These households are ditching gas, slashing bills and going ‘net zero’. Here’s how


In February 2020, just before the pandemic, Annabelle and Alex bought a typical Melbourne home in Brunswick East — almost a century old, draughty, and with gas heating and hot water.

After receiving a $400 gas bill in their first month, they began a process of improving insulation, swapping out gas appliances for electrical ones, and generally making the house “net zero” in terms of energy use, meaning it produces as much energy as it consumes over a period of time.

They now have no gas bills and, over the course of a year, export more electricity to the grid than they import.

All up, the transition cost them $12,000.

And within just a few years, they’re likely to make that money back.

“Having a net-zero house always seemed so impossible — it seemed that we’d have to make big lifestyle sacrifices,” says Annabelle, who works as a doctor in a COVID unit.

“But the more we learned about the technology that’s now available, we realised you don’t have to be a martyr.”

Alex adds: “Nothing changed. We just got different appliances.”

The couple in their early 30s are part of a worldwide movement that envisions a future where more people are living in comfortable, low-emissions homes and spending less on energy.

Advocates say there’s a basic health argument for this as much as a climate one: the poor quality of Australia’s housing is one reason the country has a higher death rate due to cold weather than Sweden.

The catch, of course, is the up-front cost of these new electric appliances, solar panels, insulation, and other investments.

Many Australians are also locked out of the housing market, which means they have to pay the energy bills but have little say in whether or not their house is insulated, or what appliances it runs.

So how do you make a house net zero, what does it cost, and could these houses be made available for everyone?

Stop the draughts and insulate

Back in early 2020, looking for ways to be “warm and comfortable” in their old and draughty house, Annabelle and Alex turned to the My Efficient Electric House (MEEH) Facebook group.

Formed six years ago, the group is now 35,000 users strong. Members seek and share advice and post accounts of their battle with a common enemy: household energy loss.

“The first cold weekend in south-east Australia and boom, all these people want to join the Facebook group,” says Tim Forcey, the founder of the MEEH group and a trained engineer and energy adviser.

“For 90 per cent of people who join the group, the driver is comfort.

“It is possible to tighten our houses up by a factor of 10 when it comes to ‘leakiness’.”

By leakiness, Mr Forcey means thermal energy loss. Draughty doors and poorly insulated roofs, walls and floors add to the cost of heating and cooling and multiply the dangers of extreme temperatures.

In general, Australian houses are very leaky; the Climate Council recently slammed Australian homes as “glorified tents”.

The average energy performance of homes in Victoria, for instance, is 1.8 stars on the Nationwide House Energy Rating Scheme. A house rated 1.8 stars costs 70 per cent more to heat or cool than a home rated to 6 stars, which has been the minimum standard for new homes since 2010.

The more leaky the house, the harder it is to make it net zero.

Improving insulation is the place to start, says Mr Forcey.

“You can spend a couple of thousand dollars on getting professional draught-proofing done, or you can spend $10,000 on a solar PV system,” he says.

In East Brunswick, Annabelle and Alex added insulation in the roof, replaced the louvres in the bathroom with an airtight sheet of perspex, and stopped-up the vents in the walls that had been originally installed to avoid the build-up of carbon monoxide from gas heaters and coal fires.

All up, this cost $700.

“The temperature of the house increased by 4C in winter,” Annabelle says.

Swap gas appliances for electric ones

Perhaps the easiest way to reduce energy consumption, says Mr Forcey, is to “find the heat button on the air conditioner”.

“Millions of Australians haven’t found that yet,” he says.

“The air-con is there in the lounge room but they put the remote control away after summer.”

Most air-con units sold today are reverse cycle; they’re able to heat as well as cool. On top of this, they’re several times more efficient at heating than a gas heater, which makes them cheaper to run.

According to one study, using a reverse cycle air conditioner over an efficient gas heater reduces energy costs by 45 per cent.

Annabelle and Alex stumped up $6,000 to install a split system air-conditoner.

For another thousand dollars, they replaced the gas cooker with an electric induction cooktop.

Finally, they splurged $4,000 on a top-of-the-range electric hot water heater, which was partly covered by Victorian government rebates.

Replacing this last gas appliance meant they could disconnect from the gas grid, which saved them the $1.50 daily service fee.

Consider rooftop PV solar panels

Next, Annabelle and Alex paid $1,000 (after rebates) to upgrade their existing 3.5kW rooftop solar panels to a 5kW system, which meant they were producing more energy than they consumed.

Their house’s energy needs are now effectively “net zero”.

“We’re in credit even in winter,” Annabelle says.

“We’re not stingy with electricity and we have all the modern appliances.”

The transition has cost them about $12,000 and this is entirely offset by the savings from a discounted interest rate on their home loan.

Their mortgage provider offers the special rate for customers undertaking ambitious green upgrades to their home.

Then there’s the reduced energy bills: a 2018 report found all-electric homes with a 5kW solar system save $9,000-$16,000 over 10 years, compared to gas-electric homes with no solar.

This month, a second report estimated that electrifying heating, cooking and hot water, swapping petrol cars for EVs, and installing “oversized solar” would save the average household up to $6,000 per year.

