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While the Federal Budget addresses Australia's energy security The Federal Budget addresses Australia's energy security problem by confirming a $10 billion fuel security package, it leaves a major shortfall in the absence of funding for a national home electrification loan scheme, which is the cheapest and most effective long-term solution for households to reduce their reliance on expensive imported petrol and gas.
The Federal Budget recognises Australia has an energy security problem but misses the cheapest way to solve it by helping households use less petrol and gas in the first place, Rewiring Australia said.
Tonight’s Budget confirmed a previously announced $10 billion fuel security package, after the Treasury modelled a scenario in which oil prices hit $200 a barrel and take three years to return to normal.
But it did not fund the best long-term solution - a national home electrification loan scheme to help households replace expensive petrol and gas with cheaper Australian electricity.
Rewiring Australia CEO Francis Vierboom said the Budget showed the government understood the danger of Australia’s reliance on imported fuel, but had missed the best way to reduce it.
“This Budget spends billions preparing for the next oil shock, but misses the chance to help families use less petrol and gas in the first place,” Mr Vierboom said.
“Fuel stockpiles can help manage an energy crisis but household electrification helps prevent one.
“The real energy security measure is not more imported oil sitting in storage. It is Australian homes and cars running on Australian electricity.”
Parliamentary Budget Office (PBO) costings modelled off Rewiring Australia’s proposed Electrify Everything Loan Scheme found the government could issue about $13.1 billion in loans over four years to help households install solar, batteries, efficient appliances and other upgrades.
The PBO assumed 99 per cent of loans would be repaid, collected on property sales, with a default rate of just 1 per cent. The underlying cash cost was estimated at about $1.15 billion.
“The return to taxpayers is stark,” Mr Vierboom said.
“We are financing more than $10 billion to protect Australia from a fuel system that will keep failing families, while neglecting a scheme that helps households get out of that system altogether.
“For a similar headline investment, EELS could unlock about $13 billion in household upgrades, with almost all of it paid back over time.
“That is a far more logical use of public money. Don’t just insure the country against expensive imported oil. Help families stop needing fossil fuels at all.”
Mr Vierboom also welcomed the government’s previously announced decision to keep the electric car discount for another 12 months, saying it was helping shift buying habits away from petrol and diesel vehicles and build the second-hand EV market.
“We now need to keep building the critical charging infrastructure and make the cheaper, cleaner choice the normal choice for Australian households,” he said.
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Electrifying our homes and cars is the recipe to cut emissions and save money for Australian homes. Let's build an abundant electric future for Australia.
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