Green bank unlocks cheap loans for home energy upgrades

Marion Rae |

Power bills could be slashed if homeowners take advantage of cheap loans to install solar panels.
Power bills could be slashed if homeowners take advantage of cheap loans to install solar panels.

Australians will soon be able to get their hands on cheap loans and save on power bills as the federal green bank makes its first investment from the $1 billion household energy upgrades fund.

The $60 million commitment announced on Friday will support cheaper finance for solar panels, home batteries and other energy efficiency upgrades through discounts of up to 2.74 per cent annually on lender Plenti’s green loans.

The nation’s 11 million homes are responsible for more than 10 per cent of national greenhouse gas emissions and more than a quarter of cent of electricity consumption goes on inefficient energy systems such as heating, cooling and hot water.

“These loans will let more Australians put solar panels on their roof or a battery at their back door, providing big savings on their energy bills for decades to come,” Energy Minister Chris Bowen said.

Solar panels can be seen in Brisbane
Going solar and installing a battery could save households thousands over decades. (Jono Searle/AAP PHOTOS)

Plenti chief executive Daniel Foggo said consumers wanted to lower their energy bills and reduce household emissions but had been put off by the high up-front costs. 

“Discounted finance will help households overcome these cost barriers and … extend the benefits of clean energy to consumers,” he said.

Eligible customers can get a further 0.6 per cent discount on the green loan if they sign up to be part of a virtual power plant through the financial technology company’s platform, GreenConnect.

On a loan balance of $25,000, eligible customers could save more than $3500 in interest over seven years, compared with the Plenti standard green loan rate, and make their homes warmer in the winter, cooler in the summer and cheaper to run.

A residential power meter
Upgrading a house from a one-star to a three-star rating can reduce energy bills by 30 per cent. (Jono Searle/AAP PHOTOS)

Clean Energy Finance Corporation boss Ian Learmonth said there had been strong private sector interest, including proposals covering more than $850 million in potential green loans from 16 financiers. 

Consumers will be able to apply for a cheap green loan from Plenti from June 5, which will be distributed through its 600-strong trusted equipment installer network.

“More than seven million homes were built before national codes included energy performance standards,” Assistant Minister for Climate Change and Energy Jenny McAllister said. 

“Just upgrading a house from a one-star rating to a three-star rating can reduce energy bills by 30 per cent, and the fund will help more than 110,000 households access lower cost green loans to do just that.”

AAP