Episode 4: NCC 2022 Across the States: VIC, ACT & NSW Explained (Part 2)
Episode 4
NCC 2022 Across the States: Victoria, the ACT and New South Wales
23 March 2026 · 41 minutes · Part 2 of 2 · Hosted by Brian Haines, Matthew Graham and Andrew Hooper
Summary
Part two completes the tour of how NCC 2022 has actually been implemented, covering Victoria, the Australian Capital Territory and New South Wales — and the three could hardly be more different.
Victoria takes up half the episode, because its treatment of renovations and additions is the most complicated regime in the country. The team work through Practice Note EE-04 method by method, the discretion available under Regulation 233, the quiet disappearance of the rainwater tank requirement, and the three kilowatt solar provision that technically applies to every renovation in the state.
The Australian Capital Territory adopted NCC 2022 with essentially no variations, and adds a licensing requirement that surprised two of the three hosts. New South Wales moved first, in October 2023, and the transition was brutal: a jurisdiction where four-star houses had been complying under BASIX was asked to reach the equivalent of seven, with a certificate expiry clock running and a planning portal that could not cope.
In this episode
0:25Victoria: seven stars, and what was lost in the transition
0:56Where the rainwater tank requirement actually went
5:09Practice Note EE-04 and the two methods of compliance
6:17Rating the single renovated house as if it were new
8:17Why the certified rating should show the truth, not the theory
9:26The two-house method, and the change that broke it
11:31Is assuming insulation in an existing ceiling fair?
13:53Which upgrades give the best return on an existing dwelling
16:19Automating the volume calculations, and why consistency matters more than method
18:36The three kilowatt solar backstop nobody can explain
20:36PN55 to EE-03 and EE-04: a document with a history
22:16The ACT: NCC 2022 adopted whole, with one extra licence
25:20ACTHERS, FirstRate 4, and software nobody can be trained in
30:52New South Wales: first to move, and the three-month clock
32:44From heating and cooling caps to a total load cap
34:36The carve-out that still allows 4.5-star homes to comply
36:00Why New South Wales has no Whole of Home requirement
38:07Passive House as a compliance pathway
Key points
Victoria lost the rainwater tank, and the trail goes cold
Under the previous code a dwelling could take six stars plus either a rainwater tank or a solar hot water service. Solar hot water was absorbed into Whole of Home. The tank simply disappeared. Chasing it through the documents leads from the NCC to Volume Three, to the Victorian Building Act, to the Plumbing Act — which only specifies the 2,000 litre tank and 50 square metre catchment if you choose to install one. Practice Note EE-05 stated the tanks were gone as part of the transitional arrangements, without ever making clear whether that was permanent. Nothing has brought them back. The practical upshot for assessors: a rainwater tank forms no part of a NatHERS assessment and never really did, though most reports mentioned it as a courtesy.
The single-house method, in practice
Rating only the renovated house still means producing two energy reports. The first models the renovated dwelling as though it were being built new today, to seven stars. The second applies Regulation 233 discretion so that upgrades are not forced onto parts of the existing dwelling outside the renovation scope, and the whole thing is documented as a performance solution to A2G2. The practical trade the team make to justify that discretion is insulating the existing ceiling — easy access in a pitched roof, and worth doing for the occupants regardless — and underfloor where a timber subfloor allows it. Walls are left alone unless linings are already coming off.
Certify the real rating, not the theoretical one
That approach can leave a genuine result of three or four stars. Brian's position is that the theoretical seven-star report belongs in the documentation set as a preliminary, but the certified document should be the real one, with the dispensations applied — so the owner knows what their house actually achieves and is not left believing they own a seven-star home when they do not.
Why the two-house method fell out of favour
Under NCC 2019 the two-house method dominated Victorian renovation work, helped by the ability to assume worst case — no insulation — where the owner genuinely did not know. That assumption produced a large differential between the existing and completed dwelling, which the formula rewarded. The revised practice note requires the existing dwelling to be rated assuming a minimum of R1.5 ceiling insulation, or the existing R-value where it is known. That lifts the existing dwelling's rating, narrows the differential, and makes the completed house much harder to bring up to the required result. A separate figure of R2.5 appears elsewhere in the same practice note, as the level below which upgrading roof or ceiling insulation is listed among the reasonable improvements a building surveyor may expect — the two are easily conflated but do different jobs. Brian's conclusion is that it is no longer a viable method. Andrew's counterpoint is that the assumption is fair: insulation requirements have applied in Victoria since around 1990, earlier programs put R2 into ceilings through the 1980s, and the pink batts scheme added more — while almost no client can tell you what is actually up there.
