In November last year, the Federal Government introduced legislation to Parliament to establish the $15 billion National Reconstruction Fund which aims to support, diversify and transform Australia’s industry and economy.
The NRF has been designed to invest across seven priority areas of the economy: renewables and low emission technologies; medical science; transport; value-add in agriculture, forestry and fisheries; value-add in resources; defence capability; and enabling capabilities.
The NRF is modelled on Labor’s Clean Energy Finance Corporation and will be governed by an independent board making independent investment decisions. It will be able to invest through a range of financing including loans, equity and guarantees.
In a recent submission to the consultation on the legislation (which ended on 7 February), the Property Council of Australia and Green Building Council of Australia (GBCA) stated the NRF presents a “unique opportunity to provide industry with the materials, workforce and policy frameworks to drive increased productivity and accelerate a transition to a decarbonised property sector”.
The Property Council and GBCA’s submission included five key recommendations set out to lower carbon emissions in the built sector. These were:
- Grow the market for strategic electric technologies. Net zero emissions buildings can be delivered using technology that exists today, but tackling the low availability and relatively high cost of some products remains a challenge due to poor information, capital costs, supply chain inertia and even regulatory barriers. The NRF can be leveraged to increase the availability of electric technologies to decarbonise building construction and operations, with a particular focus on heat pumps.
- Increase the availability and transparency of low embodied carbon materials. As the grid decarbonises, embodied carbon will comprise a greater share of the built environment’s emissions. The NRF should be directed to support product manufacturers of building materials to minimise and disclose the embodied carbon content of their products. There is also a need to fund the development of a embodied carbon framework for fitouts which can make up a significant portion of a buildings’ embodied emissions during its lifetime.
- Educate, upskill and grow the workforce for a low carbon built environment. The transition to low carbon, resilient buildings cannot be achieved without improving the skills and capacity of the local workforce. The NRF should develop a national education and training agenda for building energy efficiency and resilience.
- Drive deep energy efficiency retrofits for existing buildings. Half the buildings standing today will still be in operation in 20502 when Australia is committed to reach net zero emissions. The least-cost pathway to decarbonise the built environment must involve retrofitting our existing buildings at scale to increase energy performance and electrify current uses of fossil gas. Upfront capital costs for complex retrofits can be an obstacle and the NRF can be used to improve the business case for energy performance retrofits.
- Grow the market for low carbon fuels in a limited scope of applications. While almost all building operations should be electrified, there is a need for low carbon fuels (such as renewable diesel) for narrow applications like backup generation and construction machinery that cannot easily be electrified. The availability of low carbon fuels is currently limited in Australia and should be a priority for the NRF.
