Senator Pocock's additional comments

Introduction

1.1Residential electrification and improving energy efficiency in Australian homes should be at the centre of Australian energy policy. Evidence to this inquiry underscores the urgency and opportunity of accelerating these initiatives to enhance energy affordability, improve public health, stimulate economic growth, and reduce carbon emissions.

1.2We need to move faster and go further, which requires ambition from both major parties—ambition has been sadly lacking to date.

1.3I support the recommendations made by the Chair’s Report and the convincing evidence contained within the report. However, I would like to emphasise that household electrification and the benefits it offers must be available to all Australians. Renters, those who live in apartments and low-income households need substantial attention to ensure that household electrification does not worsen inequality.

Clear and ambitious national targets and ambitious investment

1.4The Committee heard evidence that indicates that clear targets stimulate investment and provide market certainty. Beyond Zero Emissions recommends electrifying 5 million homes by 2035 to capture significant economic and environmental benefits, highlighting substantial employment opportunities associated with this transition.[1]The Grattan Institute emphasizes the necessity of setting clear end dates for gas connections to facilitate orderly transitions,[2]echoed by ATSE's call for immediate action and defined national benchmarks to expedite residential electrification.[3]

1.5A broad coalition of 69 groups have come together under the banner Renew Australia For All to call for an immediate $5 billion investment in electrification and home energy efficiency, and a $50 billion investment over the next 10 years.[4]

1.6The UTS Institute for Sustainable Futures highlights affordable credit and regulatory support as key to overcoming cost barriers for households.[5]Similarly, the Grattan Institute and the Institute for Energy Economics and Financial Analysis reinforce the critical role of upfront financial support to mitigate initial capital costs and incentivize consumer uptake.[6]

1.7That the Australian Government establish clear national targets for household electrification, including an initial goal of electrifying at least 5 million homes by 2035, aligned with Australia's commitment to reach 82% renewable energy by 2030.

1.8That the Australian Government invest in an ambitious program of household electrification and energy efficiency upgrades consisting of $5 billion investment immediately and $50 billion over the coming 10 years.

1.9That the investment in Recommendation 2 financial incentives, including rebates and low-interest financing, to reduce upfront costs associated with household electrification technologies.

Household electrification for all, not the privileged few

1.10Household electrification is not equally available to all Australian households. Renters, apartment dwellers and households with lower incomes all find it more difficult to electrify. Submitters including the Battery Storage and Grid Integration Program (ANU) recommending tailored solutions to address the unique barriers faced by these groups.[7]The Smart Energy Council supports this approach, emphasizing the need to empower renters with better incentives and transparency on energy efficiency.[8]

1.11There are various policy options available to provide more equitable access to household electrification for rental properties. Climateworks proposes ensuring rental properties achieve minimum energy performance standards and require disclosure of energy efficiency ratings at the point of sale.[9] Other submitters, such as the Australian Academy of Technological Sciences and Engineering proposed tax changes to provide incentives to owners of rental properties.[10]One solution is to make capital gains tax and negative gearing tax benefits contingent on properties having rooftop solar and a household battery.

1.12Various submitters proposed ways to increase the availability of household electrification to low-income households. Climateworks Centre supports targeted financial support, including low-interest financing specifically designed to overcome financial hurdles faced by low-income households.[11]

1.13The Australian Government develops policies to ensure that rental properties, multi-dwelling structures and low-income households have equal access to household electrification.

Household batteries in the Small-scale Renewable Energy Scheme (SRES)

1.14Helen Haines MP's submission demonstrates how integrating batteries into the SRES could substantially reduce battery costs, enhance energy security, and lower household energy expenses.[12]

1.15Expand the SRES to include home battery systems, significantly reducing their installation cost and promoting widespread adoption.

Address skills shortages and build domestic supply chains

1.16Beyond Zero Emissions points to current skills shortages as significant barriers to scale and highlights the job creation potential of comprehensive workforce strategies.[13]IEEFA and the Smart Energy Council similarly advocate proactive investment in workforce and local manufacturing capabilities.[14]

1.17Establish a workforce development programs and enhance domestic supply chains for key electrification technologies.

Reform of the governance of the National Electricity Market and energy market rules

1.18I provided extensive additional comments to a recent report from the Select Committee on Energy Planning and Regulation in Australia. My proposed pathway for reform is contained within those comments

1.19Commence a process to reform the design of the National Energy Market in accordance with my additional comments to the recent report from the Select Committee on Energy Planning and Regulation in Australia.

Conclusion

1.20These recommendations, backed by extensive expert submissions, provide a clear, comprehensive strategy to rapidly accelerate household electrification and energy efficiency across Australia. Their implementation will deliver substantial economic, environmental, and social benefits, positioning Australia as a global leader in the sustainable energy transition.

Senator David Pocock

Independent Senator for the Australian Capital Territory

Footnotes

[1]Beyond Zero Emissions, Submission 42.

[2]The Grattan Institute, Submission 28.

[3]Australian Academy of Technological Sciences & Engineering, Submission 5.

[4]Renew Australia for All - https://renewaustraliaforall.org/wp-content/uploads/2024/09/Renew-Australia-for-All-Explainer-A4.pdf

[5]UTS Institute for Sustainable Futures, Submission 21.

[6]See, for example, The Grattan Institute, Submission 28; IEEFA, Submission 23.

[7]BSGIP, Submission 42.

[8]Smart Energy Council, Submission 32.

[9]Climateworks, Submission 20.

[10]Australian Academy of Technological Sciences and Engineering, Submission 5.

[11]Climeworks, Submission 20.

[12]Dr Helen Haines MP Independent Federal Member for Indi, Submission 17.

[13]Beyond Zero Emissions, Submission 42.

[14]Institute for Energy Economics and Financial Analysis (IEEFA), Submission 23, Smart Energy Council, Submission 32.