The upgrade order for an existing dwelling
Ceiling insulation first: easiest access, lowest cost, best return. Windows next, which are more achievable in an existing building than most people assume. Underfloor where a timber subfloor is accessible. Walls last and rarely, because reaching them means removing linings, skirtings, architraves, cornices and sometimes pressed metal ceilings.
The three kilowatt solar provision
EE-04 contains a paragraph requiring a minimum three kilowatt solar photovoltaic system on any Victorian renovation or addition unless there is physically insufficient roof space. None of the three hosts can explain where the figure came from, and some of that requirement can be mitigated by running the documentation as a performance solution through the ABCB Whole of Home calculator. It is flagged in the episode as deserving an episode of its own.
The ACT adopted the code whole, and added a licence
The Australian Capital Territory moved on 15 January 2024 — after New South Wales, before Victoria — with no variations, taking energy efficiency and Livable Housing across all building classes, at seven star equivalence in a single climate zone. The team's view is that it is marginally easier to comply there than in Victoria, most likely because the cooling load is less demanding. The wrinkle is that formal evidence of energy efficiency must be issued by a licensed building assessor holding a licence under the Construction Occupations Licensing Act — a requirement that also covers building, plumbing and electrical work, and which two of the three hosts had not encountered.
New South Wales went first, and it hurt
New South Wales adopted NCC 2022 on 1 October 2023. Contracts had to be signed before that date, BASIX certificates lasted three months, and if a development application was not lodged inside that window the whole certificate had to be redone under the new provisions — with no dispensation, while the planning portal was failing. Before the change, only separate heating and cooling load caps applied, with no total load cap, so an assessor who knew the system could comply at 4.2 to 4.8 stars. The change introduced a total load cap equal to the megajoules representing seven stars. As Brian put it to the HIA at the time, New South Wales was always going to see the biggest jump, precisely because the previous benchmark was so low.
The carve-out that still permits 4.5-star homes
NatHERS climate zones 9, 10 and 11 in New South Wales still have no total load cap — heating and cooling loads only, tightened somewhat but not dramatically. The team report recently certifying a compliant dwelling at 4.5 stars with single glazed windows and very limited insulation. They understand the reasoning, given those zones border Queensland without access to Queensland's outdoor living area concession, but note it means projects well under six stars still pass in parts of the state.
BASIX does some things Whole of Home does not
New South Wales has no H6P2 Whole of Home requirement, because BASIX already covers that territory — and covers water as well, including shower head and tap fitting efficiency, toilets, garden area and rainwater tanks. The team describe BASIX as a prelude to Whole of Home for the rest of the country, and note it retains more depth and rigour in places. A do-it-yourself pathway exists alongside the NatHERS route, with limits on dwelling size, and Passive House has recently been added as a third compliance pathway — a New South Wales first that advocates are pushing to have adopted elsewhere.
Documents referenced
Building and Plumbing Commission VictoriaPublisher of the Victorian practice notes, including EE-04 and EE-05.
National Construction CodeAustralian Building Codes Board — the code itself, and the Housing Provisions referenced throughout.
ABCB Whole of Home calculatorThe alternative to running Whole of Home through NatHERS software.
BASIXThe New South Wales scheme discussed as the alternative to Whole of Home.
Transcript
Lightly edited for readability. Hesitations and repetition have been removed and technical terms corrected; the substance is unchanged. Part one, covering Queensland, the Northern Territory, Western Australia, South Australia and Tasmania, is Episode 3.
0:05Victoria: home of the potato cake. Not a potato scallop, not a potato fritter. Potato cake is the right terminology down here. And hook turns.
0:25Since we are all down in Victoria, I am going to keep saying we. We have seven stars. We brought that in, and seven stars average for apartments with a six star minimum. Our additions and alterations are a little different, which we will come to. We have Whole of Home as per the NCC.
0:56What we lost was rainwater tanks and solar hot water services, which we previously had. We had a choice of six stars with either a rainwater tank or solar hot water. Solar hot water got rolled into Whole of Home, and water tanks are just gone.
