Australia Net-Zero Energy Buildings Market Overview, 2031

Key Insights

• According to the research report, "Australia Net-Zero Energy Buildings Market Outlook, 2031," published by Bonafide Research, the Australia Net-Zero Energy Buildings Market is anticipated to grow at more than 19.11% CAGR from 2026 to 2031.
• Australia has a large and diverse residential and non-residential building stock, creating sustained demand for energy-efficiency, electrification and renewable-energy solutions across both new construction and existing buildings. The national Trajectory for Low Energy Buildings provides a coordinated pathway toward a net-zero emissions building sector by 2050. The policy direction increasingly focuses on improving energy efficiency, switching buildings toward electricity, managing demand on the grid, reducing embodied carbon and improving climate resilience.
• Australia’s building decarbonisation pathway combines stronger standards for new buildings with measures to improve the performance of existing homes and commercial properties. NCC 2022 established a minimum 7-star NatHERS thermal performance requirement for new homes together with a Whole-of-Home energy-use budget. NCC 2025 subsequently strengthened commercial energy-efficiency provisions, including measures covering building fabric, services, lighting controls, solar PV and future electrification. These requirements are supported by programs such as the Household Energy Upgrades Fund and the Social Housing Energy Performance Initiative.
• Building regulation is moving beyond operational energy efficiency toward broader net-zero performance. The 2025 update to the Trajectory for Low Energy Buildings explicitly includes fuel switching and electrification, energy-demand flexibility, embodied carbon, resilience, green finance and refrigerant emissions. NABERS has also expanded into embodied-carbon assessment, giving commercial developers and owners a recognised mechanism for measuring upfront embodied emissions.
• Australia’s climate diversity and high uptake of rooftop solar make efficient heating, cooling, hot water and renewable generation important components of building decarbonisation. Heat pumps, efficient HVAC, insulation, high-performance glazing, rooftop solar PV, batteries and building energy-management systems can reduce energy consumption and support electrification. By the end of 2025, Australia had more than 4.3 million rooftop solar systems and approximately 28.3 GW of installed rooftop solar capacity, demonstrating the scale of distributed renewable adoption.

Market Outlook

• The Australia Net-Zero Energy Buildings Market remains strongly influenced by the national net-zero-by-2050 objective, the Trajectory for Low Energy Buildings, successive National Construction Code updates and state and territory building policies. The 2025 Trajectory provides the current national policy direction, while the NCC establishes minimum technical requirements for new buildings. The practical timing of NCC 2025 adoption varies across jurisdictions, so market implementation is not completely uniform nationwide.
• New construction remains a key opportunity because energy performance can be incorporated into building design before construction begins. Residential projects are subject to the high-performance framework established through NCC 2022, including 7-star NatHERS thermal performance and Whole-of-Home energy requirements, subject to jurisdictional implementation. NCC 2025 strengthens commercial energy-efficiency requirements and introduces measures supporting solar PV and future electrification. These changes increase demand for efficient envelopes, HVAC systems, heat pumps, controls, solar generation and energy-management technologies.
• Renovation & Retrofitting is expected to become increasingly important as governments and building owners address the performance of existing properties. The Household Energy Upgrades Fund provides discounted finance for more than 110,000 households, while the Social Housing Energy Performance Initiative is expected to reach more than 100,000 social housing properties. Eligible upgrades include insulation, shading, efficient electric appliances, heat-pump hot water, solar PV and batteries. These programmes create a direct market for retrofit equipment, contractors and energy-performance services.
• Equipment demand is increasingly concentrated around electrification, energy efficiency and distributed renewable generation. Heat pumps for space conditioning and hot water, high-efficiency HVAC, insulation, glazing, rooftop solar PV, batteries and building energy-management systems are well positioned as building owners seek lower operating costs and reduced emissions. The rapid expansion of household batteries is also creating opportunities for technologies that can coordinate building loads with distributed energy resources.

Policies & Regulatory Landscape

• Australia’s building energy-efficiency framework is anchored by the National Construction Code, administered nationally by the Australian Building Codes Board, together with state and territory building legislation and the national Trajectory for Low Energy Buildings. The updated Trajectory was agreed in August 2025 and provides a pathway toward a net-zero emissions building sector by 2050. It places greater emphasis on energy efficiency, electrification, demand flexibility, embodied carbon, resilience, green finance and refrigerant emissions.
• NCC 2022 introduced a minimum 7-star NatHERS thermal performance requirement for new homes, together with a Whole-of-Home energy-use budget. Whole-of-Home assessment considers energy associated with heating, cooling, hot water, lighting, cooking and appliances, while accounting for on-site solar generation. Implementation and transitional arrangements are determined by individual states and territories.
• NCC 2025 represents the next major step for commercial building energy efficiency. The final code was published in May 2026, with jurisdictions able to determine their own adoption and transition arrangements. The updated provisions strengthen commercial energy-performance requirements and include measures covering building fabric, lighting controls, solar PV and infrastructure that supports future electrification. Residential energy-efficiency changes proposed during the NCC 2025 process were not introduced, maintaining the high-performance residential framework established under NCC 2022.
• Complementary policy instruments include NatHERS for residential buildings, NABERS for commercial building performance, the Commercial Building Disclosure program, state-based schemes such as BASIX in New South Wales, and voluntary sustainability-rating systems such as Green Star. These mechanisms help create market differentiation and provide owners with performance information beyond minimum building-code compliance.
• Embodied carbon is becoming a more important part of the regulatory and market landscape. NCC 2025 includes a voluntary pathway for commercial buildings using NABERS Embodied Carbon, while governments are continuing work on future minimum embodied-carbon requirements. NABERS awarded Australia's first certified Embodied Carbon rating in December 2025, establishing a practical benchmark for measuring upfront embodied carbon in eligible projects.

