Switching to a cheaper energy plan is one way to save money—but reducing your energy consumption can save even more. In 2026, with electricity prices still elevated, energy efficiency is more important than ever. Here are the most effective ways to cut your household energy use.
Heating and Cooling (40% of Energy Use)
Heating and cooling account for the largest share of household energy consumption. Small changes here can make a big difference.
Quick Wins
- Set your thermostat wisely: Every degree above 20°C in winter or below 26°C in summer adds 10% to your heating/cooling costs.
- Use ceiling fans: Fans use a fraction of the energy of air conditioners and can make rooms feel 4–5°C cooler.
- Close doors and vents: Only heat or cool the rooms you’re using.
- Use curtains and blinds: Close them during hot days to block heat; open them on sunny winter days to let warmth in.
Bigger Investments
- Insulate your home: Ceiling insulation is the single most effective upgrade, cutting heating and cooling costs by up to 45%.
- Seal gaps and draughts: Gaps around doors, windows, and floors let conditioned air escape. Weather strips and door seals are cheap and effective.
- Upgrade to a heat pump: Reverse-cycle air conditioners (heat pumps) are 3–5 times more efficient than electric heaters for both heating and cooling.
Hot Water (25% of Energy Use)
Hot water is the second biggest energy user in most homes.
Quick Wins
- Lower the thermostat: Set your hot water system to 60°C (or 50°C for instantaneous systems). Any higher wastes energy.
- Take shorter showers: Cutting your shower by 2 minutes can save thousands of litres of hot water per year.
- Fix leaking taps: A dripping hot water tap wastes energy 24/7.
Bigger Investments
- Install a heat pump hot water system: Heat pumps use 60–75% less energy than conventional electric systems. Government rebates can offset the cost.
- Add a timer: If you have an electric storage system, use a timer to heat water during off-peak hours.
- Insulate pipes: Insulating hot water pipes reduces heat loss, especially for long pipe runs.
Appliances and Electronics (15% of Energy Use)
Appliances and electronics add up, especially standby power.
Quick Wins
- Switch off at the wall: Standby power can account for 10% of your electricity bill. Turn off TVs, game consoles, and chargers when not in use.
- Use energy-efficient settings: Run dishwashers and washing machines on eco modes and with full loads.
- Switch to LED lighting: LEDs use 75% less energy than incandescent bulbs and last years longer.
- Unplug second fridges: If you only use a bar fridge occasionally, turn it off when not needed.
Bigger Investments
- Upgrade to efficient appliances: Look for high energy star ratings when replacing fridges, washing machines, and dryers. A 4-star fridge uses half the energy of a 2-star model.
- Consider induction cooking: Induction cooktops are faster and more efficient than gas or electric coil cooktops.
Solar and Batteries
If you haven’t gone solar, 2026 is still a great time:
- Solar panels: A typical 6.6kW system can offset 70–90% of a household’s electricity use, paying for itself in 4–6 years.
- Batteries: Home batteries let you store solar for use at night, reducing reliance on expensive grid electricity during peak hours.
- Government rebates: Check for state and federal rebates on solar, batteries, and energy-efficient upgrades.
Behavioural Changes
Sometimes the best savings come from simple habits:
- Wash clothes in cold water: Heating water for washing uses significant energy. Modern detergents work well in cold water.
- Air dry clothes: Skip the dryer when possible. A clothesline costs nothing to run.
- Cook efficiently: Use lids on pots, match pot sizes to burners, and use microwaves or air fryers for small meals.
- Shift usage to off-peak: If you’re on a time-of-use tariff, run appliances overnight or during the day (if you have solar).
How Much Can You Save?
The potential savings from energy efficiency are significant:
| Action | Estimated Annual Saving |
|---|---|
| Set thermostat to 20°C (winter) | $150–$200 |
| Install ceiling insulation | $400–$600 |
| Upgrade to heat pump hot water | $300–$500 |
| Switch to LEDs (10 bulbs) | $100–$150 |
| Turn off standby power | $100–$150 |
| Install solar (6.6kW) | $1,000–$1,500 |
Combined, these measures can cut your energy bill by 40–60%.
Government Programs in 2026
Take advantage of available support:
- Federal rebates: Check for rebates on solar, batteries, and energy-efficient appliances.
- State programs: Many states offer interest-free loans or rebates for insulation, heat pumps, and solar.
- Energy audits: Some states offer free or subsidised home energy audits to identify savings opportunities.
The Bottom Line
Energy efficiency isn’t just good for your wallet—it’s good for the planet. In 2026, with electricity prices elevated and technology improving, there’s never been a better time to make your home more efficient. Start with quick wins, plan for bigger upgrades, and watch your energy bills shrink.