1:16So did they go into the plumbing code? That is a real rabbit hole if you want to chase it down. The NCC points you to Volume Three, Volume Three says to look at the Victorian Building Act, and the Building Act does not really say anything. So you go to the Plumbing Act, and it only talks about what happens if you do install rainwater tanks — then you have to have the 2,000 litres and the 50 square metre catchment we had previously. But only if you do tanks. So parts of the old regulations are there, but it points you all over the place with no real consistency. Practice Note EE-05, the transitional arrangements, is the clearest: it says the water tanks are gone as part of those arrangements. It does not make clear that it is permanent rather than transitional, but there is nothing to say it ever came back.
2:36So what should an assessor do if they want to cover off rainwater tanks as part of their service? Nothing — it does not form any part of NatHERS. There is no requirement under an energy rating to mention a rainwater tank, and because it is not part of the elemental provisions either, it holds no relevance for an assessor. It never really did previously, because six stars was the requirement and another part of the NCC said plus a rainwater tank or solar hot water service. It was never part of an energy rating, but we usually coupled them together anyway.
4:03It was really just a question the building surveyor would ask — which one do you want to do? You pick one and then you are bound by it. It was nothing the energy rater had to do, other than field plenty of questions about it, so we ended up putting it in the notes at the bottom of our reports. More of a connection back to elemental Deemed-to-Satisfy, where you would cover all the parts. It did not have a direct correlation to the energy side. It was a water saving feature, not an energy feature — separate, but alongside.
5:09Andrew, tell us about alterations and additions in Victoria. Brian, do you want to deal with EE-04? Before we do — it is EE-04 with a zero, not the letter O. I know that Tony Isaacs and I worked on this, and there was a conscious point in the conversation where we called it EE-O-4 and changed to EE-zero-4.
6:10There are two main methods of compliance in EE-04 when using NatHERS software. You have the two-house energy rating method, which I will cover in a minute, and you have the method of rating the single renovated house — and that is predominantly the one we actually use, because of changes made to the formula for the two-house method.
6:35When you rate only one house you still have to do two energy ratings. Do not get me wrong — there are still two reports. But if you rate the one house, you are rating the renovated house as if it is being constructed new to seven stars today. It might be fifty per cent extended and fifty per cent existing, but you rate it as a seven-star house as if it were being built right now.
7:06Do I have to build it at seven stars? No. That is the second energy report you need to do. You can ask the building surveyor for dispensation under Regulation 233 for partial compliance for the existing part of the house. That absolves you from applying insulation and glazing upgrades to the existing part where it does not form part of the scope of the renovation. It is also my understanding that when you use this method you need to put it together as a performance solution to A2G2, which we will cover in a different episode.
7:56So you do an energy report on the house as if it were being built brand new today, and then a second certified report with all those upgrades applied to the new part but not in the areas outside the renovation. As a justification for the building surveyor to apply Regulation 233 partial compliance, we generally insulate the ceiling of the existing house. If it is a pitched roof it is easy to get into, and it gives them something. From an occupier's point of view I would do it anyway. I would even insulate under the floor if it were a timber subfloor with easy access. Pulling off external and internal wall linings to insulate walls is a very difficult task if it was not part of the scope, so those are negated.
8:52You might end up with a three star or four star energy rating, and that would be the certified document. I would still put the theoretical preliminary report in the documentation set, and then certify the real energy rating — the one with the dispensations applied — so that the owner of the house knows what their true rating is, and there is no confusion about them thinking they have a seven-star house when they do not.
9:26Reverting to the two-house method, which is how most renovation and extension reports in Victoria were done under NCC 2019: there has been some manipulation of the formula. One of the big changes we saw is that it is now mandatory to have R2.5 insulation in the existing ceiling. What that effectively does is bring the energy rating of the existing house up quite high.
Correction
The figure quoted here is not the one that applies to the formula. Practice Note EE-04, in its current form dated 20 December 2023, requires the existing dwelling to be rated assuming a minimum ofR1.5ceiling insulation in all ceilings beneath attic spaces and in flat, skillion and cathedral roofs, or the existing R-value where it is known. R2.5 does appear in the same practice note, but in a different role: it is the level below which upgrading roof or ceiling insulation is listed as a reasonable improvement to existing building fabric when a building surveyor is considering partial compliance. The substance of the point made here is unaffected — assuming insulation in the existing ceiling does lift the existing dwelling's rating and narrow the differential the formula relies on.
