Under a Memorandum of Understanding (MOU) signed by both parties, The Clean Energy Finance Corporation (CEFC) will consider investing up to $75 million to help finance the $150 million ING Green Upgrade Loan program.
The CEFC finance is expected to help deliver a fixed rate of 3.74%, representing a discount of 2% on an ING Fixed Rate Home Loan for the first five years of the loan. On an ING Green Upgrade Loan balance of $50,000 a customer could save up to $5000 over the first five years.
Under the ING Green Upgrade Loan, eligible ING mortgage customers can apply to borrow up to $50,000 to install a range of clean energy technologies to improve energy efficiency, reduce energy use and cut emissions.
The discount rate will be available to ING mortgage customers, with eligible technologies including battery ready solar PV, battery and inverters.
Borrowers will be able to utilise the Home Energy Helper, delivered in collaboration with BOOM! Power, which can recommend appropriate clean energy technology upgrades designed to reduce energy costs and emissions based on a household’s existing systems and appliances.
CEFC CEO Ian Learmonth said: “Helping households lower their carbon footprint is a critical factor in achieving net zero emissions by 2050. Our work crowding in additional private capital through the HEUF (Household Energy Upgrades Fund) will help deliver a catalytic outcome, providing low-cost financing together with a range of co-financiers for home upgrades that improve energy performance.”
Australia’s existing 11 million homes are responsible for more than 10% of total emissions and more than 25% of electricity consumption.
ING CEO, Melanie Evans said: “Household emissions are one of the biggest contributors to Australia’s carbon footprint which is why we are doing all we to can to help customers upgrade their homes to reduce their household emissions. We’ve designed our Green Upgrade Loan following customer and mortgage broker feedback that the retrofitting process is complex and time consuming. If we want to accelerate decarbonisation, we need to remove the complexities and barriers that are stopping people from making their homes more energy efficient. We have created an experience that is stress free and customer focused.”
The Australian government has allocated $1 billion to the CEFC to create the HEUF and fast-track sustainability improvements in existing housing by providing discounted consumer finance through a broad range of co-financiers.
The CEFC has engaged extensively with the sector and received proposals from a wide range of financiers, including major banks, mutual banks, non-banks and fintech innovators. The proposals covered green mortgages, green personal loans and other innovative green finance products to improve home energy performance for homeowners, renters and strata properties.
The CEFC has received proposals for investment opportunities worth more than $850 million in green loans. It has since announced investments via the HEUF worth some $220 million. It continues to work with a range of lenders to develop products with the potential to be financed through the HEUF, with further commitments expected in 2025.
The HEUF builds on the CEFC experience in designing and leading the green home and personal loan markets, and the uptake of clean energy technologies, through its consumer finance programs, as well as investments to help improve energy efficiency across the property sector.
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