CFMEU pushes Labor into big household electricity retrofit

Labor has put the green retrofitting of homes, apartments and office buildings on its policy agenda under pressure from the powerful CFMEU.

CFEMU national secretary Zach Smith. Picture: NCA NewsWire / Gary Ramage

Labor has put the green retrofitting of homes, apartments and office buildings on its policy agenda under pressure from the powerful CFMEU, in what the union describes as a “major priority” for its members that must include a shift from gas to electric appliances and upgrades to building materials.

CFMEU national secretary Zach Smith has warned Anthony Albanese will not meet his 2030 emissions reduction target unless Labor unveils ambitious plans to retrofit buildings, arguing government investment was needed as the private sector was unwilling to foot the bill.

Changes made to the draft ALP national platform – which is compiled by a group of Labor MPs, party members and unionists and binds the party to policies in the next term of parliament – reveal a new clause backing upgrading homes to be more energy efficient.

The clause also backs the retrofitting being done by “skilled workers” and using Australian-made materials.

“The majority of Australia’s current housing and commercial building stock is not built to modern energy performance standards,” the latest draft of the platform says.

“Labor believes retrofits to existing homes and buildings should be performed by skilled workers in secure jobs with safe working conditions, and support Australian manufacturing to produce the materials needed for this work in Australia.”

The amendment follows Victoria last week announcing gas connections on new homes would be banned from next year, while the NSW government on Monday said it would not be following a similar policy.

Mr Smith said the change to the ALP platform had been clinched by the union after a decade of seeing the country fall behind on retrofitting.

“We need the federal government to be ambitious on retrofitting. That's exactly why securing this change to the ALP draft policy platform was a major priority for the CFMEU,” he said.

“Upgrades to the building fabrics, operations and electrification is necessary to achieve net zero … The private sector simply hasn't made the necessary investment so it’s critical government plays its role here.”

Mr Smith – who would not rule out the need for government subsidies for the nation to make headway on retrofitting – said there would also be significant economic benefits to the policy.

“Research has shown buildings with five-star sustainability ratings have a nine per cent value premium. Buildings a three-star rating or worse suffered a 10 per cent value discount in Sydney and 13 per cent in Canberra,” he said.

“Our union wants to tackle climate change with measures that turbocharge job creation and investment in the construction industry.

“If we continue to be a laggard on retrofitting, you can be 100 per cent sure our emissions targets won‘t be met.”

Mr Smith warned there “Australia‘s specialised retrofitting workforce is non-existent”.

“There’s a yawning skills gap that needs urgent attention,” he said.

“With a dire workforce shortage, continuing to delay action is not an option if we want to do the right thing by the climate and our economy.

Labor put aside $1.3bn in May’s budget under a “Household Energy Upgrades Fund”, which would offer concessional loans to more than 100,000 low income households to reduce reliance on gas in the home.

A spokeswoman for Energy Minister Chris Bowen said: “the Albanese Government support for energy upgrades and energy efficiency, including retrofitting existing homes, is focused on giving Australians choice”.

“We are reducing the biggest barrier to household electrification – the upfront cost,” she said.

“The recent budget delivers significant investments in energy efficiency to ease cost-of-living pressures for Australian families and reduce emissions.”

Master Builders Australia has warned that policies moving housing stock towards being more energy efficient would invariably increase prices, and that government subsidies would be needed to offset such costs.

The Electrical Trade Union – another powerful union on the Left – supported the CFMEU amendment and added its own changes to energy policies in the platform, with the insertion of a clause that stated “Labor will maximise the economic opportunities from the climate and energy transition” and “the decarbonisation of the Australian economy is a singular opportunity to embrace new technologies, and deliver improved social and economic outcomes”.

Labor also dumped any reference to coal in the platform, which was met by some senior party sources with frustration given the assurances given to constituents of coal communities ahead of the last election.

Master Plumbers Association of NSW chief executive Nathaniel Smith warned retrofitting could pass significant costs onto the consumer.

“It would be extremely expensive,” Mr Smith, a former MP in the Perrottet government, said.

“There would be considerable constraints on supply chains … and some buildings are not designed to be electrified.

“The government has to put the consumer first.”

Labor’s move to electrify some homes with the $1.3bn investment in the May budget was met with alarm by plumber’s groups across the country, who warned companies that specialised in gas fittings would be forced to shut.

Grattan Institute energy program director Tony Wood said Victoria’s gas ban for new builds was a “sensible step in the right direction” and that it was clear “we’re going to have to get off gas” in order to address climate change.

He said that landlords should be given “incentives” for putting in place electric appliances instead of gas, before the government moved to introduce regulatory obligations.

“There’s a role for governments to provide some tools … what we recommend is to provide some sort of tax write off to the landlord, not for the long term … because what we’ll find is that the cost of these appliances will come down as we start moving and then you won’t need to provide a subsidy,” he said.

Labor’s platform will be debated at national conference in August, where delegates on the Left will for the first time in decades outnumber those on the Right.

However, senior Labor sources said the Left would not hold an absolute majority, but rather make up for just under 50 per cent of delegates, while the Right is understood to hold up to 45 per cent and the non-aligned delegates holding the rest.

Along with securing an amendment on retrofitting, Mr Smith confirmed last week the CFMEU would move a motion at conference pushing Labor to adopt a super profits tax that could raise the $511 billion needed to fill the nation’s housing shortage.