Imagine a Victoria where electricity price rises didn’t cause a ripple because all Victorians – homeowners and renters alike – lived in energy-efficient homes, even making their own electricity from the sun.
Where homes were more comfortable to live in – warmer in winter and cooler in summer – and vulnerable Victorians were shielded from the health impacts of extreme weather events like heatwaves.
Where thousands of Victorians were employed in a thriving energy efficiency industry, manufacturing, selling and installing efficiency measures like insulation, efficient lighting and draught-sealing in our homes.
And where smart energy and water use in our homes was helping us cut greenhouse emissions, fight climate change and save water for our rivers.
That’s our vision for Victoria.
The transition to clean energy is underway and inevitable, but we must make sure it’s fair and no-one is left behind. Without strong government leadership, hundreds of thousands of Victorians will remain locked out of home efficiency and solar upgrades that would cut their bills and reduce Victoria’s climate pollution.
In the lead-up to Victoria’s 2018 state election, the One Million Homes Alliance is calling on all parties to commit to ambitious policies to transform the efficiency of Victoria’s homes.
The ‘Safe and Sustainable Homes for All: Roadmap to 2025’ sets out a comprehensive agenda for action to drive large-scale change. Key initiatives include raising building standards for new and existing homes, making it easier for households to get trustworthy, relevant advice on efficiency and solar upgrade options, expanding affordable finance, and significantly scaling up efficiency retrofit programs for Victoria’s one million low income and disadvantaged households.
With the number of Victorians being disconnected from essential gas and electricity services continuing to rise and time running out to turn around our climate pollution, we need all parties contesting November’s state election to set ambitious, measurable efficiency goals and a clear pathway to achieve them.
The One Million Homes Alliance brings together Victoria’s leading environment, social sector, local government and consumer organisations who share a commitment to transforming the efficiency and affordability of Victoria’s housing.
Right now with a major review of Victoria’s rental laws underway, we have a massive opportunity to bring rental housing up to scratch by requiring properties to meet a basic ‘homeworthy’ standard before they can be leased.
The energy efficiency of Victorian houses is bad enough, but rental properties are even worse. Hundreds of thousands of Victorians are living in rental homes which are dangerously hot in summer and freezing in winter, or waste too much energy to keep at a healthy temperature.
And given that rental homes make up nearly a third of our housing, if they are missing out on efficiency upgrades, then Victoria is missing out on a big opportunity to cut climate pollution.
While many landlords do the right thing by their tenants in terms of repairs and maintenance, it’s also true that most landlords don’t take advantage of voluntary efficiency programs even when they are free. There’s not much incentive for landlords to invest in relatively invisible measures like insulation or draught-sealing while it’s the tenants who reap the benefits of lower bills and better living conditions.
The only way to fix this problem is to set minimum standards for health, safety and efficiency that all rental properties need to meet before they can be leased.
Our Six Steps to Efficiency Leadership report spells out how the Victorian government could deliver on its promise to lead on efficiency, stimulating $10 billion of investment and creating up to 13,000 jobs.
Our plan could be achieved through a mix of targeted assistance for home-owners in the lowest income bracket, as well as improved standards, better information and financial incentives to assist all other home-owners and landlords invest in improvements.
It’s practical, cost-effective and could be funded by the estimated $2.5 billion the government stands to save over the next 20 years from its energy concessions budget.
The One Million Homes Alliance has welcomed the Victorian government’s commitment to an “efficient, productive and resilient state” as outlined in the November 2017 Energy Efficiency and Productivity Strategy, June 2015 energy efficiency and productivity statement “Saving energy, Growing Jobs”.
The August 2015 announcement of increased Victorian Energy Efficiency Targets to 2020 was a good first step. There is now an opportunity to follow up with further important reforms to strengthen the scheme further.
We’ve also welcomed several recent funding announcements for retrofit programs targeting low-income households, people with chronic health conditions and households experiencing energy hardship in the Latrobe Valley.
Every time we experience a record-breaking heatwave like ones in 2009 and 2014 or a severe cold snap, the costs mount up. Electricity and water use soars, as do our household bills and our greenhouse emissions. The electricity grid struggles to cope with the spike in demand, threatening blackouts and fuelling high prices.
