The benefits of home energy upgrades

A home should be somewhere you’re safe, happy, and healthy. 

But most homes in Australia are not built to withstand cold winters and our hot summers, which are getting hotter for longer due to climate change.  

People on low incomes and renters are too often living in homes that reach over 45 degrees indoors in the summer, have been hospitalised due to heat stress, forced to go without food or medical care to pay their energy bills to stay cool. 

But they lack the resources and control to improve the energy performance of their homes to reduce costs and make them climate safe.   

Governments need to step in and directly invest in home energy upgrades of low-income housing to ensure homes are warmer in winter, cooler in the summer and cheaper to run so people in those households are protected. 

ACOSS commissioned research, displayed in these online maps, to demonstrate the possible benefits of prioritising home energy upgrades for low-income housing. 

The maps reveal how much households could save a year (thousands of dollars), from quick-fix home energy upgrades, which would reverse the trend of rising energy costs and reduce cost-of living pressures.

The maps also show the accumulative bills savings to the electorate if all low-income housing in that electorate received quick-fix home energy upgrades.

The maps consider the emissions reductions that could be achieved to help Australia reach its emission reduction targets, so we can minimise the worst impacts of climate change.   

Finally, the maps include the number of jobs (represented as a person working full time for a year) that could be created from the manufacturing, supply and installation of home energy upgrades, with extra jobs created due to the additional spending low-income households make back into the economy from bills savings (for the thermal efficiency and electrification upgrades). Many of these are local jobs.

Other benefits would be achieved like improving health and well-being, reducing poverty and inequality, and ensuring no-one is left behind in the energy transition, but it was beyond this project to measure these benefits. 

The ACOSS research: 

• Focuses on the benefits created if the government were to invest in upgrades for the lowest household income quintile (bottom 20%, less than $800 week in 2021). The research also models the benefits if the government was only to upgrade social housing units
• Considers ‘quick-fix’ home energy upgrades (energy efficiency and electrification) and rooftop solar (based on research by ClimateWorks Renovation Pathway) 
• Displays the results by federal electorate 

The type of upgrades included in the quick-fix scenario include: 

• Energy efficiency – Ceiling insulation R3.0, draught reduction, curtains, external window shades, efficient heating and cooling. Efficiency is critical to improving the temperature within the home and reduce energy use and cost to power the home. 
• Electrification – efficient electric hot water heating and induction cooking. Efficient electric appliance are cheaper to run, eliminate the need to use costly and high emissions gas, and eliminate negative health impacts of gas.  
• Rooftop Solar – maximum solar needed to cover electricity use of home

The cost of these upgrades per household would be:

Energy efficiency and electrification 

Solar 

You can access more information about the modelling approach and assumptions here. 

ACOSS is calling for the federal government to accelerate home energy upgrades for low-income housing by establishing a Special Purpose Funding Vehicle, with an initial Federal Government injection of $2 billion in the first year, scaling up each year with contributions from other sources- to invest and scale up home energy upgrades, tailored across low-income housing tenure types. Use the funds to do the following:

• Top up the existing $300 million social housing energy upgrade funds targeting only 15% of social housing, so that all social housing dwellings have home energy upgrades by 2030. Prioritise funding to upgrade First Nations Housing.

• Provide assistance for low-income owner occupiers through a combination of subsidies and zero-interest loans to undertake home energy upgrades by 2031.

• By 2035 upgrade private rental properties through a combination of mandatory energy performance rental standards and conditional incentives via combination of subsidies, concessional loans and cap on rental increases.

• The analysis for the project was undertaken by Springmount Advisory.
• Broader analysis was undertaken in collaboration with Deloitte Access Economics
• National housing stock model data and state and territory findings come from Climateworks Centre’s Renovation Pathway program.
• This project was made possible thanks to funding from Boundless Earth and the Paul Ramsay Foundation. The views expressed on this page do not necessarily reflect the views of Boundless Earth and Paul Ramsay Foundation.