Allegra Spender (Wentworth, Independent) Share this | Hansard source

s SPENDER () (): It's no secret that people across the country are struggling with the cost of living. It's the biggest issue facing constituents in Wentworth, where each week I have a steady stream of constituents contacting me asking the government to do more. Outside of housing, energy bills are one of the biggest drivers of our current challenges, with the retail electricity tariffs rising by more than 20 per cent. These energy price rises have been driven by Australia's dependence on expensive and volatile fossil fuels, which spiked with the war in Ukraine. And while we're seeing some moderation as we get more cheaper renewables into the grid, the challenges facing families are acute.

The government must take further action on household power bills, and we should be looking to our American counterparts for inspiration. It's now just over a year since President Biden signed the US Inflation Reduction Act. The IRA is the single biggest investment ever made in transitioning America's energy system from one based on expensive fossil fuels towards one based on cleaner, cheaper renewable energy. It's a landmark inflation-busting bill that has lowered costs for many American families, spurred domestic manufacturing and made historic investments in climate action. The US IRA includes $369 billion in energy and climate spending, which could nearly triple over the decade. The IRA has also played a critical role in stimulating large-scale renewables, advanced manufacturing and future industries such as hydrogen.

But the key to the US IRA was the focus placed on the demand side: where Americans use energy in their homes, vehicles and small businesses. Under the IRA, the average household in America qualifies for around $14,000 in incentives to electrify and lower their power bills. They get a 30 per cent rebate when they install more-efficient electrical appliances, like hot water heat pumps. They get a 30 per cent rebate when they buy rooftop solar or a household battery. And they get a 30 per cent rebate when they purchase a second-hand electric vehicle. These incentives are helping households to permanently reduce their power bills through cheaper renewables and improved home energy performance and, at the same time, make a difference to the planet. The impacts are clear to see. US inflation is down to 3.7 per cent, 272 new clean energy projects have been announced, and carbon emissions are projected to decline at twice the rate expected previously.

The US IRA is already delivering for the American economy and our climate. In our cost-of-living crisis, Australia needs its own inflation reduction act, not only because of our once-in-a-generation opportunity to lead the world in clean energy exports, critical minerals and advanced manufacturing but also because it is the best way to reduce household power bills right now. I welcome the government's commitment to developing an IRA response. We need to see this urgently, and households must be at the centre.

The government has made welcome commitments in the budget, but the $1.3 billion commitment is just one-tenth of the incremental investment that Rewiring Australia estimated is needed to electrify every Australian home. If Australia was to match the scale of incentives under the US IRA, the investment required would be much higher. When we put households at the centre of an Australian IRA we must ensure that nobody is left behind—in particular, the one-third of Australians who rent. Renters make up 45 per cent of my electorate of Wentworth. But, despite recent government announcements, they remain locked out of the opportunity to permanently reduce their power bills through electrification. They're dependent on their landlord to make upgrades to their property, but landlords don't benefit from the lower power bills that come from switching out expensive gas for more-efficient electrical appliances.

That's why two weeks ago I joined my crossbench colleagues in presenting the government with a fully costed proposal that would turbocharge the installation of more than 10,000 additional hot water heat pumps, induction cooktops and energy-efficient home heating each year. When combined, they will reduce renters' power bills between $514 and $594 each year. Measures like these are essential to reducing household power bills and our carbon emission and must be included as part of Australia's response to the Inflation Reduction Act.

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