Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2008-2009-2010
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
BUILDING ENERGY EFFICIENCY DISCLOSURE BILL 2010
SUPPLEMENTARY EXPLANATORY MEMORANDUM
Amendments and New Clauses
to be Moved on Behalf of the Government
(Circulated by authority of the Minister for Climate Change, Energy
Efficiency and Water, Senator the Hon Penny Wong)
GENERAL OUTLINE
Amendments to the Building Energy Efficiency Disclosure Bill
The Building Energy Efficiency Disclosure Bill ('the Bill') provides for
the establishment of a new national scheme (the Commercial Building
Disclosure (CBD) Scheme or 'the scheme') for the disclosure of certain
energy efficiency information relating to commercial office buildings.
These amendments to the Bill correct a small number of drafting errors, and
also provide for:
. the exclusion from the scheme of certain short term leases;
. certain requirements in relation to recognising a person or body as
an issuing authority;
. certain requirements for using energy ratings and assessments, other
than those recognised as building energy efficiency certificates
('BEECs'), during the transition period; and
. the maximum penalties per day for continuing contraventions of a
number of civil penalty provisions.
The Bill has been the subject of inquiries by the Senate Standing Committee
on Environment, Communications, and the Arts, and the Senate Standing
Committee for the Scrutiny of Bills. These amendments flow from matters
raised in the course of those inquiries and recommendations made by the
Committees.
The amendments relating to short term leases explicitly exclude leases and
subleases of 12 months or less from the scope of the disclosure obligations
under the scheme, provided certain criteria are met.
The amendments relating to the recognition of issuing authorities outline
matters about which the Secretary must be satisfied before recognising a
person or body as an issuing authority. Broadly, an issuing authority will
only be recognised if it is competent in applying the methods and standards
applicable to assessments undertaken for the purposes of obtaining BEECs,
and able to establish appropriate administrative systems for the proper
issuing of certificates.
The amendments concerning the transitional arrangements will provide
transitional assistance to industry before and during the transition period
for the scheme (the first 12 months of the scheme). The amendments do this
by recognising certain non-BEEC energy ratings and assessments as
sufficient to meet the disclosure obligations in the Bill during the
transition period. The amendments also ensure that information required
for the purposes of obtaining a recognised rating is able to be obtained,
and that this information is not misused.
The amendments relating to penalties amend the provisions relating
particularly to ongoing contraventions. The Bill provides that if a
contravention of a civil penalty clause occurs, a new contravention occurs
on each subsequent day that it is not rectified. The amendments operate so
that the maximum penalty that applies for contraventions on the second and
subsequent days is lower than the penalty for the first day.
These amendments reflect the Government's cooperation with and assistance
to industry in establishing a robust national scheme that will provide
credible and meaningful energy efficiency information to prospective
purchasers and lessees, while also helping to reduce Australia's greenhouse
gas emissions.
Financial Impact Statement
Funding of $5.3 million over four years was committed by the Government in
the 2009-10 Budget to support the development and implementation of the
scheme. The allocation of this funding commenced in 2009-10. This funding
is intended to cover both the initial phase of the scheme, covering office
buildings, and the expansion of the scheme over the coming years to include
other types of commercial buildings. Administration of the scheme will be
undertaken with the objective of moving to full cost recovery at the
cessation of this funding.
NOTES ON CLAUSES
Item (1)
Clause 11 No sale, lease or sublease without a building energy efficiency
certificate
1. These amendments to clause 11 operate to remove the disclosure
obligations in circumstances where the lease or sublease has a term of
12 months of less from disclosure obligations, provided certain
criteria are met.
2. New subclause (6) provides that the obligations under subsections (1)
to (4) will not apply if an offer is made to let or sublet a building
or an area of building, if:
. at the time the offer is made, the proposed term of the lease or
sublease is 12 months or less; and
. a term of more than 12 months is not proposed at any time while the
offer is continuing.
New subclause (8) provides that the proposed lease term includes any
options to extend the lease or sublease. For example, if there was a
proposed lease term of six months with an option to extend for another
12 months, the total proposed lease term would be 18 months. The
clause 11 disclosure obligations would therefore apply in relation to
that lease.
