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What Order Should You Do Your Home Energy Upgrades?

7 April 2026 · 10 min read

Most advice about home energy upgrades boils down to "get solar." That's fine as far as it goes, but it ignores the fact that there are half a dozen other upgrades that can pay for themselves, and the order you do them in genuinely matters.

Each upgrade changes your energy baseline. Install solar first, and your electricity bill drops, which changes how much you save from every upgrade after it. Ditch gas entirely, and you eliminate the daily supply charge on top of the usage savings. The right first move depends on where you live, what energy you use, and what you are paying for it.

We ran our calculator for a typical 3-bedroom, gas-connected home in every Australian capital to see how the optimal sequence differs. All savings are in nominal dollars. All profit figures are in today's dollars over 15 years (meaning future savings are discounted so a dollar saved in year 10 counts for less than a dollar saved today). A positive profit means the upgrade beats a 10% annual return.

These numbers assume your appliances and car are at end of life

Every upgrade in these sequences assumes you are replacing something that is due for replacement anyway. The cost shown is the full price of the electric alternative, not an additional spend on top of a working appliance.

If your gas hot water system is 2 years old, do not rip it out to install a heat pump. If your car is 3 years old, do not sell it to buy an EV. The economics only work when you are comparing the electric option against buying another gas or petrol replacement at the point where your current one needs replacing.

The calculator lets you specify the age of each appliance and your car. When you do, it delays that upgrade to the natural replacement point and adjusts the profit figures accordingly, including removing any rebates that may have expired by then. If you leave the age fields blank, the calculator assumes everything is at end of life. That is what the numbers below show: the best case, where every switch happens at the natural replacement point.

Sydney: Solar first, then electrify

  1. Solar + Battery ($15,384 cost, $63,189 savings). $16,205 profit in today's $
  2. EV ($8,250 cost, $35,707 savings). $10,959 profit in today's $
  3. Heat Pump Hot Water ($2,475 cost, $11,567 savings). $2,997 profit in today's $
  4. Induction Cooktop ($1,400 cost, $8,660 savings). $2,698 profit in today's $
  5. Home Automation ($2,000 cost, $5,061 savings). $471 profit in today's $
  6. Draught Sealing ($200 cost, $1,042 savings). $374 profit in today's $
  7. Insulation ($1,700 cost, $3,615 savings). $41 profit in today's $

Total investment: $31,400. Total savings: $128,800. Profit in today's dollars: $33,700.

Sydney has high electricity rates (36c/kWh) and good sun, so solar delivers the biggest absolute return by a wide margin. After that, the EV and gas switches round out the plan. Every upgrade on the list beats the 10% benchmark.

Melbourne: EV first, then solar, then the gas disconnection plan

  1. EV ($8,250 cost, $24,659 savings). $5,638 profit in today's $
  2. Solar + Battery ($19,032 cost, $43,625 savings). $2,731 profit in today's $
  3. Reverse Cycle Heating ($4,500 cost, $21,481 savings). $5,660 profit in today's $
  4. Heat Pump Hot Water ($2,855 cost, $10,954 savings). $2,328 profit in today's $
  5. Induction Cooktop ($1,660 cost, $9,685 savings). $2,924 profit in today's $
  6. Draught Sealing ($600 cost, $1,516 savings). $181 profit in today's $

Total investment: $36,900. Total savings: $111,900. Profit in today's dollars: $19,500.

Melbourne is completely different from Sydney. Lower electricity rates (27c/kWh) mean solar is less dominant, and an EV at current fuel prices actually comes out on top. The big story is the gas disconnection plan: switching heating, hot water, and cooktop saves a combined $42,000 over 15 years. The heating switch alone saves $21,500, and Victorian Energy Upgrade (VEU) rebates knock $3,500 off the cost.

Brisbane: Solar dominates, gas switches are marginal

  1. Solar + Battery ($12,425 cost, $46,078 savings). $10,614 profit in today's $
  2. EV ($8,250 cost, $35,707 savings). $10,959 profit in today's $
  3. Home Automation ($2,000 cost, $4,321 savings). $113 profit in today's $
  4. Heat Pump Hot Water ($2,830 cost, $5,958 savings). at the benchmark
  5. Induction Cooktop ($1,800 cost, $7,662 savings). $1,827 profit in today's $

Total investment: $27,300. Total savings: $99,700. Profit in today's dollars: $23,500.

Brisbane homes typically have gas hot water and cooktops but not gas heating. Excellent sun makes solar the clear winner. The heat pump hot water switch barely meets the 10% benchmark here because QLD does not have the same VEEC or ESS rebates that bring the cost down in VIC and NSW. But the cooktop switch still makes sense because completing it eliminates the gas supply charge.

Adelaide: The best returns in the country

  1. Solar + Battery ($14,852 cost, $79,142 savings). $24,717 profit in today's $
  2. EV ($8,250 cost, $35,204 savings). $10,717 profit in today's $
  3. Heat Pump Hot Water ($2,675 cost, $11,037 savings). $2,545 profit in today's $
  4. Induction Cooktop ($1,500 cost, $9,693 savings). $3,087 profit in today's $
  5. Home Automation ($2,000 cost, $6,540 savings). $1,185 profit in today's $
  6. Draught Sealing ($600 cost, $1,923 savings). $399 profit in today's $
  7. Insulation ($2,100 cost, $5,084 savings). $348 profit in today's $

Total investment: $32,000. Total savings: $148,600. Profit in today's dollars: $43,000.

