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The Canberra Times
The Canberra Times
Lucinda Garbutt-Young

Does your house's energy rating matter? Renters' wallets thinks so

In the dead of Canberra winter, university student Janet Wang uses almost no heating in her inner north share house.

The 21-year-old is one of hundreds of Canberra renters living in cold houses - often warmer out than in - because of poor insulation and inefficient energy ratings.

Last winter, her share house with five occupants had gas-ducted heating turned on for a lot of each day.

But when they used an estimated $3000 in gas during the 2023 winter quarter, they reevaluated.

"This year, we decided not to use the heater. We are all uni students and that was too expensive," Ms Wang said.

Her household turned to individual electric heaters in their bedrooms.

"Our house isn't very well insulated because it is old, so you turn a heater on for an hour and you turn it off to save on electricity. The room gets cold instantly.

"One of the bedrooms in the house doesn't get light at all. It is blocked by trees," she said.

At night, the power board in Ms Wang's share house often overloads, making it dangerous to use heaters in all the bedrooms at once.

"We have to take turns," she said, noting she sometimes turns her heater off before the coldest part of the day.

Without using gas and instead turning to electric heating, the energy bill for Ms Wang's house in the autumn 2023 quarter was $700.

Energy in Canberra rentals

In 2022, Professor Paul Burke of the Australian National University - and his colleague at Macquarie University - found there was little monetary incentive for landlords to improve the energy rating of their houses.

Professor Paul Burke found tenants were spending more on energy than those who owned. Pictures by Elesa Kurtz, Shutterstock

In their report, Effects of renting on household energy expenditure: Evidence from Australia (2022), Professor Burke and his colleague found the energy expenditure of renters was often more than those who owned their house.

In the two years since, the ACT government has announced minimum insulation standards for rentals in the territory, to be fully enacted by November 2026.

An ACT government spokesperson said monitoring of the proportion of rentals that had been updated since the regulation came into effect was underway. Findings are expected to be realised in 2025.

Energy efficiency ratings are sometimes included in rental listings.

Is there incentive for landlords to change?

"Now that energy efficiency ratings are understood, there is a stronger incentive these days for rental providers to improve their place, to make sure energy is taken into account," Professor Burke said.

"It can be a way to improve the amount of rent landlords receive.

"If it is well-measured and beneficial, the market should reward it," he said.

However, some industry professionals told The Canberra Times energy efficiency ratings were rarely a reason to up the price on a rental and landlords had little incentive to resolve energy issues.

Joel Beard, the director of Connected Agency Narrabundah, said that "investors don't want to spend money on that when they are not living at the property".

He said rental prices may be higher for considerable energy technology upgrades like solar panels.

However, Mr Beard said good energy efficiency ratings did not often factor into the price of rent.

He said the "appearance and condition" of a property was generally a bigger concern than energy ratings.

Radhika Mehra, TLS Real Estate's director of management, said questions on energy were a "one in one hundred" from tenants.

Ms Wang, who first signed a lease for her current share house in late 2022, said she had "never had a conversation with" her rental manager about energy efficiency.

"We weren't really thinking about that. We were just trying to get a house," she said.

"Rentals are hard [to get]. So I think we have just accepted it."

Professor Burke said conversations around energy needed to shift in Canberra to help renters minimise their bill, and protect the environment.

"If you see a place with a higher energy efficiency rating remember you can save money on your bills," Professor Burke said.

Ms Wang does not intend to move now, but would prioritise a house with good insulation and an energy efficient heater if she were to do so.

What is an energy efficiency rating?

An energy efficiency rating is a number between one and 10 given to your entire home.

To work out your home's number - 10 being the best - assessors measure things like glazing, insulation, house orientation and kinds of energy in your house.

Under federal law, new builds must now reach a seven but there is no standard for established dwellings.

You can measure your house's energy consumption yourself using an ACT Energy Action Kit, which can be picked up from a Canberra library branch.

The Canberra Times tried to borrow a kit but there was a waiting list of 74 people.

The ACT government runs an energy saving advice program for renters, which includes a free home test.

The government also has a borrowing scheme for home energy upgrades and Renters' Home Energy Program.

"This program provides renters with a free in-home energy assessment by an expert assessor who provides tailored advice on how to stay comfortable in the home while reducing energy use and costs," a spokesperson said.

A home energy efficiency program is delivered by St Vincent de Paul and is for homeowners and renters experiencing financial hardship.

Households are supported with free energy efficiency advice to reduce energy costs and draught-proofing to improve thermal comfort. Eligible households, including renters, can access thermally-backed window coverings.

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