3. New subclause (7) provides that the obligations under subsections (1)
to (4) will not apply if an invitation is made to make offers to let or
sublet a building or an area of building, if:
. at the time the invitation is made, the proposed term of the lease
or sublease is 12 months or less; and
. a term of more than 12 months is not proposed at any time while the
invitation is continuing.
4. As noted above, subclause (8) provides that for the purposes of working
out the proposed lease term, any options to extend the lease or
sublease must be included.
Item (2)
Clause 12 Rights of a prospective purchaser, lessee or sublessee
5. This amendment to clause 12 limits the right of a prospective lessee or
sublessee of a building to give a notice to provide a BEEC under clause
12. The amendment will mean that there is no right to give a clause 12
notice if the proposed lease or sublease is only for a short period,
provided certain criteria are met. This is consistent with the
amendments to clause 11 which exclude short term leases and subleases
from the scope of the scheme in certain cases.
6. New subclause (5A) provides that no notice to provide a BEEC may be
given under subclauses (2), (3), (4) or (5) if:
. the term proposed for the lease or sublease at the time the offer or
invitation is made is 12 months or less; and
. a term of more than 12 months is not proposed at any time while the
offer or invitation is continuing.
7. Consistently with the amendments to clause 11, any options to extend
the lease must be included when working out the proposed term for the
lease (see new paragraph (5A)(a).
Item (3)
Clause 13 Building energy efficiency certificates
8. New subclause (7A) provides that a person or body will not be
recognised as an issuing authority unless the Secretary is satisfied
that the person or body:
. has the competency to apply the assessment methods and standards
determined under clause 21; and
. has systems in place to ensure that BEECs are issued in good faith.
9. Subclause (7A) limits the general discretion of the Secretary to
recognise a person or body as an issuing body under subclause (7). The
requirements of competency and good faith will provide guidance for the
Secretary or delegate and assist in any review of a decision to
recognise an issuing authority.
Item (4)
Clause 14 Building Energy Efficiency Register
10. This amendment corrects a drafting error by substituting 'or' for 'and'
in subparagraph 14(3)(b)(i). This brings the power of the Secretary to
delete BEEC particulars of an area of a building in line with the power
in relation to a whole building (in paragraph 14(3)(a)). It is
intended that the inappropriateness of either the energy efficiency
rating or the lighting assessment of an area will be sufficient to give
the Secretary grounds for deleting the particulars of a BEEC on the
Register. It is not intended that the inappropriateness of both is
required.
Item (5)
Clause 15 Advertisements to include energy efficiency ratings
11. This amendment to clause 15 operates to remove the obligation to
include energy efficiency ratings in advertisements for leases or
subleases that have a term of 12 months of less. Any options to extend
the lease must be included when determining whether the proposed lease
has a term of 12 months or less. For example, a six month lease term
that includes an option to extend for another 6 months would fall
within the exception. However, the exception would not apply in the
case of a proposed six month lease term with an option to extend the
lease for another twelve months.
Item (6)
Clause 23 Satisfying energy efficiency disclosure obligations during the
transition period
12. These amendments to clause 23 relate to the recognition of non-BEEC
ratings as sufficient to satisfy disclosure obligations during the
transition period.
13. Subclause (1) specifies that the transition period is for 12 months
beginning on the day of implementation.
14. Subclause (2) will now operate to recognise certain ratings given
during the transition period as well as before. A rating will be
recognised if it is made before or during the transitional period by a
person or body that is recognised as an issuing authority at the start
of the transition period. It is presently expected that the NSW
Department of Environment, Climate Change and Water will be recognised
as an issuing authority at the start of the transition period.
15. By extending recognised ratings to include those made within the
transition period, these amendments make it easier for persons who are
not yet ready to apply for BEECs on the implementation date. This
provides a greater period of transition and is especially important for
persons who are already in the process of obtaining a rating but will
only obtain it after the implementation date.
