Precincts to Support the Delivery of Zero Energy

August 2020
Precincts to support the
delivery of zero energy
(and carbon) ready buildings

32
ACKNOWLEDGEMENT
OF COUNTRY
We acknowledge the
Australian Aboriginal
and Torres Strait
Islander peoples of
this nation and pay our
respects to ancestors
and Elders past,
present and emerging.
We recognise and
celebrate their unique
cultural and spiritual
relationships to the
land, waters and
seas and their rich
contribution to society.
This report was commissioned by
the Department of Industry, Science,
Energy and Resources (DISER) in
2019 to identify opportunities and
barriers for precincts to support the
delivery of zero energy (and carbon)
buildings and identify government
actions in line with the Trajectory for
Low Energy Buildings program.
ABOUT THE AUTHOR
Arup is an independent firm of
designers, planners, engineers,
architects, consultants and technical
specialists, working across every
aspect of today’s built environment.
Together we help our clients solve
their most complex challenges –
turning exciting ideas into tangible
reality as we strive to find a better
way and shape a better world.
www.arup.com
AUTHORS
Roger Swinbourne
Michael Salt
Joan Ko
Amelia Tomkins
Jonathan Bills
Acknowledgement of contributions
In developing this report and
associated analysis, solutions
and recommendations, Arup has
leveraged the insights of national
government, industry and academia.
We would like to directly
acknowledge Dr Peter Newton,
Research Professor in Sustainable
Urbanism at Swinburne University
of Technology in Melbourne for his
significant input, including review
and drafting the document.
Also, Arup’s specialist
peer reviewers including
Christopher Pountney, Mark Lusis,
Chris Amos and Richard Stokes
for their strategic insight.
We acknowledge and thank the organisations involved in the stakeholder
interviews and workshops which have contributed to our solutions and
recommendations, including:
ACT Government, Australian Building Codes Board, Australian Energy
Market Operator, Australian Institute of Architects, Australian Renewable
Energy Agency, Australian Sustainable Built Environment Council, Building
Queensland, Buildings 4.0 CRC, City of Melbourne, City of Sydney, City
of Yarra, Climate Works Australia, CRC for Low Carbon Living, CRC for
Water Sensitive Cities, Department of Housing and Public Works QLD,
Department of Industry, Science, Energy and Resources, Department
of State Development, Tourism and Innovation, Development Victoria,
Development WA, Electric Vehicle Council, Engie, Engineers Australia,
Energy Efficiency Council, Environment NSW, Frasers Property, Green
Building Council of Australia, Housing Industry Association, Infrastructure
Victoria, Infrastructure NSW, Jemena, Landcom NSW, Lendlease, Local
Government Association of Queensland, Local Government NSW, Master
Builders, Master Builders Association of Victoria, Monash University, NZ
Government, Planning Institute of Australia, Property Council of Australia,
Renewable SA, Queensland State Government Architect, RMIT University
Clean Air and Urban Landscapes Hub, Sonnen, Stockland, Sustainability
Victoria, Swinburne University, University of Melbourne, University of NSW,
University of Technology Sydney, Urban Development Institute of Australia
NSW, Victorian Planning Authority.

54
Executive Summary
Introduction
Context
Precinct zero energy(and carbon) ready outcomes
Potential for action
Potential solutions
Next steps and gaps
Conclusion
CONTENTS
6
10
16
30
41
44
66
69

76
Executive Summary
In 2019 the former Council of Australian
Governments (COAG) Energy Council agreed
to the ‘Trajectory for Low Energy Buildings’1
(the Trajectory) which sets a pathway towards zero
energy (and carbon) ready buildings for Australia.
The ‘Addendum to the Trajectory for Low Energy
Buildings – Existing Buildings’2
was also agreed,
which provided a suite of initiatives to improve the
energy efficiency of existing buildings in Australia.
Both plans identified the challenges and opportunities that exist
in medium and higher densities around coordination of services
and the opportunities for precinct-scale coordination.
The purpose of this project was to identify opportunities and barriers for
precincts and identify appropriate government actions to support the delivery
of zero energy (and carbon) ready buildings in line with the Trajectory.
1 COAG Energy Council (2019), ‘Trajectory for Low Energy Buildings’
2 COAG Energy Council (2019), ‘Addendum to the Trajectory for Low Energy Buildings – Existing Buildings’
Photo 1: Fairwater, Blacktown, New South Wales.
Photo supplied by Frasers Property Australia

98
This report frames the physical
and organisational context for
precinct action and identifies
potential programs and government
solutions that may be applied to
better streamline the realisation of
precinct-scale action to progress
towards zero energy (and carbon)
ready residential buildings within
both new and existing precincts.
The report was developed based on
a literature review and engagement
with more than 80 stakeholders
from industry, academia and
government with the aim of
identifying appropriate government
action in the form of proposed
solutions that may be applicable
across Commonwealth, state and
territory and/ or local governments.
The report has given focus to
opportunities for precincts that
are not already considered in
the Trajectory to ensure that a
wider system response is taken to
considering the zero energy (and
carbon) ready outcomes being sought.
The potential solutions
have been developed
based on their ability to
deliver practical actions
where different levels
of government can
control or influence.
The report presents 12 potential
solutions based around enabling
mechanisms, targeted policy
actions or supporting measures to
support the following objectives:
To fully mobilise the strategic
urban and utility planning
process to enable zero energy
(and carbon) ready precincts.
To establish processes
that enable new forms of
precinct energy systems.
To use government development,
procurement and funding to
drive market transformation.
To establish authoritative
information sources and
instruments for zero energy (and
carbon) ready development.
Enabling mechanisms
provide the foundations
for improvements
Potential solution 1
Develop building codes and regulations that accommodate precinct-scale zero energy and
carbon initiatives.
Potential solution 2 Review planning controls to take greater consideration of energy and carbon at precinct-scale.
Potential solution 3 Align energy utility planning with development planning.
Establish an information/ knowledge hub for zero energy (and carbon) ready precincts,
including practical information on precinct-scale distributed energy systems.
Potential solution 5 Develop a Precinct Information Management (PIM) system.
Targeted policy actions
overcome specific
market barriers
Expand the mandatory commercial performance disclosure scheme to include
residential developments.
Continue to improve the rules, regulations, and incentives around precinct-scale distributed
energy systems.
Establish energy and carbon performance standards in government-initiated
precinct developments.
Supporting measures
assist with the transition
most cost-effectively
Potential solution 9 Seek to reward zero energy (and carbon) ready development with planning incentives.
Extend the scope of government energy funding and finance programs to enable the growth
of precinct-scale distributed energy projects.
In each state and territory, develop at least one showcase precinct development that
exemplifies the combined planning, design, governance and business models required for
zero energy (and carbon) ready precincts.
Potential solution 12 Establish an information base of costs and benefits for developers and green finance
providers to help improve access to capital.
EXECUTIVE SUMMARY

1110
Trajectory for Low
Energy Buildings
In 2019 the former Council of
Australian Governments (COAG)
Energy Council agreed to the
‘Trajectory for Low Energy Buildings’
(the Trajectory) and the ‘Addendum
to the Trajectory for Low Energy
Buildings – Existing Buildings’.
The Trajectory is a national plan
for a pathway towards zero energy
(and carbon) ready buildings, which
considers opportunities for new
buildings and National Construction
Code (NCC) updates. The Addendum
outlines a suite of initiatives to
improve the energy efficiency of
existing buildings in Australia.
The Trajectory acknowledges
there are limitations in some types
of buildings, such as apartment
buildings, to be zero energy (and
carbon) ready due to information gaps,
Introduction
mixed-uses or multiple stakeholders.
Transitioning to a zero energy (and
carbon) ready built environment
demands an understanding of the
precinct-scale opportunities and
ways to overcome core challenges
around precincts’ governance.
Purpose of this project
The purpose of this project was to
identify opportunities and barriers
for precincts to support the delivery
of zero energy (and carbon) ready
buildings for different urban densities
at different stages of development and
retrofit. This was developed based on
a literature review and stakeholder
engagement across industry, academia
and government. It sought to identify
the potential for government action
in the form of proposed solutions
that may be applicable across
Commonwealth, state and territory
and/ or local governments.
The report has given particular
focus to opportunities for precincts
that are not already considered in
the Trajectory, and to opportunities
outside the Trajectory, in ensuring
that a wider system response is taken
to considering the zero energy (and
carbon) ready outcomes being sought.
Zero energy (and carbon)
ready precincts
Precincts are inherently more
complex than buildings, and
innovation is often hindered by
governance and coordination failures,
under-investment in appropriate
technology and information
gaps between stakeholders.
The effective delivery of technical
and physical solutions at a precinct-
scale relies on strong governance
and appropriate business models to
appropriately coordinate the complex
mix of stakeholders. The success
of discrete initiatives for a precinct
cannot be separated from the
organisational infrastructure in place.
For this project, a precinct is defined
as ‘a unified area of urban land
with a clearly defined geographic
boundary’3
which is synonymous
with a neighbourhood or district.
High density precincts
High density precincts,
including zones of mixed-use,
are primarily located in major
cities. Zero energy (and
carbon) issues and
opportunities relate to wiring
and infrastructure capability, shared
services and common areas including
roof space and ability for onsite
renewable energy generation, thermal
networks, layouts and building
orientation, and energy associated with
lifts, carparks, pools, water and waste
management. They are also subject to
third-party governance in the form of
strata schemes.
PROJECT OVERVIEW
If we are to enable an energy efficient and low carbon
future, it will be critical that we learn how to build
and transition new and existing urban systems as
flexible, resilient and sustainable. This will require
a coordinated approach to our new and current
buildings as well as the supporting infrastructure
at precinct, city, region, state and national levels. Low density precincts
Low density precincts are
primarily suburban residential
developments in greenfield
areas or greyfield suburbs undergoing
redevelopment. Zero energy (and
carbon) issues and opportunities relate
to their buildings, street and lot layout,
orientation and design, operational
energy performance, and onsite and
offsite energy generation and storage.
They are also at a scale more open
to prosumers4
who can own and
control energy supply, demand and
storage solutions. They are less
likely to benefit from management or
coordination of thermal resources.
Medium density precincts
Medium density is a dwelling
typology that sits between
detached housing and high-rise
apartments. Medium density
precincts are emerging in the
established inner and middle
established greyfield residential
suburbs as a result of increasing urban
redevelopment.
Greyfield housing typically comprises
ageing and environmentally poor
performing or aged detached dwellings
that are replaced by medium density
structures in a range of configurations.
4 Prosumers are consumers who also produce a product, such as energy.3 Thomson, G. Newton, P. and Byrne, J. (2019). ‘Guide to Low Carbon Precincts’. Low Carbon Living CRC.
DENSITY AND FORM
The proposed solutions emerging from this project are focussed on low, medium
and high-density residential and mixed use precincts, with a focus on new
developments and consideration of the potential for existing developments.
It is recognised that for different densities and urban form there are distinct
opportunities and constraints for considering precinct level actions. It is also recognised
that across Australia – with very different climate zones, planning controls and utility
servicing requirements – there is significant variance in the applicable or appropriate
All precinct densities
Further opportunities for all precinct types to drive zero energy (and carbon) ready outcomes include:
− Incorporating emerging technologies and data
− Adopting broader sustainability initiatives such as water and waste management, urban greening and cooling
− Integrating automated building (and precinct) management systems, and
− Designing to allow for low carbon transport interactions that enable a transition to electric vehicles (EVs)
and increased active and public transport modes.
High density
9+ storeys
Medium
density
4-8 storeys
Low
density
1-3 storeys

