Westpac Launching Low-Interest Sustainable Home Upgrades Loans

The first low-interest bank loans supported by the Clean Energy Finance Corporation’s (CEFC’s) Household Energy Upgrades Fund (HEUF) will be available from next week to eligible Westpac home loan customers.

The federal government backed $1 billion HEUF is focused on assisting homeowners accelerate performing energy-efficiency upgrades to their homes. This is particularly important given millions of Australia’s houses were built before sustainability measures such as energy standards were introduced. The minimum energy standard for new homes in Australia is 7-stars currently, but homes built before 2003 have an average rating of just 1.5 stars.

While new homes are faring much better these days on energy efficiency, there is still room for improvement. And with so many old and new homes having a dizzying array of appliances, gadgets and gizmos; opportunities for boosting energy efficiency should be pursued where possible and viable. This includes solar households – particularly when the “sun ain’t shining” as they still often pay through the nose for mains-supplied electricity during these periods, or use more self-generated solar energy than needed that could be directed to other applications.

There’s certainly appetite among Australians for improving their home’s energy efficiency. According to Westpac:

It can be a long way from considering these upgrades to taking action. Low interest loans and other financing options done right can help get households over the line.

From next Monday, Westpac owner-occupier and investor home loan customers will be able access a variable interest rate of 4.49% p.a. for a loan to improve a home’s energy efficiency or climate resilience. Customers will be able to apply to borrow from $4,000 up to $50,000 with a loan term of up to ten years.

“We recognise more Australians want to play their part to reach a net zero future, and that starts at home,” said Westpac’s Jason Yetton.

But for many families struggling with the cost of living, environmental warm and fuzzies would take a back seat to the opportunity of saving serious cash on their energy-related outgoings.

A CEFC investment of $160 million in the scheme will mean Westpac is ready to fund at least $320 million worth of Sustainable Upgrades loans.

“We expect to leverage Westpac’s significant share of the home lending market and strong mortgage customer base to further develop the home energy upgrades ecosystem and deliver real impact,” said CEFC Executive Director Richard Lovell.

Westpac’s share of the home loan market was pegged at 21.4 per cent last year.

Eligible Energy Efficiency Upgrades

Customers will have a number of upgrade options that could be funded to choose from. Currently, Westpac lists:

• Approved solar power systems equal to or greater than 5kW capacity.
• Solar batteries on the Clean Energy Council’s list of approved batteries.
• Approved solar hot water systems – including the costs for removal of gas connections and appliances.
• Approved heat pump hot water systems – also including the cost of ditching of gas connections and appliances.
• Air conditioners – as above.
• Induction cooktops  - as above.
• Insulation with minimum thermal performance of R2.5 for underfloor and walls; R4/R5 for ceiling (R value depends on state).
• Double glazed windows with a Window Energy Rating Scheme (WERS) U-value of 4.0.
• Level 2 EV chargers.
• Pool pumps with a minimum 6-star energy rating.

Also eligible are selected climate resilience upgrades related to mitigating bushfire, flood, storm and cyclone risks.

As with any loan offer, there are various other conditions; but nothing that at first blush seems too onerous. But do bear in mind this is a variable interest rate loan that could fluctuate over time.

There’s also freedom of choice in terms of the companies loan customers can purchase their upgrades from; assuming suppliers, installers and equipment meet basic criteria. But this also means more due diligence is required when making a purchase decision – and the SolarQuotes guides linked to above can help there.

Commenting on the initiative, Federal Assistant Minister for Climate Change and Energy Josh Wilson stated:

“This investment will help people with older homes and appliances that don’t meet modern energy standards to upgrade and keep money from leaking out the door.”

… or leaking out the window, ceiling, or walls – or to energy retailers.

If you’re interested in finding out how much home energy storage and/or solar could save you, try SolarQuotes’ easy-to-use solar and battery calculator.

Original Source: https://www.solarquotes.com.au/blog/energy-efficiency-loans-westpac-mb2989/