How to reduce your energy bills

Man installing a LED light

RACV Staff

Posted June 08, 2023

Save energy and reduce your power bills this year with these easy tips around the home.   
Many households are looking to their energy bills to find savings. 

There are plenty of savings to be had too, with a number of quick and easy things you can do around the home to reduce your energy use and help avoid bill shock.

Making your home more energy efficient | RACV

How to save energy and reduce your power bills

Install LED lighting

Lighting is a big consumer of energy in the home, accounting for up to 10 per cent of your bill, especially if you’re using older-style incandescent or halogen light bulbs. According to Energy Rating, these types of light bulbs can use 60W of power, compared to new energy efficient bulbs, such as LEDs and CFLs, that use only 10W. 

Therefore, switching to energy efficient lighting can help to reduce your overall energy usage and potentially lower your power bill. A qualified electrician can help you upgrade your lights over to LEDs.

Wash your clothes in cold water 

When it comes to washing your clothes, using hot water costs more and can speed up the deterioration of some fabrics, fade colours and increase the likelihood of clothes shrinking. 

Switching to a cold wash can cut between 80 to 90 per cent of washing machine running costs, according to Energy Rating. New washing machines are also often equipped with an ‘eco’ wash program which reduces power consumption by automatically using a colder water temperature and low-energy spin cycle.

Save your hot washes for items like heavily soiled clothing, towels and bedding.

Person hanging clothes on a clothes horse

Make sure you're using your dryer at its most efficient, or try a clothes airer instead. Image: Getty


Use a clothes airer instead of clothes dryer

Clothes dryers can be useful, but a clothes airer or good old-fashioned washing line can work just as well without using additional energy. 

If you must use a clothes dryer, try to use it most efficiently. That means wringing your washing out using your washing machine’s spin cycle first, keeping the filters clean and putting the correct amount of drying in per cycle – filling the drum half full is a good general guide.  

Update your appliances and adjust their settings 

It’s important to check your appliance settings as this can impact your energy consumption. For example, ensuring that your fridge is set at the right temperature (and not running too cold), as well as adjusting the brightness of the television, or wash program of your washing machine, can all play a part in reducing your energy consumption.  

Older appliances are also usually less energy efficient than new ones. So, while it might be appealing to hang on to the same washing machine, clothes dryer or television until they no longer work, replacing them with newer and more energy-efficient models may be more cost-effective in the long run. Replacing an existing gas or electric stovetop with an induction cooktop is not only more energy efficient, it’s also safer.

Don't forget to switch appliances off directly at the power socket when they're not in use, either. Appliances left on standby mode are a hidden energy hog in the home and can still add to your electricity consumption. 

Thinking of purchasing or upgrading your fridge, washing machine, or another appliance? Here’s how to read Energy Rating Labels to understand how energy efficient common household appliances are. 


solar panels on a rooftop

Solar panels and solar hot water systems can help you reduce your energy consumption. Image: Getty


Install solar panels 

Australia already has the highest proportion of residential rooftop solar energy in the world with around three million solar homes and businesses, with residents using solar energy to power everything from electronics and appliances to lighting, hot water systems, air conditioners and even electric vehicles.  

In fact, installing solar energy can save the average household over $890 annually in power bills according to Solar Victoria.  
Installation of solar panels can be completed in just one day on most single story homes, and you may be eligible for a solar rebate depending on the size of your home. You may also be eligible for a green loan to help finance the cost of installing solar panels.  
To estimate the cost of a solar system and your potential annual savings , plug your average daily energy use and the number of panels you want into the RACV Solar calculator.

Swap to a solar water heater or heat pump

Everyone loves a hot shower. Unfortunately, hot water systems account for 21 per cent of energy usage in the average home, making them one of the biggest sources of energy expenditure.

Switching to a solar hot water system or heat pump can save the average household between $140 and $400 a year on their bills. These systems not only rely on cleaner energy, but they’re more energy efficient, using less energy to heat the water for your shower or bath.

You don’t need to have solar panels installed to get a solar hot water or heat pump system, with rebates also available.


adjusting the temperature on an air conditioner

Save on energy by setting your thermostat between 18°C and 20°C in winter and 25°C and 27°C in summer. Image: Getty


Purchase an energy monitor 

An energy monitor can help you track your energy consumption through the day and identify opportunities to save on energy, such as undertaking some household tasks at off-peak times.   

 Energy monitors are available to most households with a smart meter, and you may even be eligible for a rebate through the Victorian Energy Upgrades program. 

Some energy providers may also offer discounted usage rates during ‘off-peak’ periods when typical use is often lower, thus placing less strain on the grid. Running energy-thirsty appliances like washing machines during these off-peak periods can help you reduce your bills, but it may not be convenient for all households. Check with your energy provider to see if your plan offers off-peak discounts. 

Adjust the thermostat 

Heating and cooling the home is one of the biggest contributors to your electricity bill. While it might be appealing to keep your home extra toasty when it’s cold outside (and run the heater all night), look for more energy efficient ways to keep yourself warm, such as an electric blanket. 

The same principles apply in summer when overusing air conditioners can increase your energy bills. Try staying cool with a portable or ceiling fan instead, which are relatively cheap to run. If your air conditioning unit has an external compressor, make sure it’s covered by shade so it’s not having to cool itself, as well as your house.

Aim to keep your heater between 18 and 20 degrees celsius in winter and your air conditioner between 25 and 27 degrees celsius in summer. Every degree outside of those parameters can add 5 to 10 per cent to your energy use.

Regularly servicing your heating and cooling systems can also make sure they’re running at their maximum efficiency.


Feet in warm, sheepskin slippers on a woven rug

Using energy efficient ways to keep warm and insulate your house, such as placing rugs or using an electric blanket, can save you having to turn the heating on. Image: Getty


Close doors and draw curtains

When heating or cooling the home, ensure that all doors are closed so that air doesn’t escape the room you’re in, because the harder your heater or air conditioner works, the greater your energy consumption.   
Drawing the curtains during the hottest part of the day (typically from 11am -3 pm) can help keep your home cooler and reduce your reliance on air conditioning. Curtains that are thick, touch the floor and completely cover windows are the best at blocking out the sun. Installing external roller shutters can further reduce the amount of heating or cooling needed to keep your home comfortable.

Draught-proof doors and windows

Draught-proofing is an easy home improvement that can deliver significant savings on your electricity bill, especially in winter. Draughts allow warm air out of a room and force your heating system to work harder.

Use weather stripping around doors and windows, and a door snake or door seal at the bottom of doors, to reduce draughts in your home.

Insulate your home

Roof and ceiling insulation alone can save up to 45 per cent on your heating costs according to

Insulating walls, floors and windows can also reduce your reliance on heating. If your budget doesn’t quite stretch to professional wall and floor insulation, placing thick rugs throughout your house can still make a tangible difference. Upgrading to double-glazed windows can help prevent heat loss, with economical options like laminates and heavy curtains also an option.

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