1312
INTRODUCTION
For new precinct-scale development,
there is an opportunity to take a
full system approach to proactively
engage physical and organisational
infrastructure that could integrate
precinct-scale actions into the
new development and building
servicing solutions. This can be
coordinated from the ground up to
enable solutions that can serve the
medium and long-term transition.
For existing housing, much of the
building stock will still be in place as
we seek to transition to a more energy
efficient and low carbon future.
This will require significant retrofitting
in the drive to improve energy
productivity and low carbon outcomes.
To enable the existing housing stock
to transition, there is an opportunity to
consider the potential role for precinct-
scale action to support this transition.
Though the physical infrastructure and
governance opportunities for existing
precincts are more limited, there are
emerging opportunities in the form
of new business models, data and
technology, education and collective
engagement that can realise collective
benefits of precinct-scale action.
This report outlines a range of physical
and organisational infrastructure
that could be applied to service
both new or existing precincts.
It then seeks to identify where the
program or the potential solution may
impact on new or existing housing
stock in managing the transition.
The following elements are out
of the scope of this project:
− Consideration of embodied energy or
carbon in construction or operation
− Commercial buildings (except where
they are mixed-used residential
and commercial buildings)
− Waste and water services
(except for their on-precinct
energy consumption)
− Transport planning (except where
it relates to EV potential)
− Electricity and gas distribution
networks or supply mix (noting
that the carbon intensity of the grid
differs nationally and therefore
the carbon benefit of action at
precinct level varies), and
− Review of individual rating
tools and their methodologies.
GROWTH – NEW STOCK,
OLD STOCK
As Australian cities and regions
continue to grow, there is pressure
being put on our urban systems to
deliver more new housing, improve
existing housing stock and provide
the associated physical and social
infrastructure to support the growth.
The opportunity to leverage the scale
in both cases with solutions that
can support an energy transition at
a precinct-scale, considering both
the housing level action and the
precinct/ infrastructure level action,
will enable a more coordinated
approach to delivering on low
energy (and carbon) transitions. Photo 2: One Central Park, Chippendale, New South Wales
by Frasers Property Australia & Sekisui House Australia
Photo from Getty Images

1514
THE APPROACH
The approach for this project was to draw
out from literature, stakeholder engagement
and internal experience where the physical
variables existed at a precinct scale and then
where physical infrastructure and organisational
infrastructure could be applied to influence
energy and carbon outcomes at precinct scale.
Precinct programs
Commonwealth, State and Territory, Local
Government influence
Government action
Potential solution
Physical infrastructure Organisational infrastructurePhysical variables
Stakeholder engagement
Literature reviews
Internal experience
INTRODUCTION
Definitions
Physical variables
Elements of a precinct that can
be varied to realise a difference
in the carbon intensity of the
buildings in the precinct.
Physical infrastructure
Designed or engineered infrastructures
that can be put in place to change the
physical variables at a precinct-scale.
(solar PV, thermal networks etc.)
Organisational infrastructure
Systems of organisation that are
required to progress towards the
desired outcome or modify the
physical variables at a precinct-
scale (urban design, governance,
business models, data etc.)
Precinct program
Precinct programs combine
physical and organisational
infrastructure to support the
delivery of a desired outcome.
The combination of physical
infrastructure and organisational
infrastructure were then combined
and identified a range of potential
precinct programs. Governments
ability to influence across all levels
were then identified from the
engagement and literature to develop
a range of potential solutions.
Potential solutions
These potential solutions provide
a set of actions which government
could take to contribute towards
the realisation of the overall desired
outcome by addressing the role
of precincts in the transition to an
energy efficient, productive, low
carbon and resilient society.
The method applied has been
structured to focus on potential
solutions for different levels of
government and industry to support
precincts delivering zero energy
(and carbon) ready buildings.
These are enabling mechanisms,
targeted policy actions and supporting
measures for governments to enable,
or avoid disabling, appropriate
precinct-scale initiatives.
Proposed solutions have been
identified to support the delivery
of the Trajectory and deliver
zero energy (and carbon) ready,
productive and resilient precincts.
This method is represented
in Figure 1 opposite.
Figure 1 Overview of project methodology and approach

1716
Context
As Australia’s population grows, high performing,
synergistic and sustainable residential
precincts will be critical for the continued
liveability and resilience of our cities and regions.
These precincts will need to be capable
of leveraging precinct-scale and building-
scale opportunities to deliver zero energy
(and carbon) ready outcomes that are in line
with regional, national and global targets.
Enabling low energy and low carbon
outcomes in the delivery of new
buildings and precincts, as well as
implementing effective pathways
to transition existing buildings to a
low carbon future, is challenging.
In 2019, the COAG Energy Council
agreed to a national plan for a
trajectory towards zero energy
(and carbon) ready buildings
in Australia, recognising the
challenges, and highlighting the
need, for further analysis to identify
opportunities and initiatives that
can help deliver this plan.
Achieving low energy and low carbon
outcomes at a precinct-scale requires
an integrated systems approach due
to the complexity of stakeholder and
physical built environment variables.
Precincts are inherently more complex
than buildings and the effective
delivery of low energy and low carbon
programs at a precinct scale relies
on strong governance frameworks
and appropriate business models.
Therefore, the success of discrete
initiatives for a precinct cannot
be separated from the governance
frameworks that are in place.
Photo 3: Rhodes Corporate Park, Rhodes, New South Wales.
Photo supplied by Frasers Property Australia

1918
− Barriers relating to varying
stakeholder needs and split
incentives, requiring significant
collaboration and collective
decision-making to realise
and maintain shared value.
− Planning in the face of uncertainty.
For example, changing regulation,
financing terms, energy technology
evolutions, grid carbon intensity,
carbon pricing, carbon policy etc.
− The timing disconnect of
development staging and
infrastructure servicing or
asset replacement cycles.
− The lack of incentive, value or
transparency to the housing
markets on the value or costs
factored in energy efficiency,
supply or carbon factors/ risk.
− Lack of clarity in government
energy and carbon strategies and
policies at all levels of government.
− Changing demand and the desire
to increase energy efficiency/
productivity over time while also
meeting the financial objectives
of precinct-scale action.
Critically, many of these can be
applied to new precincts and to retrofit
existing precincts to drive positive
energy and carbon outcomes at scale.
Historically, one of the key challenges
to moving beyond the building-scale is
the complex and unregulated nature of
stakeholder interactions, which include
competing interests and their ability
to impact and influence outcomes.
The recent innovation and
advancements in applied technologies
and data are changing governance and
business models, enabling the potential
streamlining of precinct-scale
solutions. These systems can enable
the collective realisation of the benefits
from collaboration and scale.
For this report, the identified need was
to develop a greater understanding of
the potential role that a precinct focus
can play in the transition towards
low energy and carbon outcomes, the
barriers and opportunities involved
in enabling them, and the appropriate
role that government could take in
facilitating the desired outcomes.
Precinct challenges
Challenges at a precinct level present
themselves in several different ways.
Generally, commercial and governance
barriers appear to far outweigh the
technical barriers facing precinct
development or redevelopment.
Development stakeholders have
access to appropriate technologies
and technical solutions to deliver
low carbon outcomes, however their
incorporation is stifled by the lack of
integrated governance frameworks
and information asymmetry.
Due to the complexity
of the decision-making
and value differentials at
a precinct-scale, it
is critical to consider
a program of
collective actions and
enabling governance
frameworks rather than
identifying discrete
technical solutions.
− The need for financial institutions
to better understand precinct-
scale systems and increase
their willingness to finance a
project. Often tied to consumers’
understanding of perceived worth.
− Of clarity in government
urban precinct planning and
design policies and practices
around energy/ carbon causes a
reluctance to achieve anything
beyond minimum compliance.
− Lack of clarity, information and
trust surrounding new business
models or governance models
needed to enable precinct systems.
− Understanding the role (ie as private
vs shared transport) and rate of
uptake of electric vehicles in a
precinct and the impact on electricity
consumption and tariff structures.
− Managing the risks around the
relative financial and carbon cost-
benefits of actions and inactions
taken in response to uncertain
future carbon transition targets.
− The potential costs and market
appreciation gaps of achieving
above-standard development designs
and outcomes in an unregulated
and competitive marketplace.
− Knowledge and capability gaps
among industry, government
and community stakeholders.
− Distribution network interface
and regulations, and retail energy
contestability (customers right
to choose their energy provider)
which add additional costs and
uncertainty to distributed network
investments in innovation.
− Changing nature of supply and
demand with rapidly evolving
technologies including heat pumps,
efficient appliances, lighting,
batteries and electric vehicles.
− The costs associated with
transitioning existing precincts
and their assets before required
by the replacement cycles.
BARRIERS
There are limitations and diminishing
returns from the renewable energy
supply and energy efficiency gains that
can be realised at the building-scale.
As a result, economics and efficiencies
begin to drive the focus beyond
the building to seek opportunities
at the precinct or network scale.
Taking the development to a zero
energy (and carbon) ready state
requires consideration outside of
the building to the precincts, region
and grid, and requires alternative
technologies, procurement,
governance and business options
to realise desired outcomes.
There are many cases locally
and globally where the inclusion
of precinct-scale solutions has
significantly enhanced the energy
productivity and reduced the carbon
intensity of precinct operations.
In these cases, the energy and
carbon benefits have realised the
outcomes through economies of
scale, energy demand diversity
and supply options, use of ‘waste’
energy, shared infrastructure, space
efficiencies and collective action.
Some notable challenges that currently inhibit the ability of precincts to
support the delivery of zero energy (and carbon) ready buildings include:
CONTEXT

