Rewiring Australia calls on the federal government to fund a universal household electrification loans scheme

HECs-style loans could unlock the cost-of-living savings offered by electrification and reduce bills by up to $5000 per year for every Australian household permanently.

The Electrify Everything Loan Scheme (EELS) is the centrepiece of Rewiring Australia’s Pre-Budget Submission to the Australian Government. Designed to tackle both Australia’s cost of living crisis and the climate emergency, the scheme would overcome one of the major hurdles for householders wanting to electrify – the upfront cost of efficient electric appliances.

Rewiring Australia argues that a major investment like this from the federal government now will make Australia much more energy-resilient and self-sufficient whilst providing householders with relief from increasing power bills.

“The national investment case for universal electrification finance is undeniable,” says Dr Saul Griffith, Rewiring Australia’s Chief Scientist.

Rewiring Australia estimates that low-cost loans for all Australian residences - regardless of income - to install solar panels, batteries, efficient electric appliances, and an EV, could save households up to $5,000 annually on energy and petrol bills.

“If we move aggressively to electrify homes and vehicles, consumers will save $1.1 trillion by 2050, and if funded by flexible finance like EELS, the real cost to the budget will be just one-twentieth of the consumer savings.” said Dr Saul Griffith.

“If the government makes an investment like HECS, it will deliver permanent cost-of-living relief, solve the problem of light vehicle pollution and propel Australia to the top of the class in climate action,” says Griffith.

“The benefit of household electrification is a permanent reduction in energy costs, not a temporary subsidy to fossil fuel companies.”

Unlike the student HECs scheme, which is paid back over time once a former student reaches a threshold income, it’s proposed that the EELS loans be secured on a property title, indexed to inflation, and repaid when the property is sold.

Rewiring Australia estimates that between now and 2050, Australians will spend around $2 trillion dollars on the purchase of cars and appliances, and for a relatively modest public investment - potentially as small as 1.6% of the total car and appliance spend – the government could shape consumer purchasing decisions, lock in permanent bill relief and eliminate energy emissions in line with national and global targets.

The cost of establishing EELS and delivering complementary electrification policies has been calculated by Rewiring Australia to be $2.8 billion over the next three years. This includes the cost of establishing the Scheme and providing the loans, along with funding for 17 Zero Emission Communities around the country, EV charging networks, and to review and rewrite the National Electricity Market rules to make them more ‘household-centred’ and allow households to compete against fossil fuel generators and retailers.

Rewiring Australia sees the EELS scheme in a similar vein to other big government expenditure investments like universal primary health care provided by Medicare and universal access to tertiary education through HECS.

“This Labor government can create universal access for all Australian households to the world’s cheapest energy, rooftop solar,” says Rewiring Australia Executive Director, Dan Cass. “Electrification is primary health care for the planet.”

Over a third of Australian households have already invested in rooftop solar, more than any other country. Australia also has the highest solar radiation of any continent and rooftop solar is the cheapest energy in the world.

“Australia can go from being the world’s leading rooftop solar nation to becoming number 1 in electrification, which is the most powerful climate solution available,” said Dr Griffith.

Combined with decarbonising the grid, electrification of households and vehicles will eliminate 25% of Australia’s emissions.

Francis Vierboom, Market Transformation Manager at Rewiring Australia, will discuss the details of the Electrify Everything Loan Scheme in an upcoming episode of the SwitchedOn podcast.

Author
Anne Delaney
SwitchedOn Editor
April 21, 2024
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