Renters Could Save $20B With Solar, If Landlords Step Up

Nearly a third of Australian households are renters, and most are stuck paying energy bills that could be cut in half with the right upgrades.

New research from the Institute for Energy Economics and Financial Analysis shows that rooftop solar, insulation, and efficient appliances could save renters $20 billion within a decade and $107 billion by 2050. The upgrades would pay for themselves while making homes more comfortable year-round.

The problem isn't the technology. It's motivation.

Energy analyst Jay Gordon explains the "split incentive" dilemma: landlords pay for upgrades, but tenants get the lower bills. Without financial benefit, most property owners simply don't invest in improvements.

The numbers tell the story. While 44% of homeowners have installed solar panels, only 11% of renters enjoy that same benefit. Rental properties also lag behind in insulation and efficient heating and cooling systems.

Victoria is leading the way with minimum energy efficiency standards for rentals starting in March 2025. The IEEFA report recommends other states follow suit with requirements that broken gas or inefficient appliances be replaced with efficient electric alternatives.

The Ripple Effect

The benefits extend far beyond individual households. When rental properties become more efficient, everyone wins.

The upgrades would reduce strain on power networks during peak demand periods, keeping the grid stable when it matters most. In states like Victoria where gas heating is common, switching to efficient electric systems would free up gas supply for critical industries.

Independent energy consultant Tim Forcey points out that renters don't have to wait for landlords to act. Simple changes like switching shower heads, draft-proofing doors, and using reverse cycle air conditioning for heating instead of gas can deliver immediate savings.

Even creative solutions like applying bubble wrap to windows create a double-glazing effect that keeps homes warmer in winter and cooler in summer. These reversible upgrades won't anger landlords but can still cut costs significantly.

Gordon notes that future reforms could make popular tax incentives like negative gearing conditional on meeting minimum energy standards. That would give landlords real motivation to invest in upgrades that benefit everyone.

The path forward is clear: with the right policies and incentives, millions of Australian renters could enjoy lower bills, more comfortable homes, and a lighter environmental footprint.