Bright Sparks Seeking a Just Change
Everyone from Prime Minister Kevin Rudd down has identified that one of the biggest political challenges of an emissions trading scheme is the impact it will have on low income earners. One group of Future Sustainability Leaders participants is taking great strides in developing a program to counter this problem. Their project, “Just Change”, has been developed to reduce barriers to residential energy efficiency for low income renters. There are an estimated 500,000 low income rental households in Victoria alone. While these households use comparatively less energy, they spend a much higher proportion of their overall income on it — a problem likely to be exacerbated by the introduction of an emissions trading scheme. Just Change member Roland Dillon said they were hoping to assist this disadvantaged group adapt to climate change, while promoting social equity through energy efficiency.
Even if they could afford it, installing insulation — the most effective form of energy efficiency — requires the consent of the landlord. Compounding the problem is that information on the financial assistance available for energy efficiency can be difficult to access. Just Change aims to bring landlords and tenants together in a win–win situation. “This issue of split incentives is a world–wide one and it’s only ever really been tackled well in the UK,” said Roland. “There is a lot of funding available for energy efficiency measures. Our job is to bring the two groups together — tenants and landlords — to help them access these funds and to set up formal structures and arrangements to make it easier for both sides.” Roland said the response from the Tenants Union of Victoria and the Real Estate Institute of Victoria had been very encouraging. Just Change is piloting a project involving ten low income households. With subsidies, it is expected to cost $1000 per household to retrofit the homes with insulation, carbon–fluro light bulbs, draught stoppers and water–saving shower heads. The group hopes that if the pilot is successful, it will pave the way for a much wider rollout of the program, with significant environmental and social justice benefits. Just Change comprises Roland, Michaela Lang, Kathryn Bowen, Bonnie Learmonth, Kati Thompson and Dougal McInnes. The Just Change Advisory Board includes former Deputy Premier and Environment Minister John Thwaites, Ian Porter, Senior Consultant at Nous Group and Sustainability Victoria Board Member Mike Hill.
“Energy efficiency is the most cost effective way to reduce emissions in the residential sector,” said Roland. “It is also the easiest way to reduce the financial impact of electricity price increases that will flow from an emissions trading scheme. As a percentage of income, low income households spend twice as much on electricity as average households.” The problem is that landlords have little incentive to retrofit their properties as they incur all the upfront costs and don’t directly benefit from the savings. At the same time, low income households are less likely to be able to find the money to meet the upfront costs, even if the payback period is quite short.
Annual Report 2008
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