The simple switch that could save retirees $86,000

The simple switch that could save retirees $86,000 

New modelling shows Australians could save almost $90,000 over their retirement by ditching fossil fuels and switching to electric homes with solar and batteries.

The analysis from Rewiring Australia found households that replace gas appliances and petrol cars with efficient electric alternatives spend around $4,300 less each year than comparable gas households after costs are averaged over time.

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Rewiring Australia CEO Francis Vierboom said with the average Australian retiring at 65 and now living well into their 80s, upgrading to electric appliances is one of the most obvious decisions a household on a fixed income can make.

“For a single retiree, a comfortable retirement costs roughly $50,000 a year and our modelling shows you can make a big dent in that amount by simply changing how your home is powered.

“When you average energy bills, transport costs and appliance replacements over time, fully electric homes are significantly cheaper to live in even after accounting for the cost of upgrading.

“Electrifying your home is not a luxury upgrade - it’s basic common sense if you’re planning to live another 20 years on a retirement income,” Mr Vierboom said.

Mr Vierboom said rising living costs are pushing retirees to reassess household expenses, and Rewiring Australia’s network of more than 100 community groups has seen an uptick in enquiries about electrification.

“More and more retirees are reaching out after realising this is a good move for the planet as well as a  practical retirement cost‑of‑living strategy.”

A practical solution to help more retirees electrify

Upfront costs to electrify remain a major barrier for many retirees and Rewiring Australia is calling for a government‑backed HECS-style loan to be established which allows households to make the switch without finding tens of thousands upfront. Rewiring Australia’s proposed Electrify Everything Loan Scheme (EELS) fixes the problem of people missing out on savings because they can’t afford the initial cost and could be  specifically targeted to pensioners and concession card holders who are currently among the least able to afford upgrades.

The  inflation-indexed loans could be used for households to install solar, batteries, heat pumps and other electric improvements, with repayments only required once an upgraded home is next sold.

“This would provide peace of mind for thousands of Australians who struggle with energy bills and deliver long‑term savings and emissions reductions and most importantly - a more comfortable retirement,” Mr Vierboom added.

Where the savings come from

Rewiring Australia’s modelling shows savings are delivered across the whole household:

• Space heating: Replacing gas heating with reverse‑cycle air‑conditioning saves around $530 a year, or $8,500 over 15 years including upfront costs.
• Hot water: Switching from gas to a heat‑pump hot water system saves $250-$400 a year, delivering $2,500-$5,400 in lifetime savings.
• Cooking: Moving to electric cooking saves around $400 over 15 years but if this is your last part of the home still connected to gas, households can disconnect from gas entirely, avoiding supply charges of around $270 a year, or $4,700 over 15 years.
• Transport: Electric vehicles save $1,500-$2,500 a year in running costs, delivering $17,000 to $35,000 in savings over 15 years.
• Solar and battery: Fully electrified homes save around $2,300 a year when they add solar and battery (including the savings from the Cheaper Home Battery subsidy scheme) - or $34,500 over 15 years.

Average annual costs (15‑year average) including finance for upfront costs:

• Gas household: $17,300 per year
• Fully electric household: $13,000 per year
• Average annual saving: ~$4,300 which equates to $86,000 over 20 years or $64,500 over 15 years.

The above data is based on comparisons between a gas household (gas heating, hot water, cooking and petrol vehicles) and a fully electrified household (efficient electric appliances, rooftop solar and a home battery).

All figures include upfront costs (including buying appliances and one vehicle), replacement costs for appliances and another vehicle, energy bills, fuel costs and financing.

About Rewiring Australia

Rewiring Australia is an independent, non-profit and non-partisan organisation working to accelerate the electrification of everything, for everyone. The organisation represents households, communities and businesses in the energy system, using robust data and analysis to demonstrate how electrification cuts costs, reduces emissions and improves health. Rewiring Australia delivers practical climate progress through research, education, advocacy and on-the-ground work with communities to enable rapid electrification. Its work has reached millions of Australians and supports a fairer, healthier, zero-emissions future powered by renewable energy.

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