So the differential, when you run it through the formula for the final report once the house is complete, is now too close, and it is harder to bring the completed house up to the rating required. It is not just the SRN in that formula changing from six to seven — other requirements change as well. In my opinion it is no longer a viable method.
10:30Then you have your standard elemental Deemed-to-Satisfy, which applies only to the new part of the house. You can upgrade wall insulation, ceiling insulation and window specification using the glazing calculator for the new part, and you do not have to apply that to the existing under Regulation 233. There are things you can do with the glazing calculator where you apply that specification throughout all the windows in the house, which can give you an easier window specification to comply with. That is probably the only trade-off mechanism available with elemental, and it is more a process item than anything.
11:23Andrew, what are your thoughts on assuming a minimum level of insulation in the existing ceiling? I reckon that is fair. There are not too many houses without some level of ceiling insulation. There have been so many programs over the last few decades to get insulation in. Gas and Fuel ran a program back in the eighties to get R2 onto ceilings. Insulation requirements in Victoria came in around 1990, predating the NCC, so certainly everything after that had at least R2 on the ceiling. We have had the pink batts scheme, for good or bad, but it was a scheme that got insulation onto ceilings. And invariably, every time I ask a client whether they know if they have insulation, the answer is that they do not know, they have not looked up there.
12:43That was the good part about the NCC 2019 version of the practice note: you could choose worst case if nobody knew, which made the deviation from old to new quite dramatic and helped with those formulas. Taking worst case and assuming no insulation in the ceiling threw that out the window and made it more difficult to comply using the two-house method — in my opinion, having done a lot of them.
13:25Ever since that calculation came in I always took the attitude that there is usually insulation in there. If the client could tell me there is none, that they had been up in the roof and knew, then I would apply zero. If they did not know, I always assumed R2 — an assumption of R2 having degraded from R2.5 when it was first installed, because of all these historic programs.
13:53Out of all the building elements, ceiling insulation is the one you are most likely to find, and the easiest to do. It is one of the most cost effective and gives you the biggest return. Underfloor is good as mentioned earlier, but more difficult if you are not lifting floorboards. Walls are incredibly difficult. Windows are probably the next easiest after ceiling insulation — improving window performance in an existing building is achievable, whereas doing the walls can be very invasive: removing skirtings, architraves, corners, pressed metal ceilings and a whole lot else.
15:03Funnily enough, you were doing a lot of calculations before and I was not, because having assumed insulation in the ceiling I found it hard. Now that the requirement is there, you are finding it hard for exactly the same reason. I simply predated where we are at the moment.
15:30Our calculations for the two-house formula were always automated. All the volumes, all the areas, straight out of the NatHERS software. That is why we did it that way — it was easy and we were seeing good results consistently, rather than trying to get the house to six stars and then asking for dispensation under Regulation 233. But having adjusted the formula for the new practice note, we found the results pointed to a cheaper construction cost by getting it all to seven stars and then getting dispensation. So the reverse of what we were doing.
16:19Doing the volume calculations purely from NatHERS would have been tricky, because the volume calculation is more complex than just the zone itself. Brian is talking about the data that comes out on the diagnostic report, where you take the areas and multiply by the ceiling height. That is one way of doing it. I did them a little differently — but that was the thing, there was no one way to achieve the outcome. As long as you were consistent on both, you get a comparable result, because they are relative. Even now we still argue about which is the right way to interpret the practice note, and it drives us barmy a lot of the time. A deep dive into that one practice note would be worthwhile — we could spend an entire session on it.
18:36Let us move on to H6P2 in EE-04 for renovations and extensions. There is a paragraph in the practice note that says any renovation or extension in Victoria must have a minimum of a three kilowatt solar photovoltaic system, unless there physically is not enough room on the roof. I do wonder why that was in there. We put the documentation together as a performance solution, run it through the ABCB Whole of Home calculator, and can mitigate some of that three kilowatt requirement. Any thoughts on why the backstop was three kilowatts? No — to be honest I had forgotten it was there.
