Blog | 4th May, 2014

How the Victorian Government can save $2.5 billion, create 6,700 jobs and reduce your heating bill

After a long, hot and dry summer, the autumn rains have finally arrived and winter is coming.

Whether the rain on the roof and chilly mornings fills you with dread or conjures up images of cosy comfort probably depends on the efficiency of your home.

For thousands of southern Australians winter is a time of rattling windows, freezing bathrooms and soaring energy bills. And for many low-income households, it’s also a time of hard choices — between keeping the house comfortable or keeping food on the table.

But it doesn’t have to be like this. At the 2010 election, the Victorian State Government committed to lifting the energy efficiency of Victorian homes from an average of less than two to at least five stars. This commitment was a response to a strong cross-sector push by environment, social justice and consumer groups for a green makeover of our homes. Sadly over the past three years the Napthine Government has so far failed to progress this very clear election promise.

This failure has resulted in tens of thousands of households suffering more in last January’s heatwaves than would have been the case with even modest progress. And these same households are now facing the prospect of another cold and costly winter.

Nearly half of the energy we use at home goes on heating and cooling. And yet a big chunk of that expensive energy is simply blowing out our leaky windows.

Delivering on their five-star promise with funding in this week’s state budget would make our homes more comfortable to live in and cheaper to run, and help cut a significant source of Victoria’s greenhouse emissions. Our research shows it could create up to 6,700 jobs in trades and manufacturing, more than 40 per cent of which would be semi-skilled, providing opportunities for disadvantaged and under-utilised job-seekers. And it could relieve pressure on the energy concessions budget (pdf) — the assistance government provides to households struggling to pay their bills.

So in an era of tight state and household budgets, rising unemployment and the imperative to achieve cost-effective emission reductions, this is a policy that ticks all the boxes — economic, social and environmental.

While every house is different, most older homes would see significant improvements from installing basic measures such as draught-sealing, insulation, window shading and curtains and water-efficient fittings. But many Victorians, particularly those most vulnerable to bill stress, simply can’t afford the upfront retrofit cost, regardless of how attractive the savings might be down the track. And renters face a situation where landlords have little incentive to invest in improvements that deliver savings to the tenants.

Heatwaves hit the most disadvantaged Australians the hardest. And with hot-spells expected to increase with climate change, there are calls to act early to save lives.

This is why despite the growing popularity of energy efficiency and renewable energy amongst Victorians over the last decade, there is still an important role for government in ensuring the benefits of efficiency are spread widely and fairly, and that those most in need aren’t missing out.

There are many clear examples here and overseas that highlight the critical role of government in brokering finance and setting the policies and programs that help leverage private investment.

Positive Charge is an initiative of the Moreland Energy Foundation and local government that is rolling out home retrofits across five metropolitan municipalities. The City of Port Phillip’s Climate Challenge 1000 program has retrofitted 1,000 households, many of them concession card-holders in partnership with local community organisations.

But positive as these initiatives are, there is a limit to what can be achieved in a reasonable timeframe at a local level. There is an urgent need for the state government to create and implement policies that will weave these positive but piecemeal initiatives into a comprehensive program that benefits all Victorians.

And this journey starts with a clear commitment in this week’s Victorian State budget.

A comprehensive retrofit program would upgrade 140,000 homes a year over the next decade. It would be funded through a combination of government investment in low-income households, and a mix of policy measures and expanded incentives to leverage private investment in the rest of our housing stock.

It’s practical, cost-effective and will save the government $2.5 billion (pdf) over 20 years from the energy concessions budget that assists low income households with their bills.

Retrofitting our homes is a crucial investment in Victoria’s future. It is living infrastructure that improves the quality of both housing stock and people’s lives, delivers long term affordability in energy and water bills, locks in low-cost emissions reductions, alleviates pressure on water supplies and improves our communities resilience to the health impacts of extreme cold and heatwaves.

Winter is coming and the clock is ticking. It’s time to get on with it.

This article appeared here in ABC Environment