2120
OPPORTUNITIES
Delivering zero energy (and carbon)
ready outcomes at a precinct level
provides the ability to leverage
and capitalise on economic and
physical opportunities that are
not able to be achieved at an
individual building level.
Recently there has been a move by
many precinct-scale developers to
seek opportunities to achieve zero
energy (and carbon) outcomes through
driving precinct-scale solutions where
they can, and then look to offset the
remaining energy/ carbon gap through
offsite renewable energy procurement
or other forms of offsetting.
These opportunities have been
recognised by industry and were
reflected in the literature reviews
and stakeholder engagement
undertaken through this project.
Some of the notable opportunities
that governments can use to support
the delivery of zero energy (and
carbon) ready buildings, both
new and existing, include:
− Leveraging the physical proximity
of buildings and users within a
precinct to provide opportunities
to share energy, capture waste
energy or generate electricity.
− For new precincts, applying and
coordinating current best practice
smart grid, distribution, demand,
supply and storage to deliver optimal
energy/ carbon performance (and
centrally offset the residual carbon
in transition to carbon neutral).
− Offering financial incentives and
investment in research projects
(such as the Low Carbon Living
Cooperative Research Centre).
This approach has elicited successful
outcomes over the past decade in
an Australian and global context.
− Using the physical proximity to
create manageable governance
structures, business models or
community action to own assets
or drive positive action.
− Developing showcase and
leadership projects and improving
communication of available
sources of information. This would
provide more relevant advice and
information, access to experts and
research, and case study examples.
− Managing the regulatory, economic
and education interventions
needed to dismantle issues such
as split-incentives, information
asymmetry and political uncertainty
that currently hamper progress.
− Providing scalable policy and
code regulations that not only
enable, but drive, precinct-scale
sustainability actions beyond the
carbon and energy challenge.
− Upskilling industry and
educating key stakeholders
(e.g. urban planners, developers)
to recognise their capabilities
and key roles they can play.
− Utilising planning and urban
design knowledge to dictate
sustainability outcomes for new
precinct-scale developments.
− Creating a set of precinct design
and assessment tools – many at
prototype stage – with a capability
of realising more sustainable zero
energy (and carbon) ready precincts.
PRECINCT ENERGY CONTEXT
Energy consumption,
service and density
In the Australian residential market,
the energy (and carbon) profile is
largely determined by the region’s
predominant fuel source, space heating
and cooling behaviours, energy
efficiency programs and the use of
technology advancements in lighting,
refrigeration, and water heating.5
In addition, price signals that are
inherent to gas and electricity
tariffs can shape energy use,
driving the uptake of different
incentives and substitutes (e.g.
solar photovoltaics and batteries).
Understanding where and when
energy is consumed within a building,
and to a greater extent within the
precinct itself, can determine the
value of action and help prioritise
zero energy (and carbon) initiatives.
As we continue to develop our cities
to meet population growth, residential
areas are becoming increasingly dense.
Medium and high-density precincts
are being developed in greyfield areas
located in established inner and middle
city suburbs. In these instances,
physically aged and poor performing
detached dwellings are being
replaced by medium and high-density
structures in different configurations.
The challenge for this new typology of
residential development is that medium
and high-density buildings have a
higher energy intensities than the
detached dwellings they are replacing.6
The need to address building and
precinct-scale energy (and carbon)
efficiencies is increased at these
densities, and identifying the
opportunities and barriers that exist
at the precinct-scale becomes pivotal.
In each of the states and territories,
low, medium and high-density
apartment buildings consume energy
differently. Figure 2 shows the average
energy use per apartment dwelling for
low, mid and high rise apartments, and
the proportion of this energy use that
is attributable to gas and electricity.
As shown, energy use per dwelling
increases as the apartment density
increases, and energy use can
differ considerably for the same
apartment density in a different
state or territory (given space
heating and cooling differences).
The proportion of electricity and
gas use also varies across Australia,
which can determine the appropriate
use of incentives and substitutes.Per apartment energy use in Australian apartment buildings
Gas
Electricity
NSW
0
20
40
60
80
100
120
VIC QLD WA
Low rise Mid rise High rise
SA ACT TAS NT TOTAL
Energyuse,GJ/apartmentdwelling
low
mid
high
1-3 4-8 9+
STOREYS
Figure 2 Energy use in Australian apartment buildings7
5 Ryan, P. & Pavia, M. (2016) Australian Residential Energy End-Use – Trends and projections to 2030.
6 Newton, P. (2011). Urban Consumption. CSIRO Publishing
7 Clark, M. & Oppermann, M. (2020) Energy efficiency opportunities in Australian apartment buildings – challenges and directions for Australian policy.
CONTEXT

2322
Figure 3 shows the proportion of
energy use for shared services and
in-apartment uses between the
different densities. Although the
majority of the energy consumed in
low, medium and high-density occurs
at the dwelling level, for the higher
density developments, the energy
is increasingly associated with the
shared services and common areas.
In higher density apartments, the
proportion of energy for shared
services is much higher due to the
energy associated with lifts, carparks,
pools and other shared internal
services. A precinct scale provides
the next step to shared services
provision, and the governance may
be simplified through having to
only engage with strata owners
rather than individual apartments.
It is important to understand the
different demand profiles within
dwellings and shared services to
understand where a physical or
organisational action may create
impact. From a precinct perspective,
the ability to control and influence
energy (and carbon) consumption for
shared services is far greater than for
the individual dwellings themselves
given fewer barriers and the ability
to monitor and offset energy use.
End-use energy consumption
within the dwelling can also be
examined. Total residential energy
consumption for water heating, space
conditioning, lighting, cooking and
appliances is shown in Figure 4.
Although this data is not specifically
for apartment buildings, the
proportion of energy used for a
particular end-use is consistent
across most residential spaces.
As shown below, the majority of
energy use within a residential
dwelling is for space conditioning
(40%), appliances (25%) and
water heating (23%).8
Figure 5 Indicative potential role of precincts in zero energy (and carbon) ready transition
Zero Energy (and Carbon) Ready Precinct Indicative Share Potential of
Action to Energy (Carbon) Zero
Precinct X 2020
carbon
Building actions Precinct actions Grid carbon
reduction
tCO2
-e/year
Low rise
Shared services
Totalenergyuse,PJ
In apartment
Mid rise High rise
0
5
10
15
20
25
35
40
30
Figure 3 Energy use in Australian apartment buildings6
To achieve a zero energy (and
carbon) ready precinct, there are
three key actions that need to be
considered. These three actions will
ultimately deliver a precinct’s net zero
outcomes: building actions, precinct
actions and grid decarbonisation.
End-use energy consumption
Water heating
23%
Cooking
5%
Lighting
7%Space
conditioning
40%
Appliances
25%
Figure 4 Energy by end use in Australia8
8 Energy Rating – Share of total energy by end use
Photo 4: Energy monitoring system
© Getty Images
Three actions to deliver a precinct’s net zero
outcomes: building actions, precinct actions and
grid decarbonisation.
For high density apartments, the total
shared services energy nearly matches that
consumed in apartments.
Figure 5 provides an indicative waterfall chart showing how the building scale,
precinct-scale and network scale responsibilities may play out to 2050.
The key is to define the appropriate role of the precinct in the decarbonisation
pathway and the role (or agency) of industry and government in delivering
that role.
Precinct actions and the building interface
CONTEXT

