9 February 2016
The Clean Energy Finance Corporation has announced a major new program to help drive the construction of market-leading energy efficient community housing in 2016. The program will deliver lower energy costs for low income families and residents while helping improve Australia’s cities and built environment.
The CEFC expects its new $250 million Community Housing Program to contribute to the construction of as many as 1,000 new energy efficient dwellings Australia-wide, via Australia’s network of Community Housing Providers.
At the same time, Community Housing Providers will be able to access finance to retrofit existing buildings to improve energy efficiency for tenants. This could include measures such as switching to LED lighting, updating household appliances, installing solar panels and improving insulation.
The CEFC finance will fill a funding gap, providing Community Housing Providers with access to long-term debt finance aligned to their portfolio needs, according to CEFC Community Housing Sector Lead Victoria Adams. Finance provided under the CEFC Program can be used to complement funding or finance sourced from other state government initiatives or co-financiers.
“Community housing is already a substantial part of Australia’s overall housing stock, and is expected to experience strong growth in the years ahead because of high tenant demands,” Ms Adams said.
“Community Housing Providers have typically faced financing constraints which has limited their ability to invest for the long term. We see this finance program as an important way to help ensure new dwellings are built to meet this growing demand, and that new buildings have stronger energy efficient standards, so tenants can experience the benefits of lower energy costs over the longer term.”
As part of its new Investment Mandate, the CEFC has a strong focus on financing emerging and innovative renewable energy technologies, energy efficiency and cities and the built environment. Buildings with a seven-star NatHERS rating may use a range of measures to improve energy efficiency, such as using more energy efficient building materials in their construction, featuring double glazing on their windows, or including high quality insulation and ventilation to reduce heating and cooling needs.
The CEFC has also released its new Market Report: Financing Energy Efficient Community Housing. The Report identifies strong demand for new Community Housing over the next decade, requiring significant private sector investment. However it notes that community housing organisations have limited sources of revenue to fund new building and have generally faced challenges sourcing private finance.
Ms Adams said: “Over the next year, our goal is to help finance the construction of 1,000 new dwellings, built to an average seven-star rating under the Nationwide Housing Energy Rating Scheme (NatHERS). With this standard, energy use can be reduced by an estimated 25 per cent, delivering significant savings benefits to tenants and building owners.
“In our discussions with the sector there is widespread recognition that energy costs can be a substantial burden on low income tenants. By giving providers access to long-term debt finance, we are helping them unlock the benefits of energy efficiency through better construction options. This CEFC finance will work alongside other relevant government housing initiatives, delivering long-term benefits for our cities and the built environment.”
Media release, 2016