19:47The majority of the work I do falls into new homes rather than alterations and additions. But if I am honest, there was a period where there was so much uncertainty that it almost felt dangerous to do alterations and additions unless you were fully across it. I would not be surprised if there are people who used to do a lot of that work, going back to the days of PN55, who did not quite make the transition and found taking on alteration and addition work too difficult.
20:36These documents have a history. PN55 was 2010, and it had a few iterations. It got better around 2018, and I would like to think it improved again when it split into EE-03 and EE-04. It got better iteratively every time. There were a lot of issues to begin with, but like a lot of things the devil is in the detail, and in how we read and interpret things. There are interpretations again with Regulation 233 and a less than twenty-five per cent extension: do you need to do Whole of Home or not, should you put solar on or not. It would be good to get a Victorian relevant building surveyor in for that session — or a few of them, and let them argue it out.
22:16Moving on to the Australian Capital Territory. I believe the ACT moved to NCC 2022 on 15 January 2024. It was after New South Wales but before Victoria, and the date was set so you could get over the Christmas break and start into it afterwards.
22:50They adopted NCC 2022 energy efficiency with no variations, and Livable Housing, for all building classes. Equivalent to seven stars, and a single climate zone. In my opinion the ACT is ever so slightly easier to comply with than Victoria. I do not know why — colder climate, more insulation, fairly straightforward. You have not got as much of a cooling load. I am not saying they do not get hot, because they do.
23:54One extra requirement in the ACT: the formal evidence for energy efficiency — a certificate or statement — has to be issued by a licensed building assessor. You need a licence issued under the Construction Occupations Licensing Act. It is effectively a licence that regulates practitioners, and it is required not just for energy efficiency but for building, plumbing, electrical work and a range of other disciplines, making sure you comply with safety and quality standards.
25:20The other difference in the ACT is that they have their own scheme for the sale and lease of an existing home — the precursor to the current transition to existing homes, everything now coming under the same umbrella as Scorecard. Do they need a licence for that too? Yes, I believe so — registered as a class one or class two depending on what you do and how, using FirstRate 4. So does anybody have a copy of FirstRate 4? We both do. On the black market that is worth how much? It is gold.
26:28What is interesting is that there is no training available in FirstRate 4. That would not surprise me — the manual is about eighty pages, if that. If you cannot figure out FirstRate 4 from that you are in trouble. Although a lot of people probably would not have had access to a manual; if you had the software it was included on the CD.
27:02I remember all the scale rulers and drawing on plans, measuring everything up and typing it in. It was a bit like AccuRate Enterprise, really. Getting way off topic, but I did a day of training on the NatHERS software before second generation software — the precursor to AccuRate. In many ways there were similarities: you had to type in all your data, wall lengths, heights, the offset to this window, how far that window was from the corner, the eave. It was before the graphical interface we have now. That was a one-day course, just to show it more than anything. Then the RBTPA course was two days with the software. That was FirstRate 4. Then second generation came in, which became two days of software plus two days of theory — a four-day course, before transitioning to the Certificate IV.
29:16Andrew, you started on FirstRate 3? Three, then 3.5, then four. And I joined with five. I sort of wish I had joined the industry a little earlier and gone on that journey — I think I made up for it becoming accredited in all four tools, but I missed the early ones. You did not miss it. Generation one was a completely different tool to generation two. When we went to FirstRate5 and you had the graphical interface and drew all the zones, it was a case of look what you can do, look at the data that comes out of it. Where generation one was: get your ruler, how long is this wall, six metres, type in six metres. That was your data. You did not do internal, you did not look at room configurations. It was incredibly simple.
30:28It makes you wonder how the Chenath engine interpreted all that data without the graphical interface we use now. Did it even have a Chenath engine, or was it a different engine back then? I am fairly sure it was still Chenath, just a different version.
30:52Right, let us get on to the last one: New South Wales. I do not do any work in New South Wales — I avoid it — so I am not going to say anything here.
31:00From memory, New South Wales was the first to adopt NCC 2022, and I am pretty certain that was 1 October 2023. Because they use BASIX, which is a different system, contracts had to be signed prior to 1 October 2023, and those BASIX certificates only last three months. So if you did not apply for your development application within that three months, you would have to complete a new BASIX certificate.
