— Mount Alexander Sustainability Group

Retrofit Net Zero Housing

In-line with Mount Alexander Sustainability Group’s target of Zero Net Emissions (ZNET) by 2030, it was identified that the aging rural housing stock must be brought up to a low emissions standard to enable us to achieve this. The focus is not on cost payback but on emission reduction, although the cost effectiveness of measures will inform the retrofit choices made.

In keeping with a ZNET strategy, we would be looking to move households away from gas wherever possible, or at least, to create a viable path for them to make this move in the near future. The gas supply charge, typically about $350 per year, would thus be saved.

We have sought 5 sets of data to enable us to plan this.
1. DELWP Scorecard data for central Victoria
2. REMPLAN community census data
3. MASG Renew Survey
4. Sustainability Victoria’s Comprehensive Energy Efficiency Retrofits to Existing Victorian Houses
5. Mount Alexander Shire Development Services data

This has enabled us to identify a population of houses we can draw on, identify the likely retrofits they would need and develop a budget to enact such retrofits. We have also consulted widely with experts within Sustainability Victoria, DELWP, BZE, NatHERS, and experts in this sector, Alan Pears and Euan Williamson.

We maintain that if we can bring poor performing houses up to NatHERS 6 Stars, then the addition of Solar PV on these can bring them to a near ZNET target rating utilizing the RE Scorecard of 9 or 10. The houses assessed in SV’s study on the Energy Efficiency Upgrade Potential of Existing Victorian Houses, found an average NatHERS star rating of 1.81 for pre-2005 houses, and an average rating of
1.57 for the pre-1991 houses.

From 1991, houses will continue to be poorly insulated and generally energy inefficient despite some BCA standards applied. However, there are 2 major steps in the energy efficiency of the housing stock after this. These are the introduction of mandatory 5 star NatHERS rating in 2004 and of 6 stars in 2010. Given the delay between Building Approval and the actual build completion, these can be considered effective from 2005 and 2011 respectively. Mount Alexander Shire Development Services have provided number of approvals in these categories. Its possible some may not have proceeded but these would be very few.


  • 2005 – 2011 521

  • 2011 – 2020 1264

  • Estimate based on 125 houses per year would suggest that between 1991 and 2004 inclusive

  • would mean 1,750 houses built in this period.

  • This would leave 6,720 built prior to 1991 or 75% of the housing stock.

Based on SV and DHHS studies, we have arrived at what seem to be reasonable assumptions for energy usage in unrenovated rural housing. An assumption is made for an average household of 59,800 MJ/yr for natural gas and 4,160 kWh for electricity. The ghg coefficient for electricity is declining and now sits at around 1.03 kg/kWh, and the coefficient for natural gas is 0.05543 kg/MJ. A house with this level of consumption would produce around 7.6 tonnes of CO2-e per year at the moment.

Some key resources:

The Plan

We are not seeking to replicate the studies already undertaken, but to embark on a project to apply the knowledge already documented by Sustainability Victoria to the task of raising the standard of the Shire’s existing housing stock. The SV project did not model every upgrade possibility and we would seek to expand this to achieve the higher performance.


As reported on by Ian McNicol of Sustainability Victoria, there are a range of benefits that could come from the MASG retrofit program, some will go to the householders and some will go to society more generally. Following the retrofit there will be a range of savings “streams”, including:


Energy bill savings: If you undertake a comprehensive upgrade to the building shell (insulation and draught sealing), major appliances such as heating and water heating, and add rooftop PV this energy bill saving could be very large.


Improved thermal comfort and thermal safety: A comprehensive building shell upgrade should significantly improve the natural thermal comfort of the home in winter, and should also improve the thermal comfort in summer as long as it has good shading. This would be expected to translate to a significant health benefit and reduced medical costs for the households, especially the low income households in the least efficient houses – some of this will reduce household medical expenses and some will reduce government health costs. Studies have been undertaken by the respected UK organisation the Building Research Establishment, who have undertaken work on this for the UK government and the European Union. They estimated that the investment in measures to reduce the risk of houses being too cold or too hot (e.g. mainly building shell upgrades) resulted in a 7.1 year payback based on the reduced medical costs to the NHS system.


Reduced greenhouse gas emissions: The on-going greenhouse gas savings due to the energy savings have an economic value. One issue is that over time Victoria’s electricity supply will become much less greenhouse intensive, so the greenhouse savings from efficiency upgrades that reduce electricity consumption and the greenhouse offset provided by the rooftop PV system will reduce over time. On the flip side, the economic value of the greenhouse gas savings – expressed in $ per tonne of carbon-dioxide equivalent (CO2-e) will increase.


