New policy research from the University of New South Wales (UNSW) Centre for Sustainable Development Reform has revealed councils are critical to the delivery of local solutions to Australia’s home energy efficiency crisis but lack the funding to accelerate their efforts.
While federal and state policies remain fragmented, 129 councils have already developed innovative programs responsive to local climate and community needs. See here for the full report: Accelerating Home Energy Efficiency Upgrades.
Key findings:
- Local councils and community organisations are showing evidence of filling policy gaps left by federal and state governments with local energy efficiency programs
- 129 out of 537 Australian councils have developed energy efficiency programs. Victoria is leading, possibly due to stronger state government support
- Research indicates need for dedicated Commonwealth and state funding to enable councils and community organisations to expand locally-driven solutions
On 18 September 2025, the Federal Government announced its 2035 climate target of 62-70 per cent reduction in emissions as part of the plan to net zero by 2050.
The Built Environment Sector Plan, that accompanied that target, recognised the critical role that improving home energy efficiency will play in delivering these outcomes. It has been previously established that the average Australian house built before 2010 rates just 1.8 stars out of ten using the national energy rating system.
Councils stepping up
The policy mapping undertaken by UNSW Centre for Sustainable Development Reform examined home energy efficiency commitments at all three levels of government. It found major gaps in federal policies and vastly different levels of commitment across states and territories. In this context, local councils have stepped in to deliver programs tailored to their communities.
The report highlights that council-led initiatives are effective because they respond to local climate conditions, housing stock and address equity gaps in higher-level policies.
Council programs range from supporting households to upgrade thermal envelopes (insulation, draught proofing, window replacements) to establishing local energy efficiency advisory services and facilitating bulk-buy schemes for upgrades.
Victoria demonstrates the greatest number and most comprehensive programs, indicating that state government commitment is a strong factor in facilitating local action. Community organisations dedicated to upgrading energy efficiency are also springing up across the country, often in collaboration with local councils to deliver locally-attuned solutions.
Funding needed to accelerate progress
This report’s recommendations identify the need for coordinated federal and state funding to be made available for local councils, plus expanded support for community groups already delivering innovative local solutions. This would substantially accelerate existing efforts attuned to local conditions. While home energy efficiency is not ‘core business’ for councils operating under state law, they have significant influence through planning instruments and local programs that can drive real change in their communities.
Dr Natasha Larkin from the UNSW Centre for Sustainable Development Reform said that accelerating home energy efficiency is primarily the responsibility of federal, state and territory governments.
“Yet local governments and community organisations are already playing a critical role with programs attuned to their local climate, building stock and community needs,” Dr Larkin said.
“Extending this momentum requires the Federal and State Governments to provide dedicated funding that enables councils and community groups to expand these locally driven efforts.”
Across the nation, reform is most needed to assist households to upgrade the thermal envelope of buildings (such as insulation, draught proofing and replacing windows). There is a need for greater access to finance to offset the high upfront costs of upgrades (particularly for lower-income households) and targeted policy attention for rental properties.
More information, visit Accelerating Home Energy Efficiency Upgrades.