Net-Zero Energy Buildings Procurement & Industry Impact

• Net-zero and high-performance building procurement in Australia typically involves government agencies, developers, architects, engineers, builders, specialist contractors, equipment manufacturers and energy-service providers. Project specifications increasingly reference NCC requirements, NatHERS, NABERS, Green Star and organisational net-zero targets. This places greater emphasis on performance modelling, documentation, commissioning and coordination between building systems.
• Equipment suppliers are expected to provide technologies suited to Australia's different climate zones and building types. Heat pumps, efficient HVAC, insulation, high-performance glazing, rooftop solar PV, batteries and building energy-management systems must deliver reliable performance while integrating with existing electrical and mechanical infrastructure. Suppliers that can demonstrate energy savings, lifecycle benefits and compatibility with Australian standards are better positioned in high-performance projects.
• Solutions & Services providers have an increasingly important role because high-performance buildings require more than individual equipment upgrades. Energy modelling, NatHERS assessments, NABERS ratings, commissioning, measurement and verification, retrofit planning, embodied-carbon assessment and digital monitoring help owners understand whole-building performance. Integrated service providers can coordinate envelope, HVAC, controls, renewable generation and storage to improve overall outcomes.
• Procurement is also placing greater emphasis on lifecycle performance. Operational energy remains a major consideration, but embodied carbon, refrigerant emissions, material selection and future adaptability are becoming increasingly relevant. Environmental Product Declarations and other product-level environmental information can help project teams compare materials and demonstrate progress toward sustainability objectives.

Industry News

• In August 2025, the Energy and Climate Change Ministerial Council updated the Trajectory for Low Energy Buildings. The new trajectory replaced the 2019 version and broadened the national focus to include energy efficiency, electrification, demand flexibility, embodied carbon, resilience, green finance and refrigerant emissions. It continues to support the objective of moving Australia's building sector toward net-zero emissions by 2050.
• In December 2025, the Energy and Climate Change Ministerial Council approved the Trajectory for Low Energy Buildings Implementation Plan 2026–2027. The plan establishes coordinated work across residential and commercial buildings, including further development of NatHERS, home energy-rating disclosure, NABERS, commercial building data and policies supporting low-energy and net-zero-ready buildings.
• In May 2026, NCC 2025 was published as Australia's latest National Construction Code edition. The updated code strengthens commercial energy-efficiency provisions and includes measures covering building fabric, lighting controls, on-site solar PV and future electrification. State and territory adoption and transition arrangements determine when the provisions become applicable in each jurisdiction.
• In December 2025, NABERS awarded Australia's first certified Embodied Carbon rating to a facility at Kemps Creek in New South Wales. The rating established a national benchmark for measuring upfront embodied carbon and strengthened the role of environmental data and Environmental Product Declarations in construction procurement.

Segment Analysis

Net-Zero Energy Buildings By Project Type
• New Construction provides a major opportunity to integrate high-performance building systems before occupancy. Residential projects continue to operate under the high-performance framework introduced through NCC 2022, including 7-star NatHERS thermal performance and Whole-of-Home energy requirements, subject to state and territory implementation. Commercial projects are affected by the strengthened energy-efficiency provisions in NCC 2025, creating demand for efficient envelopes, HVAC, heat pumps, lighting controls, solar PV and energy-management systems.
• Renovation & Retrofitting remains important because much of Australia's future building performance will depend on improving existing properties. Residential finance programmes, social-housing upgrades and commercial energy-performance initiatives are supporting demand for insulation, shading, efficient appliances, heat-pump hot water, HVAC upgrades, solar PV, batteries and building controls. Retrofit activity is particularly attractive where upgrades can reduce energy bills while improving thermal comfort.
Net-Zero Energy Buildings By Building Type
• Residential buildings represent a major opportunity for energy-efficiency, electrification and renewable-energy technologies. Detached houses, townhouses and apartments can benefit from better insulation and glazing, efficient heating and cooling, heat-pump hot water, rooftop solar, batteries and smart energy-management systems. The 7-star NatHERS framework for new homes and the expansion of home energy-upgrade finance are supporting both new-build and retrofit opportunities.
• Non-Residential buildings offer opportunities across offices, retail, healthcare, education, hospitality, industrial facilities, warehouses and government buildings. These properties often have significant HVAC, lighting and equipment loads, creating opportunities for efficient mechanical systems, heat recovery, controls, solar PV, batteries and energy-management platforms. NABERS, Commercial Building Disclosure and strengthened NCC requirements provide additional incentives for owners to improve measurable performance.
Net-Zero Energy Buildings By Component
• Equipment demand is increasingly focused on technologies that improve energy efficiency while supporting electrification and distributed renewable generation. Heat pumps, efficient HVAC, hot-water systems, insulation, high-performance glazing, rooftop solar PV, batteries and building energy-management systems are relevant across both new construction and retrofit projects. Climate-zone suitability, installation requirements, lifecycle cost and interoperability are important technology-selection criteria.
• Solutions & Services are becoming increasingly important as Australian projects move toward integrated energy and carbon performance. Energy modelling, NatHERS assessments, NABERS ratings, commissioning, measurement and verification, retrofit planning, embodied-carbon assessment, environmental-product-data management and digital energy-management services help owners measure and improve building performance. Projects targeting deep energy savings or net-zero readiness particularly benefit from integrated technical services that coordinate the building envelope, mechanical systems, controls, renewable generation and storage.

Considered in this report
• Historic Year: 2020
• Base year: 2025
• Estimated year: 2026
• Forecast year: 2031



Aspects covered in this report
• Net-Zero Energy Buildings with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Project Type
• New Construction
• Renovation & Retrofitting

By Building Type
• Residential
• Non-residential



By Component
• Equipment
• Solutions & Services