Optimizing Net-Zero Retrofit Strategy: City of Melbourne Building Stock Case Study

Thesis Abstract

Urban building stock in Melbourne faces mounting energy and emissions targets amid rising retrofit costs and fragmented governance, necessitating a coherent, scalable net-zero retrofit strategy that integrates technical feasibility with financial viability and policy alignment. This study aims to optimize net-zero retrofit pathways for the City of Melbourne by identifying cost-effective, energy-efficient, and climate-resilient intervention packages across diverse building typologies and ownership models. Specific objectives are to (1) quantify the energy savings and life-cycle costs of representative retrofit packages; (2) evaluate governance and funding mechanisms that enable scalable implementation; (3) develop a decision-support framework that harmonizes building physics, financial instruments, and regulatory requirements; (4) assess stakeholder acceptance and behavioral barriers to retrofit uptake; and (5) formulate policy recommendations for accelerated deployment aligned with Melbourne’s net-zero target. A mixed-methods research design combines quantitative energy and cost modeling with qualitative stakeholder insights to produce a robust, implementable framework. The population comprises commercial, multi-unit residential, and institutional buildings within the City of Melbourne (n ? 2,500), with a stratified sample of 300 buildings selected to capture typology, age, and ownership diversity. Data collection instruments include energy audit datasets, building floor area, vintage, and envelope quality; retrofit package catalogs; financial data from utility programs and lenders; and semi-structured interviews with building owners, facility managers, insurers, and policy makers (n ? 40). Temperature and weather-normalized energy consumption data (2018–2023) will be used to calibrate a calibrated building energy model, while life-cycle cost analysis will employ visibility-adjusted discount rates and sensitivity analyses. Methodologically, the study employs a three-pronged analytical approach. First, a dynamic energy performance simulation using BEopt/HEED and EnergyPlus to generate baseline and post-retrofit energy consumption and peak demand profiles for each typology, coupled with a probabilistic cost assessment to estimate net present value (NPV) and internal rate of return (IRR) across scenarios. Second, a multi-criteria decision analysis (MCDA) framework integrating techno-economic performance, capital expenditure, operating costs, payback periods, and resilience indicators to rank retrofit packages. Third, thematic analysis of interview transcripts (NVivo) to identify governance, risk, and stakeholder acceptance factors, triangulated with policy document analysis and data from Melbourne’s sustainability programs. A systems-dynamics model will be developed to explore feedback loops between retrofit uptake, energy prices, and regulatory incentives. Expected findings indicate that well-targeted envelope upgrades complemented by high-efficiency equipment and demand-side management can reduce site energy use intensity by 40–60% for commercial buildings and 25–45% for residential blocks, with NPV-positive outcomes under diversified financial structures such as tax increment financing, low-interest green loans, and performance-based grants. The MCDA is anticipated to reveal that envelope performance and retrofit sequencing dominate decision criteria, while governance flexibility, program simplicity, and lender confidence critically influence uptake. Stakeholder analysis is likely to highlight social equity considerations and the importance of transparent, long-term policy signals to reduce perceived risk. The study contributes to knowledge by offering a context-specific, transferable decision-support framework that integrates physics-based retrofit simulations with financing and governance architectures to achieve net-zero goals in a metropolitan setting. It advances theory by coupling energy transition models with institutional theory on governance and financial risk, and empirically tests the efficacy of Melbourne-specific policy instruments. Practical implications include a prioritized retrofit catalogue for Melbourne, a scalable financing blueprint, and policy recommendations to streamline approvals, standardize performance contracts, and incentivize cumulative emissions reductions. The conclusion emphasizes an integrated, staged retrofit pathway aligned with budgetary realities and regulatory horizons, recommending targeted envelope interventions as entry points, expanded use of performance-based funding, and ongoing monitoring to adapt strategies to evolving energy prices and building stock characteristics.