2524
Collaborate to maximise the value of customers’ Distributed Energy Resources to the
Australian energy system for the benefits of all energy users
FocusAreasWorkstreamsActivities
LEADERSHIP
EXCHANGE BETWEEN MARKETS
CUSTOMER
RESEARCH & INVESTIGATION COLLABORATION DEMONSTRATIONSKNOWLEDGE SHARING
MARKETS FRAMEWORKS INTEROPERABILITY
DISTRIBUTED ENERGY AND THE GRID
Energy markets that efficiently
exchange the fair value from customer
owned distributed energy
Technical systems that enable the efficient
use and operation of
the distributed energy system
Optimising investment
in and operation of
network and DER
infrastructure
Standardising the physical
operation, visibility and
resilience of the distributed
energy systems
Enabling multi-party
exchange of value in
markets within physical
network constraints
Capturing and
sharing customers’
preferences to inform
the future
Purpose
Australia’s energy sector is
experiencing an industry-wide
transformation with the growth
of what is collectively known as
distributed energy resources (DER)
which includes rooftop solar, batteries,
electric vehicles, demand response
mechanisms and virtual power plants.
As the electricity market finds itself
at a critical juncture, government
agencies, market authorities, industry
and consumer associations have
come together to form the Distributed
Energy Integration Program (DEIP)
to help realise and maximise the value
of the DER for all energy users.8
DEIP’s position in the energy market
enables it to assist and mobilise DER
programs (Figure 7) and it is situated
to play an important role in delivering
zero energy (and carbon) ready
apartment buildings and precincts.
Relationship to Distributed Energy Integration Program
Figure 7 DEIP framework9
Carbon intensity
Carbon intensities associated
with offsite electricity production
(i.e. Scope 2 emissions) differ
between the states and territories,
with the greatest carbon
intensity experienced in Victoria
(1.02 kilograms of carbon per kilowatt
hour kg (CO2
e / kWh)) and the lowest
in Tasmania (0.15 kg CO2
e / kwh).
Although energy (and carbon)
precinct actions elicit the same energy
efficiency and productivity outcomes,
the differentials in electricity
emissions factors determines the direct
carbon benefit from that action.
For example,
improving efficiencies
in common area
lighting will generate a
greater carbon saving in Victoria
than it will in Tasmania. As such,
the economics associated with
energy (and carbon) precinct
actions will be different across
the states and territories.
Figure 6 Latest estimates of electricity
carbon emission factors for end users
NSW &
ACT 0.81
VIC 1.02
TAS 0.15
QLD 0.81
SA 0.44
WA 0.69
NT 0.63
Scope 2 Emission Factor
(kg CO2
-e/ kWh)
9 Australian Renewable Energy Agency (ARENA). Distributed Energy Integration Program.
CONTEXT

2726
Figure 8 Taskforce on Climate Related Financial Disclosures framework11
Climate related risks, opportunities and financial impact
Transition
Risks Opportunities
Income Statement Balance Sheet
Resource Efficiency
Energy Source
Products / Services
Markets
Resilience
Assets
Liabilities
Capital
Financial Impact
Physical
Policy and Legal
Technology
Market
Reputation
Acute
Chronic
Revenues
Expenditures
EMERGENCE OF ESG AND
SUSTAINABLE FINANCE
Environmental, Social and Governance
(ESG) reporting has become a
common expectation of private
investors and is now an important
factor during the investment process.
Over the last decade, studies have
demonstrated that good corporate
sustainability performance directly
translates to good financial results.
The concept that organisations which
embed ESG risk management have
higher overall returns is spreading
across the globe and is set to become
common practice. In broad terms,
establishing an ESG reporting
framework can provide numerous
benefits beyond financial gain.
These include meeting shareholder
needs for reporting, improving
organisational resilience and meeting
community expectations. This is being
recognised in Australia both in private
markets and in government funding.
The market for impact investing is
experiencing exponential growth
in Australia, more than tripling
over the past two years from
$5.7 billion to $19.9 billion10
.
This report notes that Australian
investors – from super funds to
family offices – have indicated
they would like to increase their
allocation towards impact investments
more than fivefold to $100 billion
over the next five years, and invest
in clean energy, housing, health
and wellbeing, education and
conservation, among other themes.
As part of this global move towards
responsible investment, the global
finance industry moved to set up
the Taskforce on Climate Related
Financial Disclosures (TCFD).
This provides a framework for
companies and other organisations
to develop more effective climate-
related financial disclosures through
their existing reporting procedures.
Investors may be concerned about
risks associated with climate change
(Figure 8) that could impact the value
of their investments, including:
Climate risks
e.g. rising sea levels and increasing
frequency and intensity of extreme
weather, including storms,
heatwaves and droughts.
Carbon risks
e.g. regulatory shifts, technology
disruption and changes in market
demand for carbon intensive goods
and services like fossil fuels.
Transition risks
e.g. disruptive transitions which
could impact supply chains
and cost of doing business.
TCFD provides a framework for
which carbon accounting can be
made, and climate change and
carbon risk factors can be captured
in investment decisions.
10 Responsible Investment Association Australasia, 2020, Benchmarking Impact: Australian Impact Investor Insights, Activity and Performance Report 2020
11 Task Force on Climate-related Financial Disclosures
$100bn
towards impact
investments over
the next 5 years
This shift in private finance provides
greater opportunity to realise precinct
level investment in projects that
can deliver more energy efficient
or reduced carbon outcomes.
CONTEXT

2928
The Technology Investment Roadmap
discussion paper12
(the Roadmap)
released in May 2019 outlines the
Commonwealth Government’s intent
to focus on new and emerging low
emission technologies that will
help Australia reduce its global
emissions, strengthen the economy,
and support jobs and businesses.
The framework aims to establish
partnerships with industry
and stakeholders and prioritise
technologies associated with
higher emission alternatives and
technologies that have a competitive
advantage in the market.
For precinct-scale initiatives, the
paper highlights the need to realise
the full potential of DERs and develop
technologies such as virtual power
plants to improve their integration.
Demand for shorter payback periods
and reductions to transaction costs,
as well as the innate complexities of
the electricity system, were identified
as significant inhibitors to the uptake
of DER and the implementation
of suitable technologies.
This focus on DERs in the
Roadmap is encouraging, and it is
recommended that other initiatives
thatcan be deployed at the
precinct-scale to help deliver zero
energy (and carbon) ready buildings
should be further incorporated and
developed into the Roadmap.
12 Department of Industry, Science, Energy and Resources (2020).
‘Technology Investment Roadmap Discussion Paper’
COMMONWEALTH GOVERNMENT’S
TECHNOLOGY INVESTMENT
ROADMAP DISCUSSION PAPER
CONTEXT
Photo 5: Energy timer app
© Getty Images

Desired outcome Precincts that contribute to an energy efficient, productive, low carbon
and resilient built environment
Required action Government actions to enable or dismantle barriers to precinct programs
realising the desired outcome
Potential solutions Suite of actions for governments to influence and enable the uptake of
precinct programs to achieve zero energy (and carbon) ready outcomes
Physical variables Understanding precinct energy and carbon variables
Physical infrastructure Physical infrastructure solutions to affect physical variables
Organisational
infrastructure
Organisational infrastructure to coordinate physical infrastructure solutions
Precinct programs Optimal physical and organisational infrastructure combinations
3130
Precinct zero energy
(and carbon) ready outcomes
There is often a tendency to jump directly to
the physical infrastructure as the solution to
the problem. As stated earlier, the problem or
precinct is at the nexus between the physical
and organisational infrastructure and requires
a systems-based solution to realise the outcome.
For that reason, this section describes precinct energy
and carbon variables, and then the physical and
organisational infrastructure which can modify them.
It then sets out precinct programs combining physical and
organisational infrastructure which can drive the transition to
precincts that can deliver zero energy (and carbon) ready buildings.
The foundation of action helps achieve the overall
desired outcome which is stated as below.
Desired outcome
Required action
Potential solutions
Physical variables
Organisational
infrastructure
Precinct programs
The desired
outcome is for an
energy efficient,
productive, low
carbon and resilient
built environment.
To achieve this at
appropriate scales
we need to address
this at every level
and therefore
understand the
potential role
of precincts in
that transition.

3332
PRECINCT ZERO ENERGY (AND CARBON) READY OUTCOMES
Table 1 Physical infrastructure variables
Energy Form Technologies
Electrical
energy
Solar photovoltaics, wind or waste to energy networks
Decentralised systems e.g. microgrids
Battery storage systems
Smart grid, remote switching, demand management,
precinct information models
Thermal
energy
District heating and cooling network
Co-generation or tri-generation systems
Ground source or water sourced heat pumps
Collection of ‘waste heat’, waste to energy
Energy
efficiency
Heating, cooling, lighting, heating ventilation
air-conditioning (HVAC), lifting, appliances
Smart meters and grids, data and monitoring
Coordinated upgrades/ programs/ maintenance regimes
Water supply
and treatment
Decentralised wastewater treatment (including energy in
pumping and treatment)
Stormwater collection, treatment and reuse
Waste
Waste stream separation (e.g. organic) and collection
(e.g. vacuum)
Energy from waste and resource harvesting
Microclimate
Surfaces, materials, green infrastructure, shading, water
Deep soil zones (impacts on heating or cooling demand)
Bulk
procurement
of infrastructure
or services
Energy efficiency or supply infrastructure/ assets
Bulk provision of services (hot water/ HVAC tuning, design,
lighting upgrades or retrofits)
PHYSICAL INFRASTRUCTURE
At the interface between the buildings, precinct and the regional networks,
there are opportunities to introduce and develop the physical infrastructure
that will help achieve zero energy (and carbon) ready precinct outcomes. It is
important to understand and consider the potential energy and carbon efficiencies
that can be achieved using physical infrastructure, technologies and materials
so that investment decisions and outcomes can be optimised. Energy and
carbon efficiencies within the physical infrastructure are listed in Table 1.
Desired outcome
Required action
Potential solutions
Physical variables
Organisational
infrastructure
Precinct programs
Desired outcome
Required action
Potential solutions
Physical variables
Organisational
infrastructure
Precinct programs
Elements of a
precinct that can
be varied to realise
a difference in the
carbon intensity
of the buildings
in the precinct.
Designed or
engineered
infrastructures that
can be put in place
to change the
physical variables
at a precinct-scale
(e.g. solar PV, thermal
networks etc).
PHYSICAL ENERGY AND CARBON VARIABLES
At the precinct-scale, there are physical and network variables of the
built environment that contribute to the energy and carbon impact of
a building. These variables can be introduced, arranged or modified
in different ways to elicit different energy and carbon outcomes.
It is important to note, that in addition to these variables, there are
existing regulatory requirements and standards at a local, state and
territory and national level. These make up the regulatory environment
and can also impact the energy and carbon outcomes of a precinct.
Figure 9 Physical energy and carbon variables
Primary type of energy
function/ demanded –
heating, cooling, lighting,
mechanical and electrical (and
any losses in conversion)
Variables include
Regional climate and
the microclimate of
the precinct, seasonal
variability, including
green infrastructure
impacts (if present)
Source potential and
intensity – grid electricity,
local renewable, gas, grid
capacity, grid carbon
intensity (per kWh or GJ)
Distribution networks,
embedded networks,
smart networks,
thermal networks or
storage capacity
Zoning, density, land use,
usage profile, building
codes, space allocated
to cars (roads, parking,
driveways etc.), type
and scale of buildings
Potable, non-potable
(energy use in alternative
water supplies: stormwater
runoff, rainwater
harvesting, wastewater
recycling and re-use)
Energy demand Energy Supply
Water Urban form
Climate and
microclimate
Method of energy
distribution

