Many homes in Australia were built before building energy standards were introduced, which has resulted in millions of homes wasting too much energy.
Residential buildings are responsible for around 24% of overall electricity use and more than 10% of total carbon emissions in Australia. Houses and apartments with poor energy performance impact the wider economy and the energy grid.
The Australian Government is working with state and territory governments to improve home energy efficiency. This will reduce energy bills, make homes more comfortable to live in, and help reduce carbon emissions.
Key measures include:
- improving the energy efficiency of new and existing homes
- improving home energy ratings and disclosure
- assisting households to make informed choices about their energy use and appliance purchases.
Funding for household energy upgrades
In the 2023–24 Budget, the Australian Government allocated $1.3 billion to establish the Household Energy Upgrades Fund.
The Clean Energy Finance Corporation will have $1 billion to partner with banks and other lenders to offer low-cost finance and mortgages for energy performance upgrades to more than 110,000 homes.
Loans will be available to upgrade homes with battery-ready solar PV, modern energy-efficient appliances and other improvements, creating more comfortable homes that waste less energy.
Read more about the Clean Energy Finance Corporation and how the loans will work.
The Fund also sets aside $300 million for upgrades to around 60,000 social housing properties, to save tenants money on their energy bills. The upgrade program will be co-funded and developed with state and territory governments.
More information will be made available as the program is developed.
Trajectory for Low Energy Buildings – residential initiatives
The Trajectory for Low Energy Buildings is a national plan that aims to achieve zero energy and carbon-ready commercial and residential buildings in Australia. It is a key initiative to address Australia’s 40% energy productivity improvement target by 2030 under the National Energy Productivity Plan (NEPP).
Read on to learn more about key actions under the plans.
Guidance for consumers
Practical guidance is being delivered to explain the ‘what’, ‘why’ and ‘how’ of upgrading the energy performance of homes. This includes:
- Your Home, Australia’s comprehensive guide to building, buying or renovating sustainable homes
- energy.gov.au, which provides high-level information to households on how to reduce their energy bills while living in a comfortable home.
Supply chain development
We are working to deliver industry training to improve the knowledge and skills of key building and trades professionals. This training helps industry implement energy efficiency improvements and provide households with access to energy saving products.
For a range of training resources, go to energy.gov.au.
Home energy ratings
The Nationwide House Energy Rating Scheme (NatHERS) provides reliable energy performance ratings for new homes and major renovations.
Driven by leading CSIRO science, the scheme is helping build more energy efficient, resilient and comfortable homes for the future.
NatHERS provides a ‘thermal’ energy rating for the design and construction of a new home, which estimates the amount of heating and cooling the home will require to stay comfortable in your climate.
NatHERS has been expanded to also provide a ‘Whole of Home’ energy performance rating, which predicts the annual energy use of the home, including major fixed appliances, solar and batteries.
NatHERS ratings can demonstrate how a home meets or beats requirements set in the National Construction Code.
Ratings for existing homes
In April 2023, the Australian Government announced funding to expand NatHERS to offer energy ratings for existing homes.
These new ratings will help householders better understand their home’s energy performance, identify cost-effective upgrades to improve the comfort of their home, and reduce their energy bills.
The ratings can also underpin ‘green’ loans at reduced interest rates. Homeowners will be able to apply for these loans to undertake energy performance upgrades on their homes.
Ratings for existing homes will be available from mid-2025. Trials are planned in 2024 with the finance sector, property valuers and energy assessors.
Improving minimum energy performance
The National Construction Code (NCC) helps ensure buildings are sustainable, safe, healthy, have suitable amenities and are accessible.
On 26 August 2022, Building Ministers agreed to raise the minimum thermal energy rating for new homes. Ministers took advice from the Australian Building Codes Board (ABCB) based on extensive regulatory impact analysis and consultation. As a result, NCC 2022 now requires that new homes achieve the equivalent of 7-stars (out of 10) for NatHERS thermal performance.
The Whole of Home rating was also added. This assessment (out of 100) predicts the annual energy use of the home including heating and cooling, and energy generated and stored on site.
These changes, (from 1 October 2023), will reduce energy demand, emissions, and bills. It’s estimated the new requirements will save an average of $183 every year on power bills for new homes.
States and territories are adopting the new requirements at various times. See the Australian Building Codes Board website for more information.
Home energy efficiency disclosure
Providing a home’s energy performance rating and information at the point of sale helps people choose a more comfortable and energy efficient home.
Energy Ministers agreed a draft National Framework for Disclosure of Residential Energy Efficiency Information (PDF 1.3 MB) in 2021. The final framework is expected in late 2023.
The framework will support a market environment that encourages energy efficiency disclosure and will provide coordinated settings for state and territory governments to implement their own disclosure schemes.
For further background see:
- National Collaborative Approach to Residential Building Ratings and Disclosure – Principles
- Supporting energy efficiency upgrades for existing homes through informed policy and program design: Social housing sector perspectives report (PDF 4.6 MB)
- Finance industry sector perspectives report (PDF 7.5 MB)
- Market Environment for Disclosure (PDF 83 KB)
Equipment Energy Efficiency program
The Equipment Energy Efficiency (E3) program is an initiative that delivers a single, integrated program on energy efficiency standards and energy labelling for household appliances in Australia and New Zealand.
- Changes Associated with Efficient Dwellings Project Report
- House Energy Efficiency Inspections Project Report
- Residential Buildings Regulatory Impact Statement Methodology Report
- The Evaluation of the 5-Star Energy Efficiency Standard for Residential Buildings
- Your Home - Design for Place energy-efficient house plans and evaluations
- Your Home case studies
- 2021 Residential Baseline Study for Australia and New Zealand for 2000-2040