16. The following subclauses operate so that a recognised rating will in
effect be equivalent to a BEEC, for the purposes of satisfying a
disclosure obligation, if the rating is valid, current and registered
(as set out in subclauses (9) to (11) - see notes on those subclauses
below). Both buildings and areas of buildings are covered by these
subclauses.
17. Subclauses (3) and (4) have the effect that a valid, current and
registered recognised rating will satisfy the obligations in clause 11
that require a valid and current BEEC to be registered at the time of
any offer or invitation to sale, lease or sublease.
18. Subclauses (5) and (6) have the effect that giving a person a copy of a
valid, current and registered recognised rating will satisfy the
requirement in subclause 12(6) to give to another person a valid,
current and registered BEEC.
19. Subclauses (7) and (8) have the effect that a valid and current
recognised rating will satisfy the requirement in clause 15 to include
a valid and current energy efficiency rating in an advertisement for
the sale, lease or sublease of a building or an area of a building.
20. Subclause (9) provides that a rating will be valid if the issuing body
considers that the rating is appropriate, based on assessment methods
and standards that are substantially similar to those determined under
paragraph 21(1)(a). It is intended that the assessment of a recognised
rating should be substantially the same as the assessment of a BEEC.
21. Ratings issued before the transition period will need to be assessed
according to substantially similar standards that are in effect at the
start of the transition period. This is important to ensure, for
example, that for those ratings made a reasonable period prior to the
implementation of the CBE Scheme, recognition will only occur where the
assessments for those ratings are consistent with those of the BEEC
Scheme. Ratings made during the transition period will need to be
assessed according to standards (which are substantially similar to the
paragraph 21(1)(a) standards) that are in force at the time the ratings
are issued.
22. Subclause (10) provides that a rating will be current in the period
beginning at the time it is issued and ending either at the time stated
on the rating as the expiration date of the rating, or the end of the
transition period, whichever is earlier. The effect of this is that
all recognised ratings must expire at the end of the transition period
if not before. This would ensure that the recognised rating is not
relied upon indefinitely and the transition period is actually used to
transition towards obtaining a BEEC within 12 months of the
implementation date.
23. Subclause (11) provides that a rating will be registered if it is
included in a register electronically maintained by the issuing
authority and if that register is available for inspection on the
internet. This establishes registration requirements which are
substantially similar to those that apply in relation to BEECs under
subclause 14(6).
24. It should be noted that the issuing authority will be required to
handle any personal information contained on recognised ratings in
accordance with relevant privacy legislation.
23A Information gathering during the transition period
25. This additional clause provides the circumstances in which the
information gathering powers of clause 18 apply in relation to
assessments carried out for the purposes of obtaining recognised
ratings.
26. Subclause (1) provides that the information gathering powers will apply
when a person requests an assessment from an issuing authority assessor
(which is defined in subclause (2)). The request must occur before or
during the transition period. The person must be requesting the
assessment so that the person can apply for a recognised rating in
order to satisfy an energy efficiency disclosure obligation. This
extends the operation of subclause 18(1) to recognised ratings.
27. An issuing authority assessor is defined in subclause (2) as a person
accredited by the issuing authority to perform assessments of buildings
for the purpose of applying for recognised ratings.
28. Subclause (3) has the effect that the powers given to accredited
assessors under subclauses 18(2)-(12) that relate to information
gathering will apply equally to an issuing authority assessor before or
during the transition period.
29. Subclause (4) provides that the information gathering powers under
clause 18 apply where a notice is given by an issuing authority
assessor under subclause (3). This means that an issuing authority
assessor has the same information gathering powers as an accredited
assessor. This also means that a person who receives a notice from an
issuing authority will have to comply with clause 18 in the same way as
if that person received the notice from an accredited assessor.
30. Any confidential information given to an issuing authority assessor
will be protected. The issuing authority will be required, under an
agreement with the Commonwealth, to ensure that the contract of
engagement between the issuing authority and the issuing authority
assessor includes appropriate clauses dealing with the handling of
confidential information.
