Our research shows why conversations about home electrification should go hand in hand with conversations about improving home insulation and energy performance. 

Electrifying an energy efficient home reduces net demand, meaning faster decarbonisation at scale.

Globally, governments are keen to decarbonise buildings faster. Australia is no exception.

This is good news for the climate with buildings accounting for a fifth of our emissions, and good for people because, by buildings, we also mean homes. 

The technologies, materials, and construction practices needed to decarbonise homes are mature, tried, and tested.

From our research for Climateworks Centre decarbonisation scenarios 2023 and Renovation Pathways, we know what needs to be done at scale:

These are electrification and thermal shell upgrades. Our recommendations are similar to those from RMI (Jan 2024) in the USA, and Renovate Europe (Apr 2023).

Aerial photo of suburb
Electrification brings many benefits to households. (Unsplash: Tom Rumble)

Climateworks welcomes recent contributions from Rewiring Australia that highlight the need for rapid home electrification to support Australia’s transition to net zero emissions.

Our research also shows the decarbonisation dividend multiplies when any home renovation is paired with efforts to replace gas with electricity. 

By renovating and rewiring simultaneously, Australia can reduce total energy demand, resulting in faster community-scale decarbonisation and comfier homes.

As our decarbonisation scenarios show, it will take everything all at once to keep Australia on the road to net zero. Buildings are key. 

2024–2026 is set to be a busy period for building policy development. In April 2024, the Australian Government released the National Energy Performance Strategy (NEPS), which outlined its commitment to improving home energy performance.

The government is reviewing the Trajectory for Low Energy Buildings and accompanying Addendum, which sets out implementation policy and timeline, agreed nationally in 2019. 

Later this year, the Climate Change Authority will release the Built Environment Sectoral Pathway and the federal government will release further consultation details for the Built Environment Sectoral Plan, the document that will guide the way Australia reduces buildings emissions. 

With these tailwinds, even more can be done to capitalise on the opportunities that electrified, efficient buildings provide. 

Optimising electrification for a renovation wave across Australia

Electrifying an energy-efficient home is preferable to electrifying a poorly performing one.

Electrifying alongside or after thermal shell upgrades helps make electricity demand as low as possible and helps maintain a comfortable indoor temperature while reducing energy loss. 

Electrification brings many benefits to households.

Electrifying cooking appliances and removing gas fireplaces and heaters immediately makes for healthier homes by removing nitrous oxide and benzene fumes.

There is also an immediate financial benefit from not having to pay a service charge for access to gas.

Homes with rooftop solar save even more if higher-demand appliances – such as those used for space heating and cooling and hot water heating – can be used while the sun is shining

According to our ‘Climate-ready homes’ report, if Australian homes electrified just the appliances used to meet basic needs – having a hot shower and cooking – they would save between 2.9–3.7 MWh of energy per year on average.

This means each home that switches from gas to electricity for hot showers and cooking could achieve a reduction in carbon emissions by 0.59–0.62 tCO2.

That means the annual emission savings from electrifying cooking and showers are equivalent to forgoing 3.4 trips by plane or 5.9 trips by car from Melbourne to Sydney. 

Homes in colder states such as Victoria, Tasmania and ACT could save even more money and emissions through electrification. The lowest-performing homes in these places could save the most on their energy bills by switching to all-electric heating and cooling. 

Our research shows that electrifying space conditioning appliances together with low-cost ‘quick-fix’ upgrades can deliver average bill savings between $1,272 for townhouses and $1,845 for detached houses.

‘Quick-fix’ thermal shell upgrades include adding ceiling insulation and basic gap sealing around windows and doors.

New research highlights the importance of electrification and proper insulation going hand in hand. Negative experiences with energy efficiency upgrades can stall efforts to make more homes energy efficient and to decarbonise quickly Australia needs a wave of energy efficient renovations. 

The co-dependency of home construction quality and space conditioning do need to be considered. To give consumers the best experience, electrification and insulation should be considered together, according to our research. Our ‘climate-ready’ upgrades in which all appliances, including energy-hungry space conditioners, can significantly reduce peak demand. 

Future trends: What’s next for homes?

As Australia transitions to net zero emissions, so too will its homes. Both new and existing homes will need to be all-electric and energy-efficient – a precondition of the grid’s successful transition to a renewable energy grid, powered by wind and solar, in 2050. 

As rooftop solar turns homes into mini energy generators, buildings have already become a key part of a clean energy system. 

In the not-too-distant future, electric vehicles will enter the home energy conversation as electric vehicle and home battery uptake will turn homes and cars into energy stores as well as clean energy generators.

Our research shows how governments can help residents take the next step to make the most of the changes on the horizon. 

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