Australian households are increasingly making green choices and it is to everyone’s benefit, a new report shows.
Authored by BIS Oxford Economics, QBE LMI’s latest Australian Housing Outlook ‘The Green Edition’ reveals that Australia has made many gains in the way we approach more efficient and effective green living standards.
Australia has the highest uptake of rooftop solar energy in the world, with nearly 3.2 million installations, or around 30% of all homes, as of June 20221. Installing a 5kW rooftop solar system saves the average Australian household $909 per year on electricity, with the most significant savings coming from reduced usage costs and Feed in Tariff (FiT) credits, giving households savings on their energy bill from contributing energy back to the grid.
Increasingly ambitious building regulation is leading to changes in construction of new homes including the greater use of insulation, double glazed windows and lighter coloured roofs to reduce future household emissions.
Beyond construction, households are adopting more energy-efficient appliances, heating and lighting solutions. What’s more, banks are offering green mortgages to further encourage sustainable housing and energy retailers offer renewable and carbon offset products for environmentally-conscious consumers.
The research shows that making a property more sustainable and resilient adds value to it. Across the spectrum of studies of green properties, the consensus is that energy efficient homes are valued 5% to 10% more than others even after accounting for property specific items.
Minimum insulation requirements and recommended levels vary across different climate zones. Effectively insulating the ceiling, walls and floors of a typical home saves 45-55% on heating and cooling costs with an average payback period of 5-6 years.
The most commonly installed energy-saving initiatives reported by builders, architects and designers are LED lighting and increased insulation. LEDs use 75% less energy than halogen light bulbs and last up to ten times longer. The up-front cost of LEDs generally has a payback time of less than one year.
Higher production levels and technology improvements have lowered the costs of energy efficient household appliances, such as front loader washing machines. More efficient front loader washing machines have increased their market penetration from 9% in 2000 to 47% in 2020, and now represent 67% of the washing machines offered on the market.
While rising in popularity, the adoption of lighter coloured roofs, double-glazed windows, and solar or heat pump hot water systems in Australia remains low in overall terms. Although more expensive to buy, solar and heat pump hot water systems use 60-70% less energy than a conventional electric system and reduce associated greenhouse gas emissions by around 65-70%.
The recent expansion of green home loan offerings give households the opportunity to access discounted interest rates if they build, buy or renovate a home to meet certain energy ratings, with criteria including efficient hot water systems, electrified fixtures and appliances and rooftop solar systems.
The transition to green housing was accelerated at the recent meeting of Building Ministers with the decision to mandate a minimum 7-star Nationwide House Energy Rating Scheme (NatHERS) rating for all new homes.
The report concludes that the introduction of an Australia-wide mandatory energy rating system for residential property has the potential to further incentivise the adoption of green housing in Australia similar to what has been observed in Europe.