And tragically, hundreds of Victorians lose their lives, making extreme weather events (particularly heatwaves) responsible for more deaths each year than any other natural disaster.
But there’s nothing inevitable or unavoidable about many of these impacts – a large chunk of which can be blamed on the ineffectiveness of our responses and in particular the poor quality of our housing.
Too many of us live in homes that use too much energy to stay comfortable, generating millions of tonnes of greenhouse emissions every year and costing us money in unnecessary power bills. For many Victorians that cost is simply unaffordable, consequently costing the Government millions more in energy concessions.
Raising the efficiency of a home from 2 to 5 stars could save a household up to $600 a year on their energy bills. But low-income households – those who need the savings the most – are missing out because they can’t afford the up-front costs, and/or because they rent.
Energy efficiency is also one of the cheapest and fastest ways to cut our greenhouse emissions, and is a premium area for employment growth.
There’s a lot of air transfer through draughts and gaps; not much effective insulation in the roof, walls or floor; and heat radiates straight in or straight out through windows.
And when you consider that heating and cooling accounts for about half of total energy use in the average Victorian household, that’s potentially quite a lot of money ‘blowing in the wind’.
From 2005 new homes and extensions have been required to be built to a minimum 5-Star standard and this has since been increased to 6-Star.
But 1.9 million of Victoria’s 2.2 million homes were built before 2005, at a time when water conservation, energy efficiency and energy prices were a long way from builders’ and residents’ minds.
While every house is different, most pre-2005 homes will see a significant improvement in performance from spending less than $5000 on basic measures such as:
Victoria already has a minimum 6-Star standard in place for all new homes and renovations. So the next big task is to bring the rest of Victoria’s homes up to scratch and into the 21st century. Increasing the efficiency of these older homes is a big project, and the State government needs to take a lead in making it happen.
The One Million Homes Alliance is calling on the government to commit to progressively improving the standard of all of Victoria’s pre-2005 homes over 10 years, with a focus on low-income households.
We can get this done most cost-effectively with a combination of government investment in retrofits for the most disadvantaged households, and a range of policy measures that create real incentives for home-owners and landlords to upgrade their properties. Complementary policy measures targeting business could also drive improvements in non-residential and commercial buildings.
Improve standards for residential buildings
Facilitate accessible and affordable finance
Create a culture of efficiency
Deliver targeted programs for those in need
Upgrade government buildings
Drive improvements in non-residential buildings
Read our report Six Steps to Efficiency Leadership for more information about these policy options.
While every house is different, most pre-2005 homes will see a significant improvement in performance from spending less than $5000 on basic measures such as draught-sealing, insulation, window treatments and water-efficient fittings.
A 10-year comprehensive retrofit program targeting low-income households would start with a pilot of 5,000-10,000 homes in the first year, increasing to 100,000 homes in later years as the lessons learnt from the pilot were scaled up into full program delivery.
The program could be funded through a combination of direct assistance for lowest income home-owners, and a mix of financial incentives (such as rebates and low-interest loans), market-based schemes such as the Victorian Energy Efficiency Target (VEET) and policy measures such as minimum standards to encourage and assist the rest of Victoria’s home-owners and landlords to invest in upgrades.
Most of the cost to government in rolling out this program would be covered by an estimated $2.5 billion the Victorian government stands to save in the energy concession payments it makes to households who are struggling to pay their bills.
And we know from our research and industry experience that most home owners can pay off their investment in retrofit improvements within 7-10 years just through the savings they make on their electricity bills.
And once the initial investment – by government or private householder – is paid off, the savings still keep coming. So it’s a win-win situation for everyone.
The Alliance is a partnership between Victoria’s leading environment, social sector, local government and consumer organisations who share a commitment to a sustainable society, where all Victorians enjoy equitable access to efficient, healthy housing and affordable clean energy.
Members include Victorian Council of Social Service, Consumer Action Law Centre, Moreland Energy Foundation, Alternative Technology Association, Uniting, Consumer Policy Research Centre, Brotherhood of St Laurence, Tenants Victoria, Northern Alliance for Greenhouse Action, Yarra Energy Foundation
The Alliance is working to show the State government that Victorians support energy and water efficiency, and that it needs to deliver a proper plan of action.
Safe and Sustainable Homes for All: Roadmap to 2025