The ACT Government has announced that a new minimum energy efficiency standard will be introduced for ACT rental properties. These new regulations will go into effect on April 1, 2023, with a phase-in period that will last until November 30, 2026.
The new regulation standards mean that homes with no ceiling insulation or insulation with a rating lower than R2 will be required to upgrade their insulation so it reaches the new minimum standard of an R5 rating. The minimum standard will apply to both private and public rental properties.
The Minister for Energy and Emissions Reduction has stated that the minimum standard is increasing to assist renters with their quality of life and energy costs. The ACT Government has implemented a phase-in period as well as no-interest loans in an effort to assist rental providers in complying with the new regulations.
What is an Energy Efficient Standard?
The energy efficiency standard is referring to the R rating of the ceiling insulation in a property. The R value is the measurement of an insulation sheet’s ability to resist heat flow. The ratings range from 1.5 to 7, and the higher the number, the more effective the insulation sheet.
1 April 2023
The new minimum energy efficiency standard comes into effect.
All rental properties will be required to be compliant with the new standards within nine months of a new lease being signed.
Rental providers and property managers must now also provide information in all advertising and leases in regards to whether or not a property meets the minimum standard.
30 November 2026
The majority of rental properties will be required to be compliant with the new minimum energy efficiency standard.
1 December 2026
All properties entering the rental property market will be required to comply within three months of signing a new lease agreement.
Strata and Community Living
At this stage, the new standards only require compliance in relation to ceiling insulation, meaning that their impact will be limited to top-floor apartments and some B-class properties. The landlords for these properties must either comply with the new standards or provide an exemption (more information on exemptions here).
If an Owners Corporation refuses to approve ceiling insulation upgrades, the landlord will receive a temporary exemption. The Owners Corporation will have to have a special meeting or include the request for an upgrade in the AGM agenda so a decision can be made and included in the meeting minutes.
The Sustainable Household Scheme
To assist with the costs associated with the new standards, the ACT Government’s Sustainable Household Scheme will expand to give rental providers support through the option to access a zero interest loan of up to $15,000 to cover the cost of installing new insulation.
How to Check Your Insulation Rating
The ACT Government has advised that they believe approximately 60% of rental properties built since 1997 should already be compliant with the new standards.
To check the rating of insulation in your rental property, you can try the following methods:
Check your property’s Energy Efficiency Rating (EER). This can be found in your property contract.
Estimating the R-value based on the thickness of the insulation.
Hire a professional who is qualified to assess the insulation and determine the R-value. These professionals can include certified insulation installers, building assessors, or accredited national scorecard assessors.