Suburb-wide electrification trials to be rolled out across Australia in bid to fuel transition away from gas
The climate change and energy minister, Chris Bowen, has formally directed the Australian Renewable Energy Agency (Arena) to consider funding more pilots like Electrify 2515, a community-led initiative to electrify 500 homes in one postcode in Wollongong, NSW.
The pilot, the brainchild of local resident and Rewiring Australia co-founder Saul Griffith, offers subsidies to lower the upfront costs for households to install solar batteries and replace gas heaters, cooktops and hot water systems with electric alternatives.
The trial - backed by $5.4m in Arena funding - has received applications from more than 400 households in the 2515 postcode.
With Arena-backed electrification projects already underway in SA and the NT, the agency will now look to fund trials in the ACT, WA, Queensland, Victoria and Tasmania following the minister's direction.
The referral is the first time Bowen has used his ministerial powers to ask Arena to consider funding a specific type of project, and was part of a deal Labor struck last year with crossbenchers David Pocock, Jacqui Lambie, Lidia Thorpe and David Van to pass its Future Made in Australia laws.
Advocates such as Griffith and Pocock believe the small-scale pilots can provide a roadmap to electrify households nationwide, helping to slash greenhouse gas emissions while delivering cost-of-living relief.
Analysis in 2023 from the Commonwealth Scientific and Industrial Research Organisation (CSIRO) estimated that converting to all-electric appliances and an electric car could save an average homeowner as much as $2,250 per year on their power bills.
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The major barrier for households to make the switch is often the prohibitive upfront cost of electric appliances, meaning any nationwide transition off gas likely hinges on government subsidies.
Guardian Australia understands Labor is considering a package to spur household electrification ahead of the federal election, due in May.
The federal government has already allocated $800m to upgrade more than 100,000 social housing properties with energy efficient appliances.
Pocock - who led the crossbench negotiations with Bowen - said support to help households switch to electric appliances was one of the 'highest impact, non-inflationary' policies a government could deliver during a cost-of-living crisis.
'Globally the built environment accounts for 39% of energy-related carbon emissions so electrification will also have a huge impact in our efforts to combat climate change,' he said.
Parliamentary Budget Office modelling, which Pocock commissioned in 2022, found it would cost about $11.3m over the forward estimates to subsidise the transition for 1,000 households.
Lambie welcomed Bowen's direction but questioned why the government hadn't acted sooner.
'Surely giving low-income people the chance to save money on their power bills would be a no-brainer?' she said.
'But they didn't, but thank God we have a strong crossbench and the government has come to the party.'
While the independent Arena board will decide which projects to fund, the federal government wants to see trials in every state and territory.
'Communities across Australia are seeing the benefits of the clean energy transformation, and the Albanese government is delivering the leadership and support they need to grasp those benefits,' Bowen said.
'Arena pilot projects supporting home electrification will help create valuable insights into how households can transition to renewables and smart energy systems to cut energy costs and reduce emissions.'
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