Australia risks locking in millions of tonnes of carbon as housing boom accelerates

Before a single appliance is turned on, the average all-electric Australian home has already emitted over seven times the amount of carbon it will produce during its entire operational lifetime, according to a new report.

The study, Our Homes Weigh a Tonne – of Carbon Per Square Metre, by the Green Building Council of Australia (GBCA), comes as the Albanese Government ramps up efforts to build 1.2 million new homes over the next five years.

It reveals that constructing and furnishing a typical detached home results in 185 tonnes of upfront carbon emissions, the equivalent of driving a petrol car around Australia 185 times. 

In contrast, the same home will emit just 24 tonnes over 60 years when powered by Australia's increasingly decarbonised electricity grid. If the home runs entirely on solar, its operational emissions drop to near zero.

“These findings land at a critical moment,” says GBCA CEO Davina Rooney. “As we scale up new housing, we must make sure the homes we build today don’t bake in emissions that undermine our climate goals.”

Australia’s built environment currently accounts for 31% of the country’s total emissions, with around 7% coming from upfront carbon, the emissions embedded in materials, manufacturing, transport and construction.

As housing supply becomes a national priority, these emissions are set to grow rapidly unless tackled from the outset.

Australia has averaged around 111,500 new homes a year since 2010. Over the next 25 years, that amounts to about 2.79 million homes. If action isn't taken to reduce upfront carbon, relying solely on the grid’s decarbonisation, building these homes would emit an estimated 426 million tonnes of CO₂ equivalent. That’s nearly 11% of Australia’s remaining carbon budget to 2050.

The Clean Energy Finance Corporation (CEFC) says the report underscores the need to embed sustainability earlier in the construction process to deliver long-term emissions reductions and economic benefits.

“Reducing embodied carbon in new housing is one of the next frontiers for decarbonisation,” says CEFC Head of Property, Michael Di Russo. 

“With the right investment in innovation, we can scale up low-carbon construction and create new opportunities for Australian manufacturers and clean technology providers.”

The GBCA’s recommendations focus on scalable, low-cost policy tools ready to be deployed. These include:

•    Introducing upfront carbon reporting for all homes through NatHERS – expanding the National Home Energy Rating Scheme to account for construction and material emissions, not just energy use.
•    Setting clear national targets to cut embodied carbon – 20% by 2031.
•    Securing long-term funding for NABERS to maintain emissions data infrastructure.
•    Embedding low-carbon standards in government-funded housing.
•    Supporting local innovation in circular and low-carbon building materials.
•    Using planning rules to encourage smaller, simpler homes and smarter urban density.

“This is about smarter policy, better data, and leveraging existing tools to cut waste, improve housing efficiency, and support local innovation,” Rooney says.

The report’s release comes amid growing federal backing for modern construction methods. The Australian Government has pledged $54 million to boost modular and prefabricated housing, and $4.7 million to establish a national certification scheme for offsite construction.

These approaches can shorten build times and drastically reduce material use and waste, aligning closely with the GBCA’s call for simplified design and lower-carbon materials.

“Modular construction is a clear opportunity to deliver more homes, faster – and with a much lighter carbon footprint,” Rooney says.

“When smart design, new building technology and low-carbon materials come together, we get homes that are more sustainable, more affordable, and quicker to build.”

To reinforce this shift, the GBCA is introducing upfront carbon requirements into its own frameworks. Green Star Communities v2 includes precinct-level carbon budgets, while Green Star Homes v1.1, set for release in 2026, will require all rated homes to reduce upfront carbon, either per square metre or within a total carbon limit.

“This is a clear market signal. We’re working with industry leaders who are ready to act and we’re already seeing encouraging signs from the Government. We look forward to working together to deliver homes that are built for tomorrow and play a meaningful role in meeting Australia’s climate targets,” Rooney says.

GBCA has thanked its project funding partners, the Clean Energy Finance Corporation, Development WA and Landcom, for supporting the report, as well as technical partner TSA Riley for their contribution to the analysis.
The full report, Our Homes Weigh a Tonne, is available here. 

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