Tenants copping energy neglect

The energy efficiency ratings in Canberra’s rental market are appalling, according to a survey published this week, and it is almost certainly mirrored everywhere else in Australia.

Some enforcement on recycling bins would help.

It means renters are paying more for energy, particularly electricity, and more carbon is unnecessarily belching into the atmosphere. The reasons are fairly obvious; the remedy less so.

Basically, landlords do not care about energy efficiency. Tenants pay the power bills. Rents are almost totally determined by location, space and newness of kitchen bathrooms, not by things like orientation; insulation quality and double-glazing which are all but invisible to prospective renters – until the first mid-winter or mid-summer power bill arrives.

There is simply no incentive for landlords to make their dwellings more efficient.

The compulsory energy-efficiency rating system for rental or purchase properties verges on the useless. Anecdotal evidence from real-estate agents suggests that buyers and renters pay little or no heed to it.

Indeed, there is a solid argument that all the paper and fuel that goes into the production of energy-efficiency ratings makes them a minus, not a plus, for the environment.

The compulsory energy-efficiency requirements in the building code, on the other hand, are effective. They result in more efficient buildings rather than merely telling you how bad an existing building is without do anything about it. 

The building requirements were introduced over howls of outrage from the building industry that they would push up costs. But in the long run, of course, they reduce the overall cost to the people who use the building over its lifetime. Moreover, if everyone has to comply no builder is getting a competitive cost disadvantage.

So what is to be done to improve the lives of tenants and reduce the carbon footprint?

Landlords have to be given an incentive to make dwellings more efficient. A very quick way to do that would be to require landlords to provide a basic level of electricity to all tenants free. In return, after the first quarter they would be permitted to increase the rent by an equivalent or slightly lower amount as the  electricity bill.

Landlords would then have an incentive to put on solar hot water and solar voltaic cells.

In smaller blocks of units where the ratio of roof space to the number of units makes solar worthwhile it could be run through the body corporate with a single meter for all the units and dividing the bill according to unit holding.

Incidentally, there would be a saving there because power companies typically charge a connection fee for each metered unit, and that is getting larger all the time, as power companies sell less electricity as more people go solar.

The same scheme could apply to commercial properties.

In the 1960s and 1970s, lots of blocks of units had a single meter and the power company divided the bill according to unit holding. That was seen as unfair to frugal unit holders. It also gave little incentive to be frugal. As a result nearly all those blocks were gradually rewired with separate meters.

With solar arrays, however, separate metering is not practicable. In any event, the saving in metering costs would more than make up for any unevenness in use among the units.

Single metering for water and splitting the bill is still commonplace in older blocks of units. People often split bills in restaurants without worrying too much about whether someone had a little more than someone else.

Also, the idea that landlords should provide a base level of electricity to tenants is not alien to tenancy law. Landlords are required by law to provide a whole raft of things under various state and territory tenancy regimes.

Of course, it would require action by state and territory governments. But they should welcome the opportunity. In our federation (and that of the United States, for that matter) our federal government shows every indication to do as little as it can get away with on the climate crisis and global heating.

The states and local government, in both places, however, are alert to the need to act.

Just as one nation can make the excuse that their effort would have little impact on the global scene, so can one state, one city, one town, one corporation or one individual. Equally, each of those entities can apply the Kantian moral imperative and ask, what if everyone took this stand and act accordingly.

However, it helps if there is a financial incentive for an entity to do the right thing and an enforced penalty for not doing the right thing.

Interestingly, the Federal Government showed this week it is capable of such thinking on an environment matter. The Minister for Waste Reduction, Trevor Evans, proposed that all governments give the recycling industry a boost by mandating a certain level of recycled materials in every project.

It is a pity it does not want to apply the same thinking to renewables.

Maybe it has something to do with the fact that the recycling industry employs 50,000 people and has a well-organised industry lobby group, the Waste Management and Resource Recovery Association.

The waste scheme comes as Indonesia and China have rejected waste from Australia. In the case of Indonesia it was a matter of the waste being contaminated by too much plastic of the wrong kind, requiring Indonesian workers to do the hazardous task of separating it.

Again, we should return to the Kantian imperative. How hard can it be for people to put the correct material into the recycling bin? After more than 20 years it is obvious that mere education is not enough. It has to be combined with a bit of enforcement.

Perhaps every ratepayer should be issued with a recycling credit on their rates bill combined with random inspections which if shown to be unsatisfactory result in the cancelling of the rates credit.

In the case of recalcitrant tenants, there would again be an incentive for landlords to do something about it, as they do in other leasing matters.

The human impact on the planet means we are going to have to get smarter and more responsible lest we choke in our own muck.


This article first appeared in The Canberra Times on 27 July 2019.

One thought on “Tenants copping energy neglect”

  1. Eminently sensible proposals, but how do you prevent ABC 7.30 Report and the dear old Canberra Times, immediately after some pollie takes up the ideas, going out and finding some poor old self-funded retiree struggling to survive on the income of only three or four rental properties who will be “devastated”? I can visualise the white-haired old lady, probably in a wheelchair!

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