Energy equity in electrifying ACT households

2023-01-01

In the order of 25,000 households in the ACT will require material assistance to transition off gas by 2045 to meet the ACT Government’s net zero emissions commitment and reduce energy hardship. Common Capital was engaged by the ACT Environment, Planning and Sustainable Development Directorate to identify a mix of budget neutral, off budget and regulatory mechanisms that could support the electrification of households at risk of being left behind in the energy transition.

Key takeaways

There are prohibitively high upfront costs associated with measures that materially reduce energy costs. The complete electrification of a typical ACT household requires around $11,000 in up front upgrade costs – approximately $4,900 more than replacing these appliances with new gas appliances.
Economic barriers are further compounded by a lack of structural power to take action for the 25% of households that rent their homes.
There are higher upfront costs associated with electrifying households early but greater long-term energy bill savings. The total capital cost of electrifying the lowest income quintile of gas customers over the next four years would be around $221.1 million but would deliver a net present value of $347.8 million in energy bill savings (to 2045).
Without material levels of assistance, it is unlikely a significant number of lower income households will be able to electrify. A portfolio of complementary long-term policy measures can spread electrification costs across households, landlords and the public – unlocking the investment required to provide the greatest assistance to those in most need.
For a home with solar PV, lower cost electrical appliances – such as resistance water heaters – may improve costs and benefits.

Energy equity in electrifying ACT households

Key takeaways

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