The multimillion-dollar energy bill saver that could soon be coming to a suburb near you

More Australian households could soon get access to significant government subsidies to help lower their energy bills.

It's part of an extension of $144 million in electrification programs that have been running over the past six years.

But what does that actually mean? This is what you need to know.

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What has the government just announced?

Federal Climate Change and Energy Minister Chris Bowen announced this morning that he has directed the Australian Renewable Energy Agency (ARENA) to "consider funding for more community electrification demonstration projects".

This comes off the back of "Electrify 2515" – a $12 million pilot program delivering subsidies to help households in the 2515 postcode (around Wollongong, just south of Sydney) install energy-efficient electric appliances and stop using gas power.

It's one of 49 projects backed by ARENA to the tune of $144 million over six years, and Bowen's direction means the agency is now looking to replicate the pilot in the ACT, Western Australia, Queensland, Victoria and Tasmania.

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What impact will it have on households?

Homes that end up being able to participate in the programs will get support to install solar panels, home batteries and efficient appliances, as well as access shared community energy storage.

By shifting away from gas power and onto more solar electricity, the government and energy experts say households stand to benefit from significant savings to their energy bills.

"In this cost-of-living crisis one of highest-impact, non-inflationary things governments can do is to help households electrify and deliver thousands in permanent power bill relief," David Pocock, one of four senators who worked with Bowen before his referral, said.

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However, the cost of changing appliances and other devices has kept lower-income families from being able to electrify – and access those savings – which the programs aim to address.

"On average, homes with rooftop solar save $1500 per year on energy bills and the Climate Council, along with other organisations, has long called for those savings to be more accessible to low-income households," Climate Council chief executive Amanda McKenzie said.

On top of the savings for households, experts say the projects will help Australia reduce emissions and transition away from fossil fuels in the energy grid.

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"The government's initiative to implement suburb-wide electrification trials aligns closely with the suburban-wide microgrid concept, which I believe is both practical and urgent for our energy transition," Swinburne renewable energy expert Professor Mehdi Seyedmahmoudian said.

"These trials are designed to enable communities and individual households to participate in an open, distributed energy market where energy is produced, consumed, and managed locally.

"This approach not only offers technological benefits but also presents an appealing business model for private sector investment in developing community-level energy management and transaction technologies...

"By scaling these proven strategies to a suburban context, the suburban-wide microgrid can accelerate the energy transition, enhance resilience, and support a sustainable future for communities across Australia."

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