We all know the benefits of going green. It helps the environment, the surroundings, and the planet. Now, it can be even better for your bank. Bank Australia has recently partnered with the Clean Energy Finance Corporation (CEFC) of the federal government to provide up to $60 million of discount on an all-new home loan program.
The First-Ever Green Home Loan in Australia
Historically Bank Australia has always shown support for the environment:
- It is the first-ever bank in the world to have a Conservation Reserve.
- Bank Australia runs on renewable power, with 100% of its operations carried out with an environmentally-friendly resource.
- Since 2011, the bank has been carbon neutral, meaning the net carbon dioxide release to the atmosphere is zero.
Together with the Clean Energy Finance Corporation, the financial organisation launched a new program that would benefit green homes in the country.
The Loan Details
The idea behind the Clean Energy Home Loan stemmed from Bank Australia’s research that showed customers care about climate change and sustainability. The loan focuses on supporting potential homeowners who wish to do their part in reducing the environmental impact of their future homes.
The home loan offers qualified borrowers a 0.4% interest rate reduction for up to five years.
To be eligible, the borrower should meet one of the following requirements:
- Have a 7-star rating by the Nationwide House Energy Rating Scheme (NatHERS).
- A Residential Efficiency Scorecard rating of at least seven stars (without adding or installing rooftop solar)
- Received a Passive House Certification
- With Green Star or at least eight points on Design and As-Built v1.2
The requirements above apply to all applicants of the loan, namely existing and new homeowners. Buyers and builders of seven-star homes or above will earn a lower interest rate. Note that most states and territories in Australia have a minimum standard of six-star energy rating.
The discounted rate is awarded to borrowers for up to five years of their mortgages. The mortgage should not exceed $1.5 million.
The Clean Energy Home Loan is a part of the Premium Package Home Loan for all Bank Australia customers, as well as refinancers.
Other features of the loan are:
- Two fixed-rate options: First, a fixed 2.44% per annum interest rate for two years (3.50% per annum comp rate).The other option is a three-year fixed rate of 3.43% p.a. comp rate. These rates are for borrowers with a loan-to-value ratio (LVR) of less than 70%.
- Variable rate: Those who wish to take advantage of the variable-rate offer can have an initial offer of 2.78% p.a. (comp rate of3.39% p.a.). This rate applies to those who wish to borrow more than $500,000 with an LVR of lower than 70%.
- Eco-pause: This option is available for Clean Energy Home Loan borrowers in which they can take a break from their repayments for their mortgages. Instead, they can use their funds to upgrade their home to make it more sustainable. These upgrades include utilising solar panels, water tanks, and batteries.
In the coming months, the home loan benefits may be extended to customers who make green renovations.
The loan program, along with many other existing initiatives in the residential building sector, can contribute to as much as 25% less energy consumption.
Financial Benefits of Going Green
Potential green homeowners can add lower interest rates and discounts on their loan as another benefit of going green. The CFEC, as a government’s agency, is working to help Australia transition to decreased gas emissions in the coming years. The initiative gave way to a partnership with Bank Australia. Customers of the bank can apply for a loan with a much lower interest rate.
Aside from the Clean Energy Home Loan, there are more financial advantages that Australians can get with going green, such as:
Reduced Energy Costs
Green energy lowers the costs of energy and water. Instead of using conventional lighting, heating, and other power-hungry systems and appliances, it is time to switch to energy-efficient alternatives.
An example is air-drying your clothes when you have good weather. Simple practices, such as turning off the faucets and lights when they are not in use, can contribute significantly to lowering your utility bills.
More Customers for Firms
If you run a business, you can attract more customers. Many people these days are more interested in companies that promote the use of green energy. Of course, with more customers, you get more profits and sales.
Less Production Cost
Instead of printing documents, you can save money on ink and paper by using digital forms. A paperless office will reduce clutter and the number of trees that get cut down daily.
Lower Home Expenses
For residents, being smart with investments is a requirement today. Going green is one of the wisest decisions you can ever make.
