Introduction
The purpose of this bill is ensuring warm, healthy residential properties are the norm in New Zealand, not the exception. This is achieved through the introduction of minimum energy performance standards for residential rental accommodation, providing a legal framework that achieves efficiency and health gains for tenants and taxpayers while enabling the capital investment to be reflected in the value of the property.
Background
The residential sector in New Zealand consumes approximately 12% of the country's energy usage or 34% of its electricity. Despite the high proportion of energy usage, New Zealand homes are generally energy inefficient by OECD standards. The majority of the 1.6 million occupied houses in New Zealand do not have sufficient levels of insulation or efficient clean heating devices and a significant proportion do not meet World Health Organisation guide lines for adequate internal temperature. The economic, health and environmental (CO2) costs of this inefficiency are considerable and present New Zealand with real challenges to overcome.
Rental homes are the last remaining sector of the residential buildings market where residents may have no options to keep warm. Significant grants have been made available for landlords over a number of years, but uptake has been poor.
The uptake of significant grants by landlords has been poor, primarily because the capital cost is not reflected in the value of the property. There is currently a split incentive regarding efficiency investments. Tenants pay the power bills but often do not stay long enough to reap the benefits of any capital outlay. Landlords find it difficult to recoup any capital investment through capital gains. Rental residential buildings are a classic case of market failure which can be remedied by a standard. The Australian experience shows that making energy efficiency ratings a matter of public record raises the capital value of improved properties and improves competition between landlords, with benefits accruing to tenants, landlords and the state through lower health costs.
This bill requires that standards be in place by October 2012, that all residential rental accommodation be efficiency rated and publicly notified by 2015, and that all residential rental accommodation meets the minimum energy efficiency standards by 2018.
Clause by clause analysis
Clause 1 is the Title clause.
Clause 2 provides the Bill comes into force on the day after the date
on which it receives the Royal assent.
Clause 3 provides that the Bill amends the Energy Efficiency Conservation Act 2000 (the principal Act).
Clause 4 amends section 7 by providing that the Minister must ensure minimum energy performance standards for residential rental accommodation are in effect from 1 January 2018.
Clause 5 amends section 36 by providing for regulations governing residential rental accommodation.
Clause 6 inserts new section 36A that :
• requires that the Minister prescribe regulations regarding minimum energy performance standards for residential accommodation
• requires the Minister to prescribe the method by which the energy performance assessments are to be made part of the public record
• requires the Minister to prescribe any transitional arrange ments necessary to enable compliance of all residential rental accommodation by 1 January 2018.
Energy Efficiency Conservation (Warm Healthy Rentals) Amendment Bill
Member's Bill
Contents
1 Title
2 Commencement
3 Principal Act amended
4 Responsibilities of Minister
5 Regulations
6 New Section 36A inserted
36A Residential rental accommodation
The Parliament of New Zealand enacts as follows:
1 Title
This Act is the Energy Efficiency Conservation (Warm Healthy Rentals) Amendment Act 2010 .
2 Commencement
This Act comes into force on the day after the date on which it receives the Royal assent.
3 Principal Act amended
This Act amends the Energy Efficiency and Conservation Act 2000.
4 Responsibilities of Minister
Section 7 is amended by adding the following paragraph after paragraph (d):
"(da) ensuring minimum energy performance standards for residential rental accommodation are in effect from 1 January 2018:"
5 Regulations
(1) Section 36(1) is amended by inserting new paragraph (aa) after paragraph (a):
"(aa) prescribing minimum energy performance standards for residential rental accommodation:"
6 New Section 36A inserted
The following section is inserted immediately after section 36:
"36A Residential rental accommodation
"(1) The Governor-General must, on or before 1 October 2012, by Order in Council made on the recommendation of the Minister,
make regulations that prescribe—
"(a) the definition of residential rental accommodation:
"(b) minimum energy performance standards for residential rental accommodation:
"(c) requiring specified classes of persons to provide, on the request of the Authority, evidence in the specified form that a minimum energy performance standard prescribed under paragraph (b) has been complied with:
"(d) requiring, for the purposes of paragraphs (a) to (c), that all residential rental accommodation meet the minimum energy performance standards by 1 January 2018:
"(e) prescribing, for the purposes of paragraphs (a) to (c), any transitional arrangements with respect to the energy performance of residential rental accommodation between 1 October 2012 and 1 January 2018:
"(f) prescribing, for the purposes of paragraphs (a) to (c) the form and manner of testing or verifying the energy performance of residential rental accommodation:
"(g) requiring, for the purposes of paragraphs (a) to (c), specified classes of persons to certify, in the prescribed heform and manner, as to the energy performance of residential rental accommodation:
"(h) prescribing, for the purposes of paragraphs (a) to (c), the means by which certified compliance enters the public record , describing the energy performance of residential rental accommodation:
"(i) prescribing, for the purposes of paragraphs (a) to (cdate prior to 1 January 2015 by which a public record
stating the energy performance of all residential rental accommodation will be required:
"(j) requiring specified classes of persons to supply prescribed information to the Authority for the purpose of compiling statistics on energy efficiency, energy con-servation, and the use of renewable sources of energy:
"(k) prescribing offences in respect of the contravention of,or non-compliance with, any provision of any regulations made under this section:
"(l) prescribing the amount of the fines that may be imposed in respect of any offences against any regulation made under this section, which fines must be an amount not exceeding $10,000.
"(2) Before making regulations under this section, the Minister
must—
"(a) publicly notify the proposal to make the regulations; and
"(b) give interested persons a reasonable time, which must be specified in the notice published under paragraph (a), to make submissions on the proposed regulations; and
"(c) consult with such persons as the Minister in each case
considers appropriate."
