State extends subsidy to ceiling insulation to help more households slash their energy bills

The Victorian Labor government has expanded its highly successful energy upgrades program to include ceiling insulation, offering discounts that cover up to half the cost of an average installation.

Almost 60 per cent of Victorian homes reportedly have little or no ceiling insulation, leaving households having to pay more to stay warm in winter and cool in summer.

Building on the success of its Victorian Energy Upgrades (VEU) scheme, the state Labor government announced late last week that it would expand the program to include a discount on the cost of installing ceiling insulation.

The VEU has primarily focused on technological solutions to increase a home’s energy efficiency – solar and batteries, electric heating and hot water pumps, and reverse cycle air conditioners.

With the introduction of a discount for ceiling insulation, the Labor government is continuing to ramp up the pressure on the opposition Liberal government, who voted last year against extending the VEU program to 2045.

The new VEU discount will cover up to $1,500 in metropolitan Melbourne and up to $2,100 in regional Victoria of the cost of installing ceiling insulation. And with an average installation costing around $3,000 for the average Melbourne home, that means the discount could save up to half on the average total cost.

In turn, improved ceiling insulation could help Victorians dramatically reduce their energy bills.

“We’re cutting up to half the cost of ceiling insulation – helping families stay warmer in winter, cooler in summer and save more than $400 a year,” said Jaclyn Symes, state minister for energy and resources.

“Insulation is a simple upgrade that can make a big difference to your power bill, and we’ve worked with unions and industry to make sure it’s done safely.

“Jess Wilson’s Liberals voted against energy-saving discounts for families and want to scrap the energy projects bringing bills down – their plan means higher power bills for Victorians.”

The statewide expansion of the VEU to include ceiling insulation follows a first phase of the program that was rolled out in April 2026 for public and community housing. The original expansion was part of $51.4 million in joint funding from the federal and state governments to bolster the Energy Efficiency Social Housing Program (EESHP).

Then, as now, every upgrade must be carried out by an accredited provider using installers that have been certified by the Energy Efficiency Council and complemented with mandatory electrical safety and installer assessments completed before work begins.

This is, at least in part, an effort to combat concerns raised that the new ceiling insulation discount program could become a repeat of the so-called “pink batts” scheme, a one-time federal Labor insulation incentive that was found to have contributed to the accidental deaths of four young and inexperienced workers within the space of a year.

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