A consultation process is underway to inform what standards will be considered for Australia’s National Construction Code (NCC) 2025.

Performance requirements in the NCC set the lowest quality to which a building can be legally built, and will ultimately support national commitments to achieve legislated net zero targets.

NCC 2025 proposes to focus on requirements for non-residential buildings. The NCC is updated every three years and, historically, the focus alternates between residential and non-residential buildings.

Updates to the NCC in 2022 focused on upgrading residential standards, though these changes are yet to be adopted by all states and territories. 

However, delaying updates to residential building requirements until the 2028 NCC would mean even new homes would need to be retrofitted to meet the demands of a warming climate. 

Delaying stronger building standards until 2028 would also not leave enough time to sufficiently lower residential building emissions by the end of the decade.

Our modelled scenarios in which global warming is limited to 1.5°C show residential building energy intensity in Australia decreasing by more than 40 per cent by 2030, compared to 2020 levels. 

The current standards in the NCC 2022 wil not achieve this. For example, NCC 2022 still allows homes to be connected to gas. 

Raising standards for new homes in NCC 2025 could prevent at least three years of avoidable carbon emissions from insufficient standards. 

Higher standards, and the thermal security they provide, would lower energy bills as well as improve health and wellbeing outcomes for residents.

Climateworks proposes two changes for NCC 2025

Our first proposal is to embed a comprehensive definition of zero carbon buildings in NCC 2025, providing structure and consistent standards for the building industry to transition towards. 

Our definition provides an overview of the components of a zero carbon building, including form, thermal shell, materials, electrified appliances and services, and building operation, as well as planning and design decisions that underpin a building. 

We recommend our definition be included in NCC 2025 and applied to residential and non-residential buildings.

If the focus of NCC 2025 excludes residential buildings, we suggest that the definition be introduced as an Australian Building Codes Board (ABCB) Voluntary Standard in NCC 2025, and be made mandatory with NCC 2028, to provide sufficient time for industry to transition towards zero carbon standards. 

We also propose that embodied emissions and whole lifecycle assessments be included in the NCC 2025.

A building’s emissions profile includes operational emissions as well as embodied emissions, including those from embodied carbon. 

Embodied emissions are often considered hard to abate, as they are locked in upfront during building design and construction. They come from resource extraction, manufacturing processes, material transport, construction, demolition and the like. 

Others have also called for the NCC to address this ‘upfront carbon’ and adopt a retrofit or reuse-first approach through NABERS Embodied emissions initiative framework

A retrofit or reuse-first approach helps avoid demolition of buildings before they have reached the end of their structural life. 

Premature demolition leads to the loss of embodied energy and shortens buildings’ life cycles, resulting in higher upfront carbon emissions across the building stock as new buildings are put up in their place. 

Keeping buildings in use for longer through retrofitting and reuse is key to reducing upfront embodied carbon.

Including guidelines for embodied emissions in NCC 2025 will discourage excessive and unnecessary resource use and associated greenhouse gas emissions. They will also provide a consistent standard for industry to work towards.

Giving developers time to prepare

Staggering building code updates will provide foresight to industry, allowing them to transition their thinking and operations.

Although the NCC applies nationally, states and territories hold the responsibility for implementing the Code.

Victoria recently announced they are delaying the new energy efficiency updates included in NCC 2022, joining Tasmania, South Australia and Western Australia who have also delayed implementing those updates. 

The Victorian Government cited ‘significant global economic challenges’ to the building industry and the need for ‘more time to prepare’ as reasons for the delay.

Including a definition of, and Voluntary Standard for, zero carbon buildings in NCC 2025 would provide three additional years for developers and the building industry to prepare for zero carbon standards. 

This would also provide sufficient foresight for supply chains to adapt as builders shift to different material inputs. 

Training organisations and professional bodies would also have more time to upskill workers on embodied carbon emissions and zero carbon thinking, to align with industry professional development requirements and allow them to adapt internal practices.

Mandatory regulation drives change

Regulation is the best tool to coordinate a net zero transition across all players in the building industry

Mandatory regulation is a powerful tool that governments can deploy to effectively, efficiently and fairly drive change. It can be used to set consistent timelines across industry, setting a standardised framework by which all stakeholders operate. 

Voluntary guidance, while useful, does not create a mandate for change, so it is imperative that these recommendations be made mandatory by 2028. 

Without incentives, it is unlikely the market will shift on its own. 

Some financial institutions now offer tailored products for lower carbon homes, though this is far from the norm. 

Research shows there is a clear market failure, with a mismatch between customers who want more energy efficient homes and building industry norms that have led to poor home energy performance.

While the 7-star standard for homes mandated in the NCC 2022 may sound high, when compared with residential standards internationally, Australian homes are behind. 

Homes with high energy demands will also make the transition to a clean and renewable energy grid more expensive for everyone. 

Grid demand and infrastructure development go hand in hand; the higher demand the more infrastructure needs to be built to support it. 

And since infrastructure costs are passed onto customers via energy bills, more energy efficient residences are in the collective interest. 

Higher standards will make homes perform better even before turning on the air-con or heating, reducing the peak demands during the coldest, darkest nights and the summer heatwaves. 

Recommendations will improve consumers’ lives while cutting emissions

Consumers who want to build zero carbon homes can use the  definition of zero carbon buildings to base their new builds around, empowering them to clearly communicate their needs with industry. 

Australia’s energy inefficient building stock leaves households exposed to energy price hikes and higher bills, poor health outcomes through exposure to extreme temperatures, poor thermal comfort, and the amplification of social inequality

Research shows lower-income households disproportionately experience poorer thermal comfort and greater exposure to energy bill increases. 

Once people begin living in zero carbon homes, they will experience increased quality of life through no or low energy bills, increased comfort levels and better health outcomes. 

These changes to the NCC will also ensure that Australia stays on track with decarbonising the buildings sector in line with its national and international emissions reduction commitments. 

Upgrading Australia’s residential building performance requirements is a win-win action to both reduce emissions and protect the health and wellbeing of all households from the risks of a changing climate. 

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