The Change
Building and Construction Minister Chris Penk has confirmed that the Schedule Method — the most prescriptive of the three compliance pathways for insulation under H1 of the New Zealand Building Code — will be removed by the end of 2025, followed by a 12-month transition period. The Schedule Method will be replaced by a ‘whole of house’ approach that uses online tools to calculate a building’s total heat loss, allowing designers to make trade-offs between building elements — adjusting window size, insulation thickness, and thermal mass in combination — rather than being locked into fixed minimum specifications for each element independently.
Penk’s rationale: “The most prescriptive compliance pathway doesn’t allow for design trade-offs that can affect a home’s energy efficiency, like adjusting window size. This has led to designers and homeowners having to over-insulate in certain areas to achieve Building Code compliance, offering little extra energy efficiency benefit at a significant cost.” He estimates the change could reduce the cost of an average new build by up to $15,000.
The Industry Divide
The response from the construction and building science sectors is divided. Builders who have struggled with the rigid requirements of the Schedule Method welcome the flexibility — particularly the ability to make design trade-offs that currently require expensive workarounds. Insulation manufacturers, green building advocates, and public health researchers are concerned that the change represents a rollback of the 2022 H1 improvements that brought New Zealand’s insulation standards closer to international norms and were estimated to reduce heating costs by 40 percent per home.
MBIE’s own experts, in documents obtained under the Official Information Act, reportedly warned Penk that the pre-2022 standards were significantly behind international norms. Penk sided with developers who cited build cost increases of $40,000-$50,000 and reports of overheating in highly insulated buildings as justification for the change.
The Public Health Perspective
Dr Lucy Telfar Barnard of the Public Health Communication Centre stated: “There’s 20 years of strong evidence in Aotearoa showing insulation benefits far outweigh the cost. Rolling back now would be a serious misstep.” Richard Arkinstall of the Insulation Association of New Zealand noted that insulation comprises just 1.2-1.4 percent of a home’s build cost but delivers a $4 return for every $1 spent through health, productivity, and energy savings.
The Far North Climate Zone Proposal
Separately, Penk has asked officials to consider designating the Far North as a distinct climate zone with lower insulation requirements, reflecting the region’s warmer temperatures and the particularly acute housing affordability challenges at $5,000 per square metre build costs. MBIE will consult before any changes to climate zone designations are finalised. For builders working across multiple regions, the potential for differentiated compliance requirements adds a layer of project-specific specification management to what has already been a period of significant regulatory change in insulation requirements.