3534
13 Precinct assets include mechanical systems, chillers, air-conditioning units, cooling towers, boilers, stormwater assets, trunk utilities (water, gas, electricity).Figure 10 Organisational infrastructure variables
ORGANISATIONAL INFRASTRUCTURE
Once the merits of physical infrastructure solutions on the decarbonisation
pathway have been determined, the next step is to determine the appropriate
or potential governance, business models and information to enable the
physical infrastructure.
In the context of precincts, organisational infrastructure describes the systems
of organisation and coordination required to finance, implement and maintain
physical infrastructure solutions to positively modify physical and carbon
variables in precincts. We have identified three key areas of organisational
infrastructure to address key barriers to zero energy (and carbon) ready precincts:
Governance and accountability
structures can clarify, streamline and
hold stakeholders accountable to the
different roles in precincts. Many
different stakeholders are present in
precincts, from networks owners,
regulators and planners, to designers,
strata managers, tenants and owners.
Each are subject to different individual
or organisational requirements which
need to be coordinated and engaged
in a structure which enables mutual
alignment. Ensuring zero energy
(and carbon) ready outcomes relies on
clear structures, roles, strategic visions
and decision-making frameworks.
The laws, policies, guidance
and institutional structures vary
significantly across Australia and
the precinct level stakeholders.
This means each have different
instruments available that impact
the ability to control or influence
energy/ carbon outcomes at a precinct-
scale. These instruments need to be
appreciated and considered by key
precinct stakeholders at the right
stage of design/ decision making
to enable appropriate action.
Finance and risk
There is a need for a reasonable
distribution of costs and benefits
across the stakeholders to ensure
that the benefits of precinct action
can be shared appropriately.
Appropriate business models can
alleviate the challenges arising
from the multi-stakeholder nature
of precincts by enabling a clear
vision and set of requirements
to incentivise, coordinate and
distribute benefits to stakeholders.
The effective allocation of risk and
the ownership of the associated
costs need to also be adequately
considered. The need for physical and
organisational infrastructure sets out
a structure of reliance. This requires
appropriate consideration of the
relative risks to ensure resilience and
reduced exposure for stakeholders.
The financing challenge of
precinct-scale action is that action
is often seen as an un-regulated
initiative providing a beyond
business-as-usual (BAU) approach,
often with untested technologies,
with uncertain market uptake.
This poses a challenge in accessing
adequate equity or debt finance
to enable the upfront capital or
the business model required to
enable precinct-scale action.
There is an emerging potential to
use green finance, grant funding,
environmental upgrade agreements or
tax benefits to close the finance gap.
This could also be addressed through
transparent case studies (including
financials) or through providing
regulatory direction and certainty to
enable greater confidence for investors.
Information, data and capability
Organisational infrastructure can
help to build market capability
and consumer literacy and enable
efficient and transparent information-
sharing. On the supply side,
upskilling designers and developers
will support the transition to a low
carbon and energy efficient future.
This must be reinforced on the
demand side, by building consumer
awareness, communicating the
value of sustainable precincts
and creating transparent and
consistent systems of disclosure,
compliance and monitoring.
To manage energy and carbon at
a precinct-scale, it is critical to
understand the nature of consumption,
supply and distribution within the
precinct as well as an appreciation of
who or what can impact or influence
carbon emissions. It is also important
to understand what the decision-
making processes are and which assets
and building occupants are responsible
for the metered consumption.
All available instruments should
be considered by stakeholders and
utilised at the appropriate stage
of design/ decision making to
achieve the desired outcome.
One of the challenges of data
gathering can be the diverse range of
quality, quantity and data collection
standards that exists across energy,
water and asset13
performance.
Desired outcome
Required action
Potential solutions
Physical variables
Organisational
infrastructure
Precinct programs
Systems of
organisation
that are required
to progress
towards the
desired outcome
or modify the
physical variables
at a precinct-scale
(urban design,
governance,
business models,
data etc.)
Business models – Community-owned,
public-private partnerships, municipality-owned,
government-owned, private monopoly
Incentives and disincentives – Fragmentation,
risk/reliance behaviours, shared value
Risk and Liability – Risk ownership, investment
timeframes, technology evolutions, regulation
Finance – Construction, procurement and ownership
Stakeholders structures – Responsibility management, influence, proximity, dependency,
representation and strategic intent
Decision making frameworks – Laws, policy, guidance and institutional structures
Planning / interest timeframes – Resilience and whole of life
Structure – Hierarchy, market or network governance
Strategic planning and land use – Role of planners; clarity in land use, infrastructure, approvals
and responsibilities, planning policy
Education and training
Enforcement and compliance
Market capability
Consumer awareness
Disclosure and data
Innovation and technology
Metering and monitoring
Smart grid
Finance and risk Information data and capability

3736
PRECINCT PROGRAMS
It is important to note that none of the
physical carbon variables or physical
infrastructure solutions can be realised
without the appropriate organisational
infrastructure. Each can be applied
with a different blend to enable the
desired outcome.
For example, supply of
solar generation for
precincts may be
enabled through
either a private third party-owned
microgrid, a community-owned
microgrid or a peer-to-peer
trading platform. Each have
different bearings on the
impact realised from the
infrastructure and the incentives
or dis-incentives for different
stakeholders within the precinct.
Figure 11 Precinct programs comprise physical and organisational infrastructure
Desired outcome
Required action
Potential solutions
Physical variables
Organisational
infrastructure
Precinct programs
Precinct programs
combine physical
and organisational
infrastructure
to support the
delivery of the
desired outcome.
Precinct
programs
Organisational
infrastructure
Physical
infrastructure
+ =
Photo 6: Bundaberg Shopping Centre,
Avoca, Queensland by Stockland
Photo supplied by Stockland
In this way, physical infrastructure
can be strategically paired with
organisational infrastructure to form
precinct programs that drive zero
energy (and carbon) ready outcomes,
as shown in Figure 11.

3938
Program name Physical infrastructure potential Organisational infrastructure potential Benefits
Low Carbon
Microgrid
Medium or
high density
New or existing
precincts
A low carbon microgrid enables a
single entity at a precinct-scale to
coordinate control of energy supply
and distribution. Some of the physical
infrastructure may include:
− Embedded network
− Local renewable energy supply
− Central energy plant
− Building Management System
integration and optimisation
− Smart grid and smart meters
− Swarm intelligence control systems
− Chillers / heat pumps
− Thermal networks and thermal meters.
(Note: gas cogeneration/ tri-generation
will possibly create challenges in
zero carbon)
− Waste to energy
− Wastewater heat recovery
− Electric vehicle integration
− Energy storage and peak shifting
− Integrated precinct photovoltaics (PV)
or other renewable energy inputs
− Precinct-scale batteries to manage
peak demand
− Ground or water sourced heat pumps
Ownership
− Wholly Publicly Owned
− Privately Owned – for profit
− Public Private Partnership (PPP), or
Joint Venture (JV) Model
− Concession Contract (Private or JV)
− Community Owned not-for-profit or
Cooperative Business model
− Business to Business arrangements
Controls
− Local energy distributer, local
planning controls
Finance
− Developer, green finance or
environmental upgrade agreements
(future rates)
Able to package zero carbon
through offsetting residual
and balancing energy use
across the precinct to
reduce peaks and improve
energy security
Is not matched by action
on efficiency
Microclimate
design optimisation
Medium or
high density
New or existing
precincts
Additional consideration of the site
layout, building design, surfaces and
landscape design with consideration of
thermal comfort and energy efficiency.
− Passive design considering orientation,
shading and breezes
− High albedo surfaces
− Appropriate use or recognition of
thermal mass
− Landscape design
− Green infrastructure
(plants, trees and water)
Ownership
− Community title or local government
Controls
− Local government development
controls and specifications
Finance
− Developer
− Council (special rates levy)
Managing external air
temperature can influence
heating and cooling demand
for a precinct, including
dwellings within a precinct.
Reducing external air
temperatures also facilitates
climate adaptation,
public health, amenity
and usability benefits.
Peer-to-peer trading
Medium density
New or existing
precincts
Peer-to-peer trading allows individual
owners within a precinct or within a
region with renewable energy capacity, to
trade energy. Infrastructure may include:
−Integrated precinct PV or other
renewable energy inputs
− Smart meters
− Shared batteries
− Electric vehicle integration
Ownership
− Ownership remains with building
owners or dwelling owners (tenants’
benefit, or action limited)
Controls
− Local distribution network regulations
− Technology and trading platform
capacity and security
Finance
− Subject to individual owners’
engagement
− Limited finance needed to enable peer
to peer trading
Enables energy prosumers
(consumers who can also
produce energy)
Is not matched by action
on efficiency
Used to reduce peaks,
improve energy security and
reduce energy wastage
Low energy and
carbon procurement
Medium or
high density
Existing precincts
Bulk procurement of assets or services
(lighting upgrades, PV, building tuning)
can significantly enhance precinct level
energy/ carbon and reduce costs of
action. Infrastructure may include:
− PV or battery procurement / installations
− Electrician or plumbing services
(hot water meters, servicing,
tuning, upgrading)
Ownership
− Shared agreements/ strata actions
Finance
− Pooled finance from owners/ tenants
Maintenance and tuning
can have significant energy
efficiency benefits
Cost savings of coordinated
tuning and upgrades in
residential buildings
Precinct energy
services company
(Energy as a
Service)
Medium or
high density
New or existing
precincts
An energy services company (ESCO) is a
firm that provides solutions for achieving
energy cost reductions, and whose
overall compensation can be linked
(in part or in full) to the performance of
the implemented solutions. It effectively
enables the breaking of the cycle of $ for
kWh and focusses more on the service
that the energy is providing. This in turn
drives the firm to seek optimal efficiency
and payback driving down consumption
to meet level of service expectations.
Infrastructure/ services may include:
− Light (lux)
− Heating/ cooling (space, water, pool)
− Mechanical (lifts)
− Electrical (appliance)
− Technology, metering and sub-metering
to monitor the level of service
Ownership
− Not for profit ESCO operator with
possibility of secondary energy
performance contracts
− Would most probably require a
microgrid
Finance
− With a third party ESCO owning
much of the energy assets, the capital
expenditure of the developer may
be lower
− ESCO could access green finance
This approach could deliver
a long-term low energy
(and carbon) transition as it
enables a move away from
energy being a product and
into a service.
Waste heat
capture / use
Medium or
high density
New or existing
precincts
Precincts have potential for a
number of waste heat sources
(HVAC, wastewater etc.).
− Better utilising waste low grade heat
in meeting the heating demands for
the precinct (can be at building or
precinct scale
Ownership
− Could be achieved at a building or
precinct-scale
− Could bridge building classes where
a commercial tenant HVAC waste
heat could be sold to a residential or
precinct pool
− Require a microgrid or embedded
network to ensure the shift is ‘bankable’
Can draw down
’carbon neutral’ energy from
waste heat
Can reduce the
anthropogenic heat from the
local environment
Table 3 identifies a range of potential
precinct level programs that
combine physical and organisational
infrastructure and have the potential
to have a positive physical impact
and support the delivery of the
desired outcome. For the purposes of
setting out potential programs, these
have been considered based on:
− Potential for high or sustained
energy or carbon mitigation, and
− Consideration of broader co-
benefits (resilience, affordability,
productivity, health).
This is not a comprehensive
list. It is provided as a basis for
considering the purposes of
identifying potential solutions that
may enable outcomes (see Section 5).
Proposed solutions should focus on
actions that drive the desired outcome
without locking in a particular
technology pathway and should
be structured to avoid perverse
outcomes. In Section 5 we outline a
suite of potential solutions that can
influence and enable the uptake of
precinct programs to achieve zero
energy (and carbon) ready outcomes.
Table 2 Examples of potential precinct programs