31:38This is when, with that transition, the New South Wales portal was down all the time, things were going wrong, calculations were not working. There was a lot of trouble in that period and absolutely no dispensation. If your BASIX certificate ran out in three months you would simply have to do an NCC 2022 version of the house. You can imagine how that went down: you were doing a BASIX report trying to comply with the thermal performance protocol, only having to achieve a certain heating load and cooling load, and suddenly you had to achieve seven stars when the energy reports could have been 4.5 or five stars. Suddenly you had to jump up two stars. That is a hard pill to swallow.
32:44The stringency increased in the BASIX portal itself, and you also had a total load cap to comply with that you did not before — the exact same megajoules that represent seven stars. So there was no cap before? No, you had to comply with the individual heating load and the individual cooling load. And if you knew how to do your energy reports succinctly and properly, you could work out exactly the lowest insulation and glazing you could put in to meet that heating and cooling load cap. There was a cap for heating and cooling, not for the total load — and the total load is the one that represents the star value. So you could get away with four and a half stars as long as you met the heating and cooling caps. The transition to NCC 2022 with the total load suddenly jumps all the way to seven stars. That is a big bridge.
34:04What star ratings were you seeing before 2022 when you were meeting the heating and cooling load caps? 4.2. 4.4. And that is why, with the CSIRO portal and that type of data, the numbers are quite low — that is all because of the old BASIX requirements.
34:36Let me make it worse. In NCC 2022, for NatHERS climate zones 9, 10 and 11 in New South Wales, you still do not have a total load cap. It is still heating and cooling load only. Granted it has become a little more stringent, but not very. Very recently I have seen one at 4.5 stars that still complies with NCC 2022 — single glazed windows, very limited insulation, still complies.
35:22I understand why, given you are higher up in the state, bordering on Queensland. Queensland has the one star credit and New South Wales does not, in similar climate zones. A big double storey house would be quite hard to get to seven stars — not impossible, but difficult. So I understand why they have done it, but it shows you can still get projects through in certain climate zones well under seven stars, well under six stars even. And it is reasonably common.
36:00So we moved to seven stars and got the heating and cooling load caps. What about Whole of Home for New South Wales? You do not have that performance requirement H6P2, because you have the other requirements within the BASIX portal to comply with. Some of those items have also changed. These are things like water tanks, the star rating and efficiency of shower heads, tap fittings, toilets. You have to calculate garden area and rainwater tanks with respect to the area of plantings around the property. That has always been there, and it is pretty much a prelude to Whole of Home in the rest of the states. It is quite similar — a very environmentally sustainable design type arrangement, like some of the states have, Victoria included. BASIX just comes in earlier before all of that.
37:23That is if you are using the NatHERS method for compliance with the thermal performance protocol. There is also a do-it-yourself method, more similar to an elemental Deemed-to-Satisfy, where you calculate the orientation of the windows, the height, the width, shading and so on. But what we are finding is that because of the offset facilities available in NatHERS, it is still easier to comply with NatHERS than with the do-it-yourself route. There are also limitations with do-it-yourself, such as the size of the house. And within BASIX you can also do renovations and extensions.
38:07Then there is a third option of Passive House. That is a new requirement for New South Wales only. I do not do Passive House, so I am not fully across it. It is another regulatory compliance pathway accepted in New South Wales, and I believe Passive House advocates are trying to get that pathway adopted in other states and territories. I would have thought that out of all of them, Victoria would be suitable, especially given our climate zone and the fact that Victoria has historically been quite progressive on energy efficiency. So I was a little surprised to see New South Wales move on that before Victoria. They are also moving on established houses before Victoria.
39:22Running through the things the BASIX online tool covers, it actually has a little more detail — more depth, a bit more rigour almost — than Whole of Home has in the NatHERS software. We were talking earlier about what happened to the rainwater tanks: they are not picked up in Whole of Home, but they are still picked up in BASIX. Whereas for Victoria it now only comes in as a planning requirement.
40:01So that rounds out a tour around Australia. I am tired — this was a long trip. That wraps up this episode of The Rating Room. Thanks for joining myself, Matthew and Andrew as we uncovered another corner of the NatHERS world. Your thoughts, questions and insights are incredibly important to us, and this podcast is as much about the broader industry conversation as it is about our personal views. So jump onto the NatHERS Assessor Network Facebook page, share your perspective, and leave a comment below the video. We would love to hear what you think and what topics you would like us to cover next. Until next time, keep rating.