Building a home is, without a doubt, incredibly expensive – so is making improvements. You can save costs now if you go for traditional windows, for example. However, if you choose to go green during the building process, you can save tens of dollars in the future. Instead of delaying expenses to go green in the coming years, you invest early in the game.
Take advantage of loans, such as the Clean Energy Home Loan. The discounted interest rate can give you more savings, which you can use for other improvements, such as using a thermostat or even composting.
Less Food Waste
Food waste contributes to thousands of dollars every year. You can save a lot of money by going green. For instance, if you choose to eliminate bottled water, you can cut your expenses on these beverages. You can also bring your own lunch to work instead of buying from fast food. These small steps can lower packaging waste, which can lead to at least $25 of savings every week.
Things You Can Start Doing
The property market emits about 23% of greenhouse gases in the country. Half of the number is from residential buildings, which make use of heating, air conditioning, and lighting systems.
The good news is that you can take part in going green today with the following:
Choose Solar Power
Many years ago, installing solar systems was only for the rich and famous. Average people avoided the thought of going solar because the panels, inverters, and even the installation process were expensive. Today, things have changed. You can have a solar-powered home and hot water service that uses solar as well.
One of the requirements for the Clean Energy Home Loan is to have a NatHERS 7-star rating. This rating system assesses the energy-efficiency of a building, including commercial and residential structures.
The highest rating is 10 stars, and it is based on these factors:
- Home layout
- Roof, wall, floor, and window construction
- Window orientation
- The amount of natural heating, lighting, and local breeze the home receives
- Suitability of the house to the local climate
A zero-star dwelling denotes that it does little to nothing to reduce discomfort due to hot or cold temperatures. In Australia, the standard rating is six, which means the property is good enough. However, it is not great when it comes to thermal performance.
It was only in 2003 when the national energy efficiency regulations were implemented. At that time, less than one per cent of homes in the country received a six-star rating. Thankfully, many improvements have taken place with well-designed homes growing in numbers. These homes reach seven-star ratings from NatHERS simply because they have added effective upgrades, including a solar system.
Did you know that Australia tops every other continent in the world when it comes to the average solar radiation per square metre? Solar power harnesses the sun’s energy, which is wonderfully free to use. Therefore, the necessity for mains grid electricity is reduced, which effectively lowers power costs.
Installing a rooftop solar power helps cut energy costs and reduce the impact on the environment. Make sure though that you only hire professional and trustworthy installers. Look for affordable solar packages from one of the leading solar panel and system suppliers in the country.
Harness Wind Power
Another fast-growing energy source is wind. You can increase your chances of getting approved for the Clean Energy Home Loan if you use alternative power sources, such as wind.
Compared to power plants, wind energy is a clean source of power. It does not pollute the air since it does not depend on fossil fuel combustion, which includes gas and coal. When you have a wind turbine, you are assured that it will not produce atmospheric emissions. Therefore, it lowers the instance of acid rain and does not contribute to the emission of greenhouse gasses.
According to the Australian Renewable Energy Agency (ARENA), a total of 600 gigawatts (GW) of wind energy were supplied around the world. Such an amount of electricity powered almost six per cent of the global demand. In Australia, 94 wind farms were built in 2018, which contributed to 6 GW of wind generation capacity.
Let us also not forget that wind is a sustainable source of energy. In reality, it is a form of solar energy since winds are a result of atmospheric heat from the sun, the Earth’s rotation, and the surface irregularities of the planet. As long as the sun shines, the wind will continue to blow, and energy will consistently be produced.
Another benefit of using wind for powering up homes is that it is cost-effective. With many people turning to renewable energy sources, technologies keep on improving. Wind turbines have become less expensive than before. They can also be built in rural areas since they are great for farms and ranches. The turbines do not take a lot of space, which means they will not hinder any farming work.
One of the top goals of going green is to reduce your waste production. Population growth in Australia is a significant contributor to the waste problem.