4140
Waste heat
capture / use
(continued)
− Heat exchangers
− Short thermal networks
It is important to note that domestic hot
water can be responsible for around
25% of household energy consumption.
May be seasonal in
supply and demand
Property Value
Capture
Medium or
high density
New precincts
Where an energy network is physically
constrained there may be an opportunity
to provide a precinct level solution
to enable the development outcome
and limit its impact on the precinct
network. Some of the physical
infrastructure variations could include:
− Peak energy reduction initiatives
− Coordination of optimised
passive design
− Local energy generation and storage
− Embedded network and precinct
energy management system
Ownership
− Would require a microgrid or embedded
network to ensure the shift is “bankable”
Control
− Local distributors’ ability to realise cost
savings and pass to developers (subject
to scale, impact and regulation)
Finance
− Developer avoided external costs to
enable development
− Potentially matched with development
yield variance if main constraint
Requires coordination
of demand and supply
alternatives (to a point only)
Central Utility Plant
High density
New precincts
In a major urban redevelopment of
appropriate mix and density there may
be opportunity to provide a central
utility plant to house and coordinate the
precinct energy, water, waste and data
services within a centralised purpose-
built facility. This could centralise the
ownership and management and
drive efficiencies across the utilities.
− Centralised plant facility
− Embedded networks and microgrid
− Distributed electricity, thermal, water,
waste and data facilities
Ownership
− As per the microgrid option above
− Structured as a Services Company
would drive continuous improvement
(e.g. ESCO)
Controls
− Local energy distributer, local planning
controls
Finance
− Developer, green finance or
environmental upgrade agreements
(future rates)
Gross Floor Area efficiencies
Anthropogenic microclimate
enhancement
Reduced servicing and
burden on strata
Economies of scale of plant
Ability to enable utilities as
a service
Centralised procurement
Continuous improvement
Precinct Level
Environmental
Upgrade
Agreements (EUAs)
Medium or
High Density
Existing precincts
A range of energy efficiency or energy
supply initiatives coordinated at a
precinct level
Ownership
− Owners, tenants and strata organisations
Controls
− Local government rates and
EUA processes
Finance
− EUA – ties energy efficiency funding to
the future rates at a level which removes
the cost to owner and tenant (where
the borrow quantum is structured to
pay back at the same rate as the cost
savings from the energy efficiency
achieved from the baseline)
− Special Rates Levy
Closes the financial loop
between the cost holder and
the benefit receiver
Potential for action
The current emergence of
precinct-scale solutions to drive
energy and carbon efficiency are a
new engineering and organisational
challenge. They require innovation,
commitment and risk. Precinct-scale
action is currently being driven
by innovators seeking to drive
outcomes beyond the regulatory
baseline and seeking efficiency
for end users and investors.
In terms of innovation process, these
are often referred to as the innovators
or early adopters. To realise the
potential opportunity requires the
innovation to become mainstream or
be taken up by the early majority or
late majority to realise momentum.
Coordinated action by multiple stakeholders
is required to overcome challenges and realise
precinct level opportunities. Community, owners
and tenants need to recognise and realise the
value of the action; and industry and government
need to coordinate action on the physical and
organisational infrastructure to create the value
potential from precinct-scale outcomes.

4342
POTENTIAL FOR ACTION
The barrier to innovation can be
referred to as ‘crossing the chasm’
(Figure 12) where, if the desired
outcome to be realised is sound,
there can be value in government
action to bridge the gap.
As the systems and technology
evolve, they often hit barriers in the
governance or regulatory frameworks
that were often set in place to deliver
on the intent and the process of
the traditional service models.
Where these can be identified early,
there is an opportunity for government
to recognise the potential benefits
to society, the environment and the
economy, and proactively act on
streamlining policy action, incentives,
research or education to help enable
the outcome being realised.
GOVERNMENT ACTION
In planning government action, be
it enabling mechanisms, targeted
policy actions or supporting
measures, it is important to:
− Recognise that realising precinct-
scale solutions will evolve,
so actions need to enable and
foster flexibility for emerging
innovations and technologies.
− Identify the role of the wider
community and industry
in delivering outcomes and
the appropriate role that
government can take.
− Understand that market and industry
are already acting at a precinct-
scale, and government action should
support and uplift these existing
structures, systems and solutions.
For government actions to address
key challenges and barriers and
support opportunities in precincts,
we need to define clear objectives.
These objectives have emerged with
consideration of the powers and
influence of each level of government
and the ability to drive zero energy
(and carbon) ready outcomes.
The proposed solutions presented in
the next section will contribute to the
achievement of these objectives:
1. Fully mobilise the strategic
urban and utility planning
process to enable zero energy
(and carbon) ready precincts.
2. Establish processes that enable
new forms of precinct energy
systems and coordination
of supply and demand.
3. Use government development,
procurement and funding to
drive market transformation.
4. Establish authoritative information
sources for zero energy
(and carbon) ready development.
AREAS OF POTENTIAL ACTION
For government policy to be effective,
it is important to ensure that policy
direction and action are based on
achieving clearly articulated outcomes.
There is always a risk in all policy and
regulation that they can lead towards
the wrong or a perverse outcome.
Commonwealth State and Territory Local
Control Australian Government Standards
National Construction Code
National electricity law and rules
Carbon pricing and renewable
energy goals
State and territory planning policy
and approvals (including Environment
Impact Statement)
Infrastructure planning standards
Utility service standards
Legislation and regulation
Local planning policy and approvals
Site planning and urban
design guidelines
Public domain infrastructure standards
Incentives Funding (grants, seed funding)
Low cost finance
Awards and recognition
Research funding
Tax
Funding
(grants, seed funding, subsidies)
Low cost finance
Tax (stamp duty, land tax)
Utility pricing
Developer contributions
Funding
(grants, seed funding, subsidies)
Rates
Planning rewards
Developer carbon levy
Developer contributions
Information Guidance
Data availability
Education programs and resources
Tools and rating schemes
Direct actions Programs
Procurement
Table 4 Examples of potential levers available to governments
Innovators
THE
EARLY
MARKET
THECHASM
THE
MAINSTREAM
MARKET
Early adopters Early majority Late majority Laggards
Figure 12 Crossing the innovation curve chasm, adapted from Moore (1991)
This report has sought to provide
an effective high-level overview of
precinct-scale outcomes, opportunities
and barriers to direct the development
of a range of potential solutions.
It is recognised in all cases, that
further development would prove
valuable to ensure the direction
of the potential solution provides
a clearly articulated approach
to supporting the outcome.
Governments can employ different types of levers to enable, regulate or
support the private sector and market. These are listed in Table 4.

