Electrifying big apartment buildings is complex, but huge cost savings from ditching gas justify the pain

It’s not simple to convert a big apartment building to electric, but certainly worth it in the long run, says GHD engineer Luke Barry.

Barry’s own work shows just how complex reconfiguring an existing apartment building is to electric. So why would anyone would do it, once they find out what it takes?

“The main focus for owners corporations is cost,” he told Renew Economy.

“If they’re going to be living in an apartment for 10 years and they’re getting off gas, they’re saving $5,000 in connection fees alone over that time in addition to the electricity connection fee.”

Only apartment buildings not tied into dreaded embedded networks pay individual gas and electricity connection fees, a system where a private company runs a building’s gas or electricity network. 

But factoring in the cost of the gas itself, which requires more energy to do the same thing as efficient electric appliances, and the risk of being left paying ever-higher fees for connecting to the gas network, and it hints at the sums of money at stake for a segment of property owners who, to date, have been almost entirely missing from the electrification conversation. 

Barry, a consultant for global engineering firm GHD, was working on a project funded by the City of Melbourne and the state government, called the Electrifying Apartment Buildings Program.

The goal is to do energy assessments on up to 10 medium and high-rise strata titled apartment buildings across metropolitan Melbourne, between September and March next year, and help apartment communities understand and improve their building’s energy performance, electrify their buildings, and reduce their energy costs.

While part of the battle is in convincing owners corporations to spend money on feasibility studies to start with, as Renew Economy has reported in the past, and then jumping the regulatory and knowledge hurdles that come after, knowing what can be done to a building is a major part too. 

Barry says so far they’ve finished assessments on two buildings, one with 90 apartments and one with 500.

The results illustrate where the technical obstacles that owners corporations in Victoria are up against.

“The findings from the first two is that the technical side of the upgrade is not too much of a challenge,” he says.

“It will be for some buildings… but the ones that we worked on with domestic water and gas cooktops, it was quite simple to provide them with a design for an electric heat pump in place of a gas system.”

Technically, it’s a case of swapping out hot water boilers when they reach old age and gas cooktops, and possibly adding electric vehicle (EV) chargers.

The challenges come from power supply bottlenecks, and the upfront cost of conversions. Barry says replacing a gas boiler needs just one company to do the work. Doing the same with an electric version requires two companies to remove and supply the new equipment, gas plumbers and electricians.

While swapping out gas for electric won’t mean a like-for-like energy swap, it does mean making sure there is spare capacity in the substation serving the building.

Barry says there is plenty of headroom in the substations serving the two buildings he’s finished looking at, but in other areas that may not be the case and it would limit what a building can do.

The other three expensive issues are in the switchboards: the building’s main one that farms out power to different areas, the one that handles common equipment such as hot water heaters, and those in individual apartments. 

As owners of houses are quickly coming to understand, Australia’s history of delivering single phase electricity means there often isn’t enough capacity to handle the electricity needs of modern cooking – the induction cooktop. 

“The addition of induction cooking across the apartments [means] it’s likely they will need a switchboard upgrade,” Barry says. 

How simple are the wiring and switchboard upgrades? “Not very.”

But owners corporations, particularly in places like the Melbourne CBD, need to have an eye on the future, Barry says, given that council has a goal of being gas free by 2040. 

Anyone still attached to the network will be paying an ever larger fee for the privilege as others quit. 

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