For some time, their rhetoric had been; “we have a $billion contribution to energy efficiency”. Whilst the promised accelerated depreciation for green retrofits may not have changed behaviour to a great degree – given the up to 3 year wait required toreap the benefit – this about-face is significant as it displays a lack of real commitment to the carbon reduction agenda.

Energy efficiency improvements to the existing building stock is the single most cost effective and fastest way to reduce our collective carbon footprint.

Napier & Blakeley have established a specialised unit, called NB Verdigris, to project manage and procure funding for the sustainable retrofit of existing buildings. We are not aware of any of our clients deferring the commencement of their projects to obtain the benefit of this phantom tax break.

The problem is that some projects may have been delayed, exacerbating the general construction slow down.

Will the Government attempt in another way to make good its promise to act as a catalyst in improving energy efficiency in the existing building stock?

View the Property Council of Australia’s summary of the Budget highlights.

For any assistance with your assets energy efficiency modelling, potential, costs and retrofit planning and management, please contact Peter Frith.

Contact

Transaction & Asset Advisory
Rob Howells – 03 9915 6300 – rhowells@napierblakeley.com
Alastair Walker – 02 9299 1899 – awalker@napierblakeley.com

Sustainable Property Solutions
Peter Frith – 03 9915 6300 – pfrith@napierblakeley.com

Development Advisory & Quantity Surveying
Craig Smith – 03 9915 6300 – csmith@napierblakeley.com
Peter Hammond – 02 9299 1899 – phammond@napierblakeley.com
Paul Cosker – 07 3221 8255 – pcosker@napierblakeley.com

Property Depreciation & Insurance
John Mathew – 03 9915 6300 – jmathew@napierblakeley.com
Paul Mazoletti – 07 3221 8255 – pmazoletti@napierblakeley.com

The sustainable and mainstream property industry and energy efficiency associations in unison have slammed the action as an about face on the federal government’s significant previous support and encouragement for building energy retrofits. In countless statements the government confirmed it understood that energy reduction in buildings was the cheapest source of carbon abatement.

See our detailed coverage on the reaction, Bad budget news for green buildings …and some scraps

Senator Milne (pictured at the launch of Green Cities 2o12 with – left to right – Jane Henley, World Green Building Council, Nils Kok Maastricht University, Romilly Madew, Green Building Council of Australia) said the budget move was “bad faith” with the industry which had agreed to defer the tax breaks measure in order to rework its structure and make it more effective.

“It is also bad faith with an industry who agreed to defer this measure because they wanted to get it right and are now being punished for doing due diligence.

“This is one of the aspects of the Budget that we are very unhappy with and we will continue to press the government to fix it.”

“It is quite wrong of the government to think that the carbon price will be enough to drive the greening of commercial buildings when evidence around the world highlights the array of non-price barriers to this action,” Senator Milne said.

“We need to provide better incentives.”

Quantity surveyors and tax consultants Napier & Blakeley said that while the tax breaks would not change behaviour given the long lead times before property owners could claim a benefit, the signal was a strong negative for the sustainable retrofit industry.

“This about-face is significant as it displays a lack of real commitment to the carbon reduction agenda,” the company said in a client note emailed on Thursday.

The company’s NB Verdigris arm, set up to project manage and procure funding for sustainable retrofits, had not seen any clients defer projects start in order to claim the benefits of the “phantom tax breaks”.

At the same time it was now possible that some projects would be deferred – and this in an environment that would exacerbate the current construction slow down, the firm said.

Written by Tina Perinotto
Displayed on The Fifth Estate – sustainable property news and forum – May 10, 2012