31. Subclauses (5) and (6) provide for exemptions to be granted by the
Secretary from a requirement to provide information. Persons may apply
to the Secretary for an exemption, in accordance with the requirements
of subclauses 18(8) and 18(9). The Secretary may grant an exemption in
relation to any matter that is set out in subclause 18(10). Any
exemption is taken to be granted under subclause 18(10). This means
that the Secretary will be required to notify the applicant about the
outcome of the exemption application, in accordance with subclause
18(11).
32. Subclause (7) provides that the offences created under subclause 19 do
not apply if the information was given to the issuing authority
assessor in compliance with a notice given by the issuing authority
assessor under subclause (3). This provides protection for the issuing
authority assessor that is equivalent to the protection (in subclause
19(2)(a)) that is accorded to information copied, recorded, used or
disclosed for the purpose of obtaining a BEEC.
Item (7)
Clause 33 Auditing Authority
33. The amendment to this clause changes a reference to 'the' auditing
authority to 'an' auditing authority in subparagraph (4)(a)(ii). This
corrects a drafting error and makes the subparagraph consistent with
the rest of the clause.
Item (8)
Clause 33 Auditing Authority
34. This amendment corrects a drafting error by substituting 'or' for 'and'
in subparagraph 33(4)(b)(i). This brings the obligation of an auditing
authority to notify the Secretary in relation to the appropriateness of
a rating or assessment for an area of a building in line with the
obligation in relation to a whole building in paragraph 33(4)(b). It
is intended that the inappropriateness of either the energy efficiency
rating or the lighting assessment of an area will be sufficient to give
rise to an obligation to notify the Secretary. It is not intended that
the inappropriateness of both is required.
Item (9)
Clause 34 Auditors
35. The amendment to this clause changes a reference to 'the' auditing
authority to 'an' auditing authority in subclause (4). This corrects a
drafting error and makes the subclause consistent with the rest of the
clause.
Item (10)
53 Civil Penalty Orders
36. The clause is amended to include additional subclauses (5A), (5B), (5C)
and (5D) and to make subclause (5) subject to these additional
subclauses. The amendments limit the penalty for certain
contraventions where the contravention continues for more than one day.
Under the civil penalty provisions in clauses 11, 15 and 18 of the
Bill, each new day of contravention is a separate contravention to
which the maximum penalty can be attributed. The effect of these
amendments will be that for every day after the first day of
contravention, the maximum penalty is less than the maximum penalty for
the first day of the contravention.
37. Subclause (5A) relates to ongoing contraventions of clause 11. Clause
11 imposes disclosure obligations on constitutional corporations in the
context of selling, leasing and subleasing buildings and areas of
buildings. New subclause (5A) operates to limit the pecuniary penalty
given in respect of each day after the first day on which a
contravention of clause 11 continues. The amendment operates so that,
in cases of ongoing contraventions, the maximum civil penalty for each
day after the first day of contravention is reduced to 100 penalty
units.
38. Subclause (5B) relates to ongoing contraventions of clause 15. Clause
15 imposes obligations on constitutional corporations in relation to
advertising buildings and areas of buildings for sale, lease and
sublease. New subclause (5B) operates to limit the pecuniary penalty
given in respect of each day after the first day on which a
contravention of clause 15 continues. The amendment operates so that,
in cases of ongoing contraventions, the maximum civil penalty for each
day after the first day of contravention is reduced to 100 penalty
units.
39. Subclause (5C) operates to limit the pecuniary penalty given in respect
of each day after the first day on which a contravention continues in
relation to giving information within a period specified in a notice
under subclause 18(2). New subclause (5C) operates so that, in cases
of ongoing contraventions, the maximum civil penalty for each day after
the first day of contravention is reduced to 20 penalty units for an
individual and 50 penalty units for a body corporate.
40. Subclause (5D) operates to limit the pecuniary penalty given in respect
of each day after the first day on which a contravention continues in
relation to giving access to a place at a day and time specified in a
notice under subclause 18(4). New subclause (5D) operates so that, in
cases of ongoing contraventions, the maximum civil penalty for each
after the first day of contravention is reduced to 20 penalty units for
an individual and 50 penalty unites for a body corporate.
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