, or
  • shopping centres.

Mixed use buildings are also eligible, as long as they can be rated by NABERS as one of the above building types.

Section 9 of the method also requires that specific information be included in a project application before the project can be considered eligible. You should ensure you refer to this section and provide all the required information in your application.

Relevant section of the Act:

Relevant section of the Method:

Project activities

A project involves improving the energy performance of a single building or a group of buildings. The method does not specify particular activities that you must undertake and examples of suitable activities include:

  • modifying, installing, removing or replacing energy-consuming or electricity-generating equipment, such as
    • upgrading lighting systems
    • replacing heating, ventilation and air-conditioning systems with more efficient technologies and designs
    • upgrading boilers to more efficient, better controlled designs
    • installing a co-generation unit
  • changing how energy-consuming equipment is controlled or operated, such as
    • installing motion sensors or sensor lights
    • adopting improved building energy management systems that automatically manage energy consumption
  • changing the energy sources used by equipment, such as fuel switching from diesel to natural gas, or
  • promoting energy-conserving behaviours to building occupants.

Each activity you undertake must be reasonably expected to reduce emissions and, when combined, all activities must be reasonably expected to improve the NABERS rating of that building by at least one star.

Relevant section of the Act:

How is abatement calculated?

Abatement is calculated by comparing the emissions after a project’s activities with an adjusted emissions baseline by using the NABERS energy ratings and tools​.

The first step is to have an accredited NABERS assessor calculate an initial NABERS energy rating. Alternatively you can use an existing one that was conducted less than 18 months before the start of the project. The adjusted NABERS baseline is then calculated by adding 0.15 to the initial NABERS rating for each year that has passed since the initial NABERS rating. The 0.15 / year increase is known as the annual adjustment factor and reflects business-as-usual energy efficiency improvements.

The theoretical emissions associated with a building’s adjusted baseline NABERS rating are then calculated using the relevant NABERS energy rating reverse calculator. Abatement is then calculated by subtracting the calculated baseline emissions from the measured emissions that occurred during the measurement period.

To receive credit for this abatement, projects must also meet the minimum abatement threshold in at least one measurement period. This minimum threshold requires a 1 star improvement above the building’s baseline NABERS energy rating. Once this requirement is met, all subsequent measurement periods are also eligible to receive credit for the abatement. E.g. if a building met the 1 star improvement threshold in the first measurement period, this period is then eligible to receive carbon abatement and all the subsequent measurement periods are also eligible.

As part of calculating abatement, you must also take into account any emissions produced by electricity and fuel consumption in the building or buildings in your project. The method also takes into account any renewable electricity generated and consumed on site.

Relevant section of the Method:

Reporting requirements

In addition to the reporting requirements of the Act and the Rule, the method also sets out the following method-specific requirements for offset reports.

Section 29 of the method outlines the information that must be included in each offsets report. This includes information regarding:

  • building location and activities undertaken
  • NABERS energy ratings for each building, and
  • abatement calculations for the reporting period.

A reporting period for a project can be either 12 or 24 months, and can encompass either one or two 12-month measurement periods. As described in Section 5 of the method, a measurement period:

  • is the period over which a building’s energy consumption must be measured, and
  • must coincide with a 12-month NABERS rating period for that building.

Relevant section of the Act:

Relevant section of the Rule:

Relevant section of the Method:

Monitoring requirements

In addition to the general monitoring requirements of the Act, projects must meet specific monitoring requirements in the method. Section 33 states that you must monitor any renewable electricity generated and consumed onsite at a building.

Relevant section of the Act:

Relevant section of the Method:

Record-keeping

In addition to the record-keeping requirements of the Act and the Rule, projects must also meet the specific record-keeping requirements in the method. Section 31 of the method explains that this includes:

  • relevant NABERS energy rating reports
  • abatement calculations
  • building location
  • disposal records for energy-consuming or generating equipment, and for building components, and
  • other requirements

Relevant section of the Act:

Relevant section of the Rule:

Relevant section of the Method:

Audits

All projects receive an audit schedule when the project is declared and must provide audit reports according to this schedule. A minimum of three audits will be scheduled and additional audits may be triggered during a project. For more information on the audit requirements, see the Act, the Rule and the audit information on our website.

Relevant section of the Act:

Relevant section of the Rule:

Specialist skills recommended

You will need to engage an accredited NABERS assessor to undertake the required NABERS energy assessments.

Other examples of specialist skills you should consider include:

  • registered professional engineer
  • certified energy manager, or
  • certified measurement and verification professional.

Relevant section of the Act:

Relevant section of the Act:

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