The SA government needed a defined methodology for estimating utility costs savings to tenants resulting from environmental upgrades to buildings, including energy and water efficiency.
Building Upgrade Finance tackles the split incentive in leased buildings, where the building owner incurs the cost of the upgrade and the tenant benefits from reduced utility bills. It allows the owner to pass on costs equal to the tenant’s utility savings from the upgrades.
As part of the introduction of Building Upgrade Finance in SA, Common Capital was engaged to find a transparent, fair and effective way for these savings to be measured for all parties involved.
With extensive experience in NABERS and other measurement methodologies, Common Capital was able to provide high level technical insight to create a methodology with the right balance between technical accuracy and usability.
Our aim was to define a methodology that was clear, fair and transparent, and would piggyback on existing standards and frameworks to minimise the cost and administrative burden to participants.
We conducted a comprehensive review of national and international measurement methodologies and forecasting frameworks for energy and water savings and renewable generation. We compared this with the requirements of the SA Building Upgrade Finance to design a process and set of rules that both drew on best practise and leveraged existing frameworks.
We designed and effective methodology that sets out roles and responsibilities for everyone involved in the process, ensures the regulations are complied with and measures the benefits delivered.
The ‘no worse off’ methodology is currently available on the SA government website
and is being used by SA building owners participating in Building Upgrade Finance.