44 45
Potential solutions set out the
actions that could be taken by the
Commonwealth, state and territory,
and local governments to enable or
dismantle barriers to appropriate
precinct programs. These actions
are programs, controls, incentives,
guidance and direct actions.
Potential solutions emerged
through a filtering process based
on the following criteria:
− Practical and cost effective for
stakeholders, while delivering
a net societal benefit.
− Ability to drive zero energy
(and carbon) ready outcomes.
− Potential to deliver co-benefits, such
as cost-savings, job creation and
health benefits for home occupants.
− Systems that support desired
outcomes and allow for future
technological enhancements and
continuous improvement as the
precinct continues to decarbonise.
− Benefit from Commonwealth,
state and territory and local
government engagement.
The Trajectory identifies three
core areas of action. They are:
Enabling mechanisms required
to unlock and support the private
sector to deliver outcomes.
These provide the foundations
for improvements and underpin
other policies and activities.
Targeted policy actions needed to
overcome specific market barriers
and address perverse outcomes
that may occur from the introduction
of enabling mechanisms.
Supporting measures to ensure
both the enabling mechanism and
targeted policy actions are delivered
efficiently and cost-effectively.
Potential solutions
This section outlines a suite of potential
solutions that can influence and enable the
uptake of precinct programs to achieve
zero energy (and carbon) ready outcomes.
Solutions focus on actions that drive the desired
outcome without locking in one pathway and
are structured to avoid perverse outcomes.
Photo 7: Burwood Brickworks Shopping Centre,
Burwood East, Victoria.
Photo supplied by Frasers Property Australia.

46
Potential solutions presented in this section have
been grouped into three areas of actions.
Considerations for each potential solution were:
47
To align with the workplan and suite of policies in the Trajectory,
our potential solutions have been divided into the same three core areas:
Develop building codes and regulations that accommodate precinct-scale zero energy and
carbon initiatives.
Potential solution 2 Review planning controls to take greater consideration of energy and carbon at precinct-scale.
Establish an information / knowledge hub for zero energy (and carbon) ready precincts,
including practical information on precinct-scale distributed energy systems.
Potential solution 6 Expand the mandatory commercial performance disclosure scheme to include
residential developments.
Potential solution 7 Continue to improve the rules, regulations, and incentives around precinct-scale distributed
energy systems.
Potential solution 8 Establish energy and carbon performance standards in government-initiated precinct developments.
Supporting measures
assist with the transition most cost-effectively
overcome specific market barriers
Enabling mechanisms
provide the foundations for improvements
Potential solution 9 Seek to reward zero energy (and carbon) ready development with planning incentives.
Extend the scope of government energy funding and finance programs to enable the growth
of precinct-scale distributed energy projects.
In each state and territory, develop at least one showcase precinct development that
combined planning, design, governance and business models required for
zero energy (and carbon) ready precincts.
Potential solution 12 Establish an information base of costs and benefits for developers and green finance
providers to help improve access to capital.
POTENTIAL SOLUTIONS

4948 49
Enabling Mechanisms
Potential solution 1 Develop building codes and regulations that accommodate precinct-scale zero
energy and carbon initiatives.
Goals and targets
− The Building Code of Australia better defines the potential from precinct action.
− Planning systems are coordinated with building codes to deliver the most effective solutions.
− Increased participation rate in Climate Active Carbon Neutral Standard for Precincts.14
Precinct types Ability to impact
Precinct programs impacted
Barriers
− Lack of direct mandate in building codes and regulations leading to a reluctance to go beyond BAU at precinct-scale.
− Lack of clear policy for precinct and place-based planning of utilities can lead to uncoordinated outcomes
for precincts and communities. Infrastructure and utilities planning is currently sector-led and siloed.15
− Planning policy encompassing energy and carbon is limited and inconsistent across jurisdictions.
− Lack of understanding and communication about the roles of stakeholders in the planning system.
Pathway
Commonwealth Government
− Seek to incorporate definition of precinct and zero energy (and carbon) ready precincts into National Construction Code
2022 update.
− Identify role of planning schemes in aligning with precinct definition and regulating precinct-scale zero energy (and
carbon) ready initiatives.
− Seek to acknowledge effective precinct-scale solutions and precinct programs in Nationwide House Energy Rating
Scheme (NatHERS) assessment or other housing energy ratings where appropriate.
State and territory governments
− Consider carefully the interface between the planning system and the building code in addressing energy opportunities.
− Where precinct solutions are proposed, ensure the resilience of the energy physical infrastructure and organisational
infrastructure are robust.
Local governments
− Local government could train planning staff on energy and precinct-scale solutions to enable effective planning,
approvals and enforcement.
− Support State/Territory planning policy for strata structure and management plans by providing assistance from planners.
CommonwealthMedium
New
High
Existing
Low carbon microgrid
Microclimate design optimisation
Low energy and carbon procurement
Precinct level EUAs
State and territory Local
14 The ‘Climate Active Carbon Neutral Standard for Precincts’ (Precinct Standard) is a voluntary standard to manage greenhouse gas emissions and to
achieve carbon neutrality. It provides best-practice guidance on how to measure, reduce, offset, validate and report emissions that occur as a result of the
operations of a precinct.
15 Infrastructure Australia. (2018). Planning Liveable Cities: A place-based approach to sequencing infrastructure and growth.
Potential solution 1 Develop building codes and regulations that accommodate
precinct-scale zero energy and carbon initiatives.
Potential solution 2 Review planning controls to take greater consideration of energy
and carbon at precinct-scale.
Potential solution 4 Establish an information/ knowledge hub for zero energy
(and carbon) ready precincts, including practical information on
precinct-scale distributed energy systems.
Enabling Mechanisms
POTENTIAL SOLUTIONS
Photo 8: District Information Model and Management system for
Energy Reduction for the European Commission. © Arup

5150 50
Potential solution 2 Review planning controls to take greater consideration of energy and
carbon at precinct-scale.
Goals and targets
− All jurisdictions to have adopted planning for zero energy (and carbon) ready precincts in their planning schemes.
− Better coordination of land use and utility infrastructure planning between planning agencies and across jurisdictions.
Barriers
− Limited and inconsistent planning policy encompassing energy and carbon across jurisdictions.
− Lack of understanding and communication about the roles of stakeholders in the planning system.
− Utilities not taking a development-planning lens on planning.
− Innovation currently driven at local government level however jurisdictions often siloed.
− Fragmented approach to precinct-design and coordination.
− Lack of triggers in the existing planning system despite many opportunities to unlock innovation through
planning and urban design (e.g. passive design and infrastructure planning optimisation).
Pathway
− Convene state and territory planning and energy representatives to establish consistent framework of definitions,
targets and strategies related to zero energy (and carbon) ready outcomes in the planning system, in line with the
‘Trajectory for Low Energy Buildings’.
− Embed energy provision, energy efficiency and carbon performance into any national settlement strategy.
− Consider the appropriate balance between controls, incentives and guidance in planning systems to encourage
appropriate and adaptable action at building, precinct or network level.
− Require that servicing options are presented in the approvals phase alongside the statement of serviceability, which
demonstrate whole-of-life impacts at a multi-stakeholder level. Consider the potential of a requirement for a strategic
energy master plan for major precinct-scale developments.
− Seek to incorporate zero energy (and carbon) ready precinct outcomes as part of planning reform.
− Ensure state level policies (e.g. BASIX) effectively consider benefits from precinct action.
− Modify gas and electricity distribution licence conditions to drive distributors to take account of zero energy (and carbon)
ready commitments in their network planning.
− Unlock developer contributions through a review of state/ territory infrastructure charges to contribute towards zero
energy (and carbon) ready infrastructure.
− Provide land to encourage precinct development with attached sustainability requirements.
Local governments
− Support better integration between land use and infrastructure planning in local government planning schemes.
− Educate local government planning teams on energy, carbon, building and precinct potential.
CommonwealthMedium
New
High
Existing
Microclimate design optimisation
Waste heat capture use
Property value capture
50
POTENTIAL SOLUTIONS
Enabling Mechanisms
Potential solution 3 Align energy utility planning with development planning
Goals and targets
All jurisdictions have requirements for energy distributors to proactively engage with the development
planning process on a whole of life costs basis and reflect this into utility planning.
Barriers
− Lack of clear policy direction for precinct and place-based planning of utilities.
− Limited and inconsistent planning for energy and carbon outcomes across jurisdictions.
− Highly regulated utilities and precinct solutions are difficult to factor in either their servicing strategies or
commercial interests.
− Little incentive for property developers to design precincts to permanently reduce electricity demand or capture the
reduced the costs of grid augmentation.
− Lack of monitoring, analysis and reporting on actual operational energy use and carbon.
Pathway
− Engage with gas and electricity distribution companies to strengthen the linkages and process for development
and spatial planning in utility planning processes. Over time, seek to incorporate these requirements into essential
services regulation.
− Work with distributors to consider dynamically and adaptively managing peak (kVa) demand forecasts which set the
infrastructure servicing requirements to respond to building and precinct-scale action and accounting appropriately for
the avoided investment. This will enable utilities to factor the benefits of peak demand reduction that can be realised
from a precinct level solution to avoid network upgrade costs.
− Increase the rate of rollout of smart grid and smart meters to enable greater transparency in the network and
consumer response.
Medium
New
High
Precinct energy services company
Waste heat capture/ use
State and territory
Enabling Mechanisms
51