Reduced electrical peak demand: The building shell, appliance and PV upgrades reduce the electricity demand of the houses. This can be on the peak (hottest) summer day and also the peak (coldest) winter days. This reduction in demand reduces the future investment required in the electricity generation and supply infrastructure. For Victoria this is currently estimated as $1,050 per kW. Victoria currently has it’s highest electricity demand on hot summer days. However, if there is a strong trend towards electrification of gas heating water heating and cooking, this could add significantly to the morning and evening electricity demand peaks in winter. In this case, building shell and heating efficiency upgrades will be an important way to manage the growth in this peak demand.


Economic stimulus to build back better: Another great benefit is the economic stimulus a large-scale retrofit project can provide. The recent IEA Sustainable Recovery report found that of all the energy-related measures that they studied, the retrofit of existing buildings and the installation of rooftop PV systems generated the most employment. This work tends to be quite labour intensive. Also, the building shell upgrades could make use of locally produced products, so this could increase local manufacturing. This work is great for our local economy providing jobs across a range of skills and services.


Get off gas: Shortfalls have been predicted in Victoria’s natural gas supply as early as 2023 (in the worst case) and 2024. Measures that significantly improve the efficiency of gas use (e.g. building shell and heating upgrades), or the replacement of gas appliances with high efficiency electrical ones could be one way for Victoria to reduce it’s gas demand. Note there is no clean way of producing and delivering gas likely to be available in the life of this project and as usage of gas drops in industrial use, we would expect it to become more expensive to the householder.


The Victorian Environmental Upgrade programme is now available for residential buildings providing the council takes up the opportunity this offers. This will provide a painless means of paying off the costs incurred in the upgrade, and by financing over 20 years, the payments will be less than currently being paid to the electricity and gas utilities.

Savings in Emissions of Programme

Greenhouse Gas emissions are more difficult to nail down as we are seeing a move from brown coal to gas generation. However, what we are also finding out is that gas is not that different from coal once the fugitive emissions are taken into account.

As more renewables come on stream the level of emissions change from electricity generation and from gas extraction and distribution change. However we are looking at a slow progression and projects such as this can be part of the solution.


The GHG coefficient for electricity is declining and now sits at around 1.03 kg/kWh, and the coefficient for natural gas is 0.05543 kg/MJ. A house with this level of consumption indicated by the selected population would produce around 7.6 tonnes of CO2-e per year at the moment. If we can reduce the energy consumption to 40% as per the table above, then we would expect the emissions to be reduced to 3.04 tonnes of CO2-e. If we satisfy this demand with Solar PV, then this can be reduced to zero.


If we were to save 7.6 tonne of CO2-e per year for 510 houses then this would represent 3,876
tonnes saved.

Household Energy Costing Savings

The Retrofit looks to have a zero net energy use as a result.

We have considered the current rates announced (2021) by the principal retailers. If we look at the average gas usage of 59,800 MJ over a year we would expect this to cost $350 per year supply charge and $1,255 in usage over the year. If we look the average electricity usage of 4,160 kWh over a year we would expect this to cost $383 per year supply charge and $874 in usage over the year. A total cost of energy $2,862 per year.


Of these only the electricity supply charge of $383 will remain. Thus a saving of $2,479 on the average house above. Recent analysis by Sustainability Victoria of older houses, adjusted to incorporate 5kW of Solar PV, suggests that the cost of energy would be $2,450 per year and supports this.


Financing over 20 years through a supplement to council rates via the Victorian Environmental
Upgrades programme could see it fully paid off and provide a net annual saving in the order of $200 until completion of the term After this of course, the full saving of $2,450 per year would be realised.


Note a householder who was capable of paying the cost upfront, would get a full return on their
investment in 11 years.

The Pilot

A pilot has been undertake with the support of Common Equity Housing Limited (CEHL) and the Lord Mayors Charitable Foundation.

10 local houses were selected from the CEHL houses initially known as the Forrest Creek Housing Coop. While not a perfect fit to the population to be targeted, they presented a good platform to validate the process. This is nearing completion.


Tasks trialled included:
1. Legal advice on impact of RTA, EUA and LGA
2. RE Scorecard Assessments of 26 houses
3. Select houses for Pilot (10 houses)
4. Safety and suitability inspection
5. Plan of Retrofits
6. Selection of Contractors
7. Retrofits, Test, Tune and Monitor install
8. Solar PV install
9. Monitoring and Analysis (12 months)
10. Post Retrofit Inspection
11. Blower Door Testing
12. Scorecard Revision (10 houses)
13. Tailored Building User Guides
14. Performance Review
15. Project Management