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Building Energy Efficiency Disclosure
Act 2010
Summary of the act

Enacted by Federal Parliament on 28 June 2010, the Building Energy Efficiency Disclosure Act 2010 (“the Act”) is designed to reduce carbon emissions and improve energy efficiency in commercial office buildings by underscoring current deficiencies. Further, the Act will highlight the energy efficiency of large commercial office buildings in order to better inform potential purchasers and lessees.

What is caught under the Act?

The obligations outlined in the Act will apply to owners and tenants of commercial office buildings.

For the Act to apply, the commercial office space’s net lettable area must exceed 2000m²

The obligations will apply to offers to sell or lease, and invitations for offers to purchase or lease, relevant commercial offices space.

Consequences of complying with the Act

Buildings that are captured under the criteria in the Act will be required to obtain a Building Energy Efficiency Certificate (BEEC).

The elements that a BEEC discloses include:

1. the energy efficiency star rating of the building (based on the National Australian Built Environment Rating System – “NABERS”);
2. an assessment of the energy efficiency of the building lighting; and
3. an energy efficiency report outlining possible improvements.

Fundamental obligations of compliance

In order to comply:

1. a vendor or lessor must register its BEEC before it sells or leases a building;
2. any advertisement for the sale or lease of a building must include the NABERS star rating; and
3. a prospective purchaser or lessee can either obtain a copy from the online registry or may simply ask the vendor or lessor to supply them with a copy of the BEEC – if a request is made, the vendor or lessor must oblige within a reasonably practicable time period.

If an existing lease does not require a tenant to provide the relevant information, the Act gives accredited assessors the authority to compel tenants to provide data and access in order to prepare a BEEC.

Breaching the obligations

A breach of any of the aforementioned obligations may attract a maximum penalty of $110,000 for each breach.

Additional penalties will be incurred for every day that the vendor or lessor remains in breach.

Exemptions

The vendor or lessor (for leases over 12 months) is not entitled to an exemption, nor will it be granted automatically.

Only lessors of leases for 12 months or less will be automatically exempt from the BEEC requirements.

The vendor or lessor must apply in writing, accompanied by a fee, to the secretary for an exemption before the obligation for disclosure arises.

Under section 17(3), exemptions may be granted for:

1. buildings used for police or security operations;
2. buildings where the characteristics make it impossible to assess the energy efficiency or lighting in accordance with standard assessment methods defined in section 21; or
3. buildings that fall into a class prescribed by the Regulations as being exempt at the discretion of the secretary. This is likely to include newly constructed buildings, buildings that have undergone significant renovations and transactions where the sale of a building is through the sale of shares or units.

Timing

When will the obligations come into effect?

The Act came into effect on 1 July 2010. However, disclosure requirements will only commence on the “implementation day” – a date yet to be determined, but said to be before 31 December 2010.

Requirements

A NABERS star rating requires 12 months of continuous data. NABERS is a retrospective rating, however, data more than 4 months old is considered stale and cannot be used as part of the 12 month raw data.

Transition period

If vendors or lessors have an existing NABERS rating prior to the implementation date, it can be used for up to 12 months in lieu of a BEEC.

Expirations

BEEC’s will be current for 12 months only, commencing on the date the certificate is issued.

The next step

Owners of office buildings should undertake an accredited energy efficiency assessment and obtain a rating prior to implementation day. Failure to do so will result in delaying the sale or lease of commercial office space.

However, if they are unable to do so, owners should start gathering the required data to expedite the assessment process when it does take place.

Further, owners should consider any upgrades or refurbishments that would increase the building’s energy efficiency or may qualify the building for an exemption.