5352 53
Establish an information/ knowledge hub for zero energy (and carbon)
ready precincts, including practical information on precinct-scale distributed
energy systems.
Goals and targets
− Establish and resource an information hub for regular updates on new innovations
and case studies, with a foreseeable life of at least five years.
− Standardise definitions of carbon, low carbon, zero carbon, zero energy and net zero at all levels.
− Support continued growth in access to the website (measured in website hits, downloads).
Barriers
− Lack of consumer or industry understanding of the potential costs and benefits of precinct-scale solutions.
− The industry’s willingness to act on the precinct-scale opportunity is based on understanding. This can be enabled
through reliable information; however, the precinct-scale is a rapidly evolving landscape where information is currently
fragmented and therefore the data base needs to be dynamic.
− No central evidence-based information source that can rapidly disseminate best-practice, although availability and
insights available from data have transformed since the Your Development guidance from 2009-11.
− Lack of evidence and guidance on what works and what doesn’t in relation to precinct-scale distributed energy systems,
including practical information and capability of how to deliver, monitor and govern distributed energy systems.
Pathway
− Work with state and territory governments to establish an authoritative website that centralises information and resources
on zero energy (and carbon) ready development to a wide audience.
− Develop a governance and funding structure that ensures the website is maintained and regularly updated.
− Leverage the Clean Energy Finance Corporation (CEFC), the Australian Sustainable Built Environment Council (ASBEC),
the Property Council of Australia and Green Building Council of Australia finance, direction and knowledge products.
− Incorporate and highlight the knowledge products of Cooperative Research Centres (where relevant).
− Work with relevant energy stakeholders (e.g. Australian Energy Market Operator (AEMO) Australian Renewable Energy
Agency (ARENA) and CEFC) to contribute practical information on precinct-scale distributed energy systems to the
information hub.
− Work with the Commonwealth to establish an authoritative website that centralises information and resources on zero
energy (and carbon) ready development.
− Collect information (e.g. content, lessons learnt) from showcase projects, including practical experience of precinct-scale
distributed energy systems and make publicly available template contracts and agreements for community-scale models
on the information hub.
− Contribute resources and case studies to website.
Local governments
− Demonstrate and share information on shared public-private ownership and governance models for precinct-scale
distributed energy systems through local government-led precinct projects.
− Improve energy and carbon literacy for planners and utility service engineers.
− Contribute resources and case studies to website.
CommonwealthMedium
New
High
Existing
Precinct level EUAs
52
POTENTIAL SOLUTIONS
Enabling Mechanisms
Potential solution 5 Develop a Precinct Information Management (PIM) system
Goals and targets
− Standardisation of precinct level data on energy and carbon and an agreed database
schema that enables transparent accounting for precinct scale systems.
− Established a national standard for Precinct Information Management data sharing, privacy and security.
Barriers
− No consistent data standards or communication platform process for precinct energy management.
− Lack of clarity around precinct data ownership and potential use.
− Current precinct-scale management systems have limited transparency / interchangeability, are adapted from Building
Management Systems and are generally proprietary tools.
Pathway
− Develop a nationally accepted PIM system that enables the design and delivery of precinct-scale sustainability actions.
This should be linked to the National Electricity and Gas Market customer/ meter data system.
− Initiate with Standards Australia a process for setting a Precinct Information Management data sharing standard, like the
AS ISO 16739 for Building Information Management (BIM).
− Develop a database schema as the skeleton structure that represents the logical view of the entire database. It would
define how the data is organised and how the relations among them are associated. It would formulate all the constraints
that are to be applied on the data.
− Clearly articulate the transparency, privacy and security protocols for precinct energy systems.
Medium
New
High
Peer-to-peer
Waste heat capture / use
Commonwealth
Enabling Mechanisms

54 55
POTENTIAL SOLUTIONS
Potential solution 6 Expand the mandatory commercial performance disclosure scheme to include
residential developments
Goals and targets
− Operational energy use and reporting mandated for residential development.
− Implement mandatory performance disclosure for residential properties at the point of sale or lease.
− Introduce minimum energy efficiency standards for rental properties.
Barriers
− Information asymmetry at the point of sale or lease regarding the expected energy performance, comfort and potential
future energy costs of a home.
− Mandatory energy performance disclosure limited to commercial developments and the ACT Residential
Disclosure Scheme.
− Better energy performance not currently valued by the market and consumers are unable to find or fund energy efficient
homes even if willing to pay a sustainability premium.
− No Australian minimum energy efficiency standards for rental properties, which are typically less energy efficient and have
less distributed energy than owner-occupied residences.
Pathway
− Establish responsible body to develop a framework for operational energy use and reporting for residential developments,
similar to the National Australian Built Environment Rating System (NABERS).
− Define a nationally consistent rating tool for existing residential properties to report on operational energy use.
− Implement a residential performance disclosure scheme, mandating performance disclosure at point of lease and sale.16
− Develop a program and training for the residential building sector to market these benchmarks.
− Support training for real estate agents, volume home builders and land developers to deliver a sales narrative that
underscores the benefits of these benchmarks.
− Deliver communication messages explaining the value of sustainability features to renovators and homebuyers, including
at the point of sale and lease.
− Coordinate and fund a nationally consistent approach to deploying minimum energy efficiency standards for existing
rental properties.
− Support implementation of a residential performance disclosure scheme and associated training and communication.
− Deploy minimum energy efficiency standards for existing rental properties similar to New Zealand’s ‘Healthy Homes
Guarantee Act’.
Local governments
− Coordinate metering and monitoring capabilities with utilities to support compliance with the Residential Performance
Disclosure Scheme.
− Work with Commonwealth, state and territory governments to develop a single national rating scheme for residential
properties to report on. Local governments can provide benchmarks for market comparison and contribute to the
development of a best practice governance model based on NABERS.
CommonwealthMedium
New
High
Existing
All, because of increased market transparency and value
Potential solution 6 Expand the mandatory commercial performance disclosure
scheme to include residential developments.
Potential solution 7 Continue to improve the rules, regulations, and incentives around
precinct-scale distributed energy systems.
Potential solution 8 Establish energy and carbon performance standards in
government-initiated precinct developments.
Photo 9: Solar Yennora Distribution Centre, Yennora,
New South Wales by Stockland
Photo supplied by Stockland

56
POTENTIAL SOLUTIONS
Potential solution 7 Continue to improve the rules, regulations, and incentives around precinct-scale
distributed energy systems.
Goals and targets
− Jurisdictions to have consistent electricity market rules that enable precinct-
scale distributed energy or peer-to-peer trading.
− Incentives to direct precincts to take the most energy, carbon and economically efficient actions.
Barriers
− Tendency for energy market regulation to lag in this rapidly evolving field.
− Unclear and non-uniform grid connection requirements create immediate barriers for
property owners and developers considering distributed energy projects.
− Regulatory and cost barriers for non-network participants into this market, acting as strong disincentives.
− Existing regulatory and revenue models do not enable innovation or distributed energy response.
− The National Energy Objectives (NEO) do not factor carbon or resilience
limiting these factors from consideration at the highest level.
Pathway
The Australian Energy Market Commission (AEMC) has given the former COAG Energy Council a comprehensive
package of detailed advice on laws, rules and regulations to protect consumers and improve choice in embedded
networks. The Commonwealth Government should progress this advice, and through the AEMC rule-making process:
− Continue to facilitate change to electricity market rules to support decentralised trading models where net economic,
social and environmental benefit can be demonstrated and realised.
− Review the energy market barriers experienced by distributed energy, energy efficiency and built environment
stakeholders, and consider their concerns in the context of energy market processes and reforms.
− Consider alternative cost allocation methodologies for setting network prices e.g. consider c/ kWh/ km pricing, rather
than applying a ‘top-to-bottom’ cost allocation method used in electricity and gas infrastructure pricing which is the
current practice.
− Consider the reduction of threshold participation requirements for participation in the ancillary services markets
(i.e. System Restart Ancillary Service, Voltage Control and Frequency Control Ancillary Services.)
− Support the AEMC to integrate the results of AEMO and ARENA virtual pilot plant trials into rule-making process.
− Consider the recommendations from the CEFC and Property Council of Australia’s joint report,
‘Distributed Energy in the Property Sector: Unlocking the Potential’.
− Consider the opportunity of including carbon as a factor into the National Energy Objectives to direct coordinated action.
− Support the Commonwealth Government rule-making process to ensure consistency across jurisdictions.
− Consider in energy utility regulations, incentives and disincentives.
CommonwealthMedium
New
High
Existing
State and territory
Precinct level EUAs
16 As per Recommendation 6.1 in ‘Every Building Counts for Federal Government’ (Property Council of Australia & Green Building Council Australia, 2019),
and the ‘Trajectory for Low Energy Buildings’ which committed to implementing a national energy efficiency disclosure scheme by the end of 2025.
17 Clean Energy Finance Corp & Property Council of Australia (2018). ‘Distributed Energy in the Property Sector: Unlocking the Potential’. 57
Potential solution 8 Establish energy and carbon performance standards in government-initiated
precinct developments.
Goals and targets
All jurisdictions to have mandatory requirements for ambitious energy and carbon performance in
development standards for government projects. These should align with the commitment to zero
energy (and carbon) ready buildings outlined in the Trajectory for Low Energy Buildings.
Barriers
− There is a need to direct government development, procurement and funding to initiate market transformation,
which is not currently being achieved by the private sector alone.
− Government commitment to high performance is not yet normalised across all assets, infrastructure, procurement
and development to de-risk investment in zero energy (and carbon) ready precincts.
− Governments’ substantial buying power and development pipelines have not been used to build capacity in the
supply chain for zero energy (and carbon) ready outcomes.
− Limited real-life case studies of zero energy (and carbon) ready precincts available for stakeholders, including
consumers, to visit and learn from. These are necessary for industry to adopt new methods and products.
Such projects provide the opportunity for data collection, monitoring and evaluation. This data informs effective rule
making and provides credible recommendations.
Pathway
− Seek to develop zero energy (and carbon) ready performance requirements for Commonwealth Government-led
precinct-scale development, such as by the Department of Defence and in City Deals. This can include setting specific
requirements and key performance indicators in tender documents.
− Include local supply chain preference in procurement requirements. Government procurement can build market capacity
and guarantee demand to address demand risk.
− Seek to develop zero energy (and carbon) ready performance requirements for state and territory government-led
precinct-scale developments, such as by government land organisations, City Deals and health infrastructure assets.
Local governments
− Seek to develop zero energy (and carbon) ready performance requirements for local government-led precinct-
scale developments, including civic precincts and where local government is the landowner, and seek consistency
and support for action from state and territory or Commonwealth Government where appropriate.
CommonwealthMedium
New
High
Existing
Microclimate design
Waste heat capture / use

Precincts to Support the Delivery of Zero Energy

Precincts to Support the Delivery of Zero Energy

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