SA has the highest electricity rates in the country (43c/kWh), which makes every kilowatt-hour you save or generate worth more. Solar alone delivers nearly $25,000 in profit. Even home automation, draught sealing, and insulation beat the benchmark here, whereas they are borderline in most other states.

Perth: Strong solar, simple plan

  1. Solar + Battery ($12,655 cost, $48,769 savings). $11,756 profit in today's $
  2. EV ($8,250 cost, $36,711 savings). $11,443 profit in today's $
  3. Heat Pump Hot Water ($3,025 cost, $10,438 savings). $1,914 profit in today's $
  4. Induction Cooktop ($1,800 cost, $5,254 savings). $686 profit in today's $
  5. Home Automation ($2,000 cost, $4,571 savings). $234 profit in today's $

Total investment: $27,700. Total savings: $105,700. Profit in today's dollars: $26,000.

Perth gets excellent sun and has the lowest gas supply charge in the country ($91/year), so the incentive to ditch gas is weaker than in eastern states. Solar and the EV are the big wins. The gas switches still make sense but contribute less to the total.

Hobart: Insulation matters more here

  1. EV ($8,250 cost, $24,659 savings). $5,638 profit in today's $
  2. Solar + Battery ($18,116 cost, $43,451 savings). $3,726 profit in today's $
  3. Insulation ($2,100 cost, $6,001 savings). $742 profit in today's $
  4. Draught Sealing ($600 cost, $2,474 savings). $635 profit in today's $
  5. Heat Pump Hot Water ($3,415 cost, $8,326 savings). $518 profit in today's $
  6. Reverse Cycle Heating ($8,000 cost, $16,535 savings). at the benchmark
  7. Induction Cooktop ($1,800 cost, $7,238 savings). $1,624 profit in today's $

Total investment: $42,300. Total savings: $108,700. Profit in today's dollars: $12,700.

Tasmania's cool climate and high heating demand mean insulation and draught sealing rank higher here than in any other capital. Solar pays back more slowly (lower electricity rates and less sun), but still beats the benchmark. The gas heating switch is marginal without state rebates, but it still makes the cut because completing it unlocks the gas supply charge elimination.

Canberra: ACT incentives change the game

  1. Solar + Battery ($13,352 cost, $44,124 savings). $8,796 profit in today's $
  2. EV ($6,600 cost, $35,707 savings). $12,609 profit in today's $
  3. Insulation ($1,680 cost, $6,537 savings). $1,417 profit in today's $
  4. Heat Pump Hot Water ($2,615 cost, $7,941 savings). $1,140 profit in today's $
  5. Draught Sealing ($480 cost, $2,795 savings). $908 profit in today's $
  6. Reverse Cycle Heating ($6,400 cost, $14,345 savings). $369 profit in today's $
  7. Induction Cooktop ($0 cost, $7,836 savings). $3,702 profit in today's $
  8. Home Automation ($2,000 cost, $4,323 savings). $113 profit in today's $

Total investment: $33,100. Total savings: $123,600. Profit in today's dollars: $29,100.

The ACT's Sustainable Household Scheme provides low-interest loans that reduce the effective cost of most upgrades. The EV is particularly cheap here ($6,600 vs $8,250 elsewhere) due to ACT-specific incentives. Cold winters make insulation and draught sealing more worthwhile than in warmer cities. The induction cooktop shows $0 cost because the ACT's gas-to-electric incentives fully cover it when it is the final gas switch.

Why the order matters

The key insight is that each upgrade changes the baseline for every upgrade that follows. Some examples:

Solar reduces your electricity cost, which means upgrades that add electrical load (heat pump, induction cooktop) save less per kWh after solar is installed. But solar also means some of that new load is covered by your own panels rather than the grid.

Switching off gas appliances one by one does not eliminate your gas supply charge. You only stop paying $220 to $310 a year in supply charges when the last gas appliance is replaced and the meter is disconnected. The calculator groups gas switches into a "Gas Disconnection Plan" because the value comes from doing all of them.

Insulation reduces heating and cooling load, which affects both the solar self-consumption calculation and the savings from a reverse cycle upgrade.

If you did Melbourne's upgrades in Sydney's order, you would leave money on the table because you would be optimising for solar in a city where gas switching and EVs deliver more value.

Incentive expiry is factored in

If an upgrade gets delayed (saving up for it, or waiting for your car to reach end of life), the calculator checks whether rebates will still be available at the future purchase date. Federal STC deeming years reduce annually until the scheme ends in 2030, and state programs like VIC Solar Homes have their own expiry dates. The numbers already account for this.

Run your own numbers

The figures above are for a typical 3-bedroom home. Your situation will vary depending on your postcode, energy rates, and which appliances you have. The calculator evaluates every upgrade, works out the optimal sequence, and shows you the profit-maximising plan for your home.

Where these numbers come from

Electricity and gas rates from AER monitoring reports and published retailer tariffs. Equipment costs from SolarChoice and installer surveys. STC values from the Clean Energy Regulator. State incentive details from published government programs. Full data source list on the data sources page.

Run the calculator for your home