And so when Annabelle’s petrol car broke down, they bought an EV.

The Nissan Leaf EV, imported second-hand from Japan, cost $36,000.

“Most of the time we can charge the car off our panels too,” Annabelle says.

“Our personal energy use from where it was two years ago has exponentially decreased and we don’t pay any gas bills or any grid electricity bills. We don’t even pay any petrol bills.”

Putting these ideas to the test in new housing developments

Two hours south-east of Melbourne, at Cape Paterson, a housing development is testing the market for energy-efficient homes.

“I said, ‘Why can’t we build more energy-efficient homes?’ And the answer was always that there was no real market for it,” says Brendan Condon, director and founder of the development, named The Cape.

“I would say, ‘Where did you test that?’ No-one had really had a go at building a whole integrated estate.”

The 60 houses so far constructed at The Cape average 8-star energy efficiency, have 5kW of solar, and are all gas free.

“Operationally, these homes are the cheapest homes in Australia,” Mr Condon says.

A recent study of the housing development conducted by Richard Keech, an energy efficiency expert, tested that assertion.

He modelled the energy use of a two-person household in a 6-star rated house with gas heating and a petrol car with the same number in an 8-star rated house with solar, battery and an EV.

Those in the solar house spent $5,066 less per year on energy.

They also emitted 84 per cent less greenhouse emissions, the study found.

“If every house was 8-star rated and had solar and a battery, then it’s possible that the statewide savings would be in the order of millions of dollars in avoided petrol and electricity costs,” Mr Keech says.

“That’s not a trivial chunk of change.”

So what do these more efficient homes cost to build?

“There’s a slight premium to build to this higher standard,” Mr Condon says.

“I would say it’s under 5 per cent.”

Property giant Mirvac estimates the premium is lower than that.

In the south-west Melbourne suburb of Altona North, Mirvac is building a “net-zero energy” housing estate named The Fabric, partly funded by the Australian Renewable Energy Agency (ARENA).

The fully electric homes here have a minimum 7-star energy rating, at least 3.8kW rooftop solar, and battery storage.

These homes each cost about $15,000 more to build than conventional ones, says Elysa Anderson, Mirvac general manager for Residential Victoria.

As a proportion of the cheapest two-bedroom townhouse for sale in the Fabric, that’s about 2.5 per cent of the purchase cost.

And demand is high: all the homes from the first stage have been sold, and the next stages have been brought forward ahead of schedule.

“Definitely this is what Mirvac will be building as standard within 10 years,” Ms Anderson says.

“I would think that this would become a standard offering within the very near future.”

It’s a similar story at The Cape, where Mr Condon says most of the lots have been sold.

“People told me there would be no demand for energy-efficient homes and now we have 40 lots left and 13,000 people interested,” he says.

‘This is a massive health and safety issue’

Proposed changes to the 2022 National Construction Code will increase the minimum thermal performance of newly built homes from six stars to seven stars — the first increase to this figure since 2010.

It’s a welcome change, says Trivess Moore, a sustainable housing expert at RMIT, but Australia has a lot of catching up to do.

“They’re requiring zero-energy houses for new residential dwellings across the EU,” he says.

“The UK is pushing to be there in the next couple of years.

“I would estimate Australia is still somewhere in the region of 5-10 years behind — if these changes go through.”

But these changes won’t help the millions of Australians who rent, or the hundreds of thousands in public housing.

As the climate warms, Australians living in poorly insulated suburban homes are going to be more vulnerable in the face of catastrophic heatwaves.

In 2009, a record weeks-long heatwave in south-eastern Australia killed 374 people, most of them in Melbourne.

A subsequent study found that increasing the average house energy rating in Melbourne to 5.4 stars would have reduced deaths by 90 per cent.

“Everybody thinks this is about energy bills and greenhouse emissions, but this is a massive health and safety issue,” says Rob Murray-Leach, head of policy at the Energy Efficiency Council.

“What we want to be doing is making every home in Australia decent. Doing that across the board is going to do far more than making homes high end.”

How do we make every home ‘decent’?

Mr Murray-Leach has a few ideas.

First, listing the energy performance rating of a home that’s advertised for sale could be made mandatory.

Second, homes that fall below a minimum energy performance standard should not be allowed to be rented.

“This is the same as rules that say homes have to have locks on doors,” he says.

Victoria, South Australia and the ACT already have, or are working towards this.

There are also calls for a national retrofit program, similar to the EU’s “renovation wave strategy”, which aims to improve the energy performance of tens of millions of existing buildings by 2030.

For the moment, however, these retrofits are mostly being done in an ad hoc way by a relatively small proportion of owner-occupiers.

Seeking information, they often find their way to the MEEH Facebook group.

In Brunswick East, Annabelle and Alex remain enthusiastic about their choice to get off gas and go net zero.

But they’re also frustrated so few people know this is an option — that they had to go digging for information on Facebook.

“I get targeted advertising from Australian gas networks all the time, but no-one is advertising this,” Annabelle says.

Every week, a few hundred members join the MEEH Facebook group.

One by one, the pilot lights are going out., 25 October 2021