What is a home energy rating?
A home energy rating measures a properties energy efficiency potential (thermal performance). In theory a robust home energy rating should enable a home owner to make a more informed decision when buying, selling, renting or investing in property. The assessment is normally completed from a building plan and currently the home is not reassessed once it is built.
Currently, there are many different home energy rating assessments available for the property owner to measure energy and/or and water efficiency. These reports are a great way to understand the strong and weak points of your home’s energy efficiency. To help you make sense of all the home energy rating tools (software) and the various degrees of detail they offer we have compiled an easy reference comparative table. It outlines all the tools available and their features; what they assess, their cost, and the rating they provide.
There are two main situations when you would use a home energy rating.
1. Mandatory Home Energy Rating Assessments
Since 2006, all new homes in Australia must be energy rated or comply with specified construction standards. These make up the majority of the energy ratings available on the market. Some tools (the name used for the software program that generates the rating) are used for new homes and others are used for existing homes with assessments required to be done at the point of sale or lease. Existing homes in every state except the ACT do not require a home energy rating.
Mandatory Home Energy Rating Assessment Programs for each state
- NatHERS (National): The Nationwide House Energy Rating Scheme for new homes
- BASIX (for NSW only): The Building Sustainability Index for new home and renovations over $50,000
- EER (for ACT only): Energy Efficiency Rating (EER) for all homes (new and existing) at the time of sale.
2. Voluntary Home Energy Rating Assessment
The second reason you would use a home energy rating assessment is to gain an understanding of the energy efficiency potential of your home in order to know how to improve it.
- NABERS HOME Rating (National Australian Built Environment Rating System) This is a good tool to benchmark your energy use and compare your home’s energy and water use to other homes. And you can do it yourself online!
- NABERS Energy Explorer Do it yourself online and get recommendations to improve the energy efficiency of your home.
The ACT in focus – understanding an EER rating.
The ACT is the only Australian State or Territory all homes, new and existing, are assessed for energy rating at the time of sale and these ratings must be displayed during any sales process and there are fines for breaches. In the ACT an Energy Efficiency Rating, or EER, is a rating used to identify the energy efficiency of houses in the ACT. Houses can achieve 0 to 10 stars in the rating scheme. Houses with a higher EER are more energy efficient and therefore use less energy for heating and cooling, generate lower greenhouse gas emissions, are more comfortable and healthier to live in and have an improved sale value.
The EER report also outlines what changes could be made to increase the star rating of the property. An EER number, which is the star rating, is clearly marked on property signboards and print and online property advertising in the ACT.
Research recently released by the Univeristy of Melbourne by Dr Georgia Warren-Myers, shows that people are valuing energy efficiency and making decisions based on the energy efficiency of a property. The 7-8 star home receiving a premium.
“The EER rating has become one of the factors that people consider when they’re looking. They see the number of bedrooms, the number of bathrooms, carparks – and they see the energy star rating,” she says.
Dr Warren-Myers says the jump in prices for seven-star properties suggests homeowners recognise the value of going above the minimum six-star standard for new homes.
“Home owners know that new homes meet a minimum six-star level, and want to be better than the standard,” she says. “They’re going to that seven-star mark to differentiate themselves from that baseline. Interestingly, properties with eight stars only earned a 2.8 per cent premium, which she says may reflect the small sample size. Only 0.3 per cent of the 31,000 sold properties covered in the study had eight-star ratings. At the bottom end of the ratings, zero-star and one-star rated properties sold at a 2.8 and 2.4 per cent discount to three-star rated properties.
An information flyer released by HEAT (The Home Energy Advise Team) called EER Ratings Explained – 2012 July 12 identifies the relationship between EER and estimated running costs for a property.
In 2007, the Department of the Environment, Water, Heritage and the Arts (DEWHA) commissioned the Australian Bureau of Statistics (ABS) to produce a statistical report modelling the relationship between EER of houses and house prices in the ACT. Published in 2008, it looked at the case of detached houses sold in the Australian Capital Territory in 2005 and 2006. It modelled the relationship between energy efficiency attributes and house price and showed a direct correlation between house price and the star rating. It showed that for each increase in half a star the capital value of the property increased by 2%. Importantly this shows how using an EER rating can enable you to begin to understand how to take control of your running costs and capitalise your property with energy efficiency. As energy prices increase this represents a greater opportunity.