The country produces about 48 million tonnes of waste every year from three primary sources:
- Household waste, also known as municipal waste
- Commercial and industrial
- Renovation, building, and demolition
The Australian household population makes up about half of the total solid waste.
Each person adds nearly half a tonne every year with different types of rubbish:
- 3% metal
- 5% glass
- 6% plastic
- 56% food and garden waste
- 19% cardboard and other paper materials
The remaining 11% consists of other types of waste generated in households.
With such a considerable contribution to the country’s produced waste, it is high time to focus on everyone’s recycling efforts. Instead of throwing away glass, aluminium, paper, and metal, reutilise them. It is also worthwhile to contact your local waste management program to know how you can help.
When you have recyclables, make sure you do not place them inside plastic bags. You can either put them in a tub or basket before adding them to your recycling bin. As much as possible, recycle and reuse these recyclables. Putting them in general waste bins may not interfere with the waste disposal process, but they unnecessarily pile up in the landfill.
Another way to recycle is to donate your old but usable shoes and clothes. Instead of discarding, you can give them to those who may have use for these items.
One more thing you can do is to leave the labels and lids on plastic bottles that you wish to throw away. It is also helpful when you know which belongs where. For instance, garden waste should only be placed in green waste bins.
However, you should also be aware of the rubbish that you cannot put in these bins, such as branches and grass clippings. It always helps to know what you can and cannot recycle.
Whether you run a business or you are an average individual, you can now opt to go digital to stay eco-friendly. Instead of printing documents, choose online forms for specific applications. Many businesses today go for digital newsletters instead of flyers to promote new products or services. New and small firms benefit from this approach because of the lower costs.
If you truly need to print a document, use less space to save paper. For instance, you can try fitting everything on one page only.
Meanwhile, if a remote office is an option, go for it. Cars are among the biggest sources of greenhouse gas emissions in the country. Transportation, which includes going from home to work and vice versa, contributes to 17% of total gas emissions in Australia. Working from home helps reduce traffic, pollution, and even the need for road maintenance.
The popularity of cashless transactions is growing as well, which is useful to the environment. Money comes from trees, after all. Today, paper money is still valuable, but many other mediums of payment are available.
The digital approach in paying for goods and services has paved the way for the formation of e-wallets. They allowed customers to simply download an app or scan to pay for any item. Online shopping also aids in conserving gas and the need to travel to a store.
Famous Australian Green Homes
The number of environmentally-conscious homeowners in Australia continues to grow almost every day. Some of those that have inspired many new homes today include:
- The White Pebble House in Hampton, Victoria: The five-bedroom home comes with a chemical-free pool surrounded by a native garden. It also has a passive solar system installed, top-of-the-line insulation, and ventilation for heat recovery. Without a doubt, it is one of the most energy-efficient homes in the country. It also uses solar hot water and a water tank.
- NEAThouse in Dodges Ferry, Tasmania: the 104-square metre home consists of three beds and one bath. It has an energy rating of 8.1, thanks to its notable features, such as passive solar installation and timber that came from sustainable resources. The house also used other recycled building materials and finishes that are of low volatile organic compound (VOC). The windows have a thermal break, and you will find a water-wise garden outdoors.
- Phil and Donna’s Place in Mundaring, Western Australia: Another high-rated home for energy efficiency is this 204-square metre property. With an 8.1 rating, it comes with solar panels, water storage installed underground and above-ground, and highly-insulated walls. Building the house involved the use of recycled materials, including concrete pavers and brick. The windows were also reused while the floor sealer was a low-VOC product.
People build their homes for the long haul. More than half of the properties in the country are predicted to last until 2050. Therefore, the decisions we all make today can have a huge impact on emissions from now onwards. We just need to choose whether the effect is positive or negative.
The goal is to make sure we make sustainable choices, which lead to positive effects. The Clean Energy Home Loan is a huge help for those who want to start contributing to the health and sustainability of the environment.