Understanding the Australian Energy Star Rating System

We’ve all heard something vague about how buying the most energy efficient appliances will help to protect the environment and our back pockets. But what do energy star ratings mean? And is an appliance with a higher energy star rating really going to save you money in the long-run?

As the cost of electricity seemingly rises higher and higher, the energy efficiency of your appliances remains one of the biggest factors in determining the size of your monthly bill. Having one inefficient appliance may not seem like a big deal, but what happens when you have a household full of them?  Appliance energy star ratings exist to help you choose the most efficient products on the market, but what do they all mean, and should you be paying closer attention to them? Find out everything you need to know about energy star ratings with this Canstar Blue guide.


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What are the energy star ratings?

Energy Star Rating Labels

Energy star ratings are a Federal Government initiative designed to help consumers ascertain an appliance’s energy efficiency by displaying an energy rating on a six or 10-star scale, as well as the appliance’s annual energy consumption. First introduced in 1986, the energy star ratings are now mandatory for a number of household appliances, including dishwashers, washing machines, fridges and TVs.

Energy star ratings can come in whole or half star increments, with their energy efficiency determined by the energy service per unit of energy consumption – the lower the energy consumption per unit of energy service the higher the star rating. Generally you’ll see the standard six-star rating label, but those appliances labelled as ‘super-efficient’ will showcase a 10-star label.

  • It’s worth noting that certain appliances such as three-phase air conditioners can carry energy star rating labels, but aren’t currently required to.

Is a six-star energy rating the best?

When the energy star rating labels were first introduced, the highest efficiency rating an appliance could get was six stars. In recent years though, the ratings have been expanded, with ‘super-efficient’ appliances now scoring between seven and 10 stars. These super-efficient appliances have a slightly different label, and are worth keeping an eye out for if you’re after the most efficient appliances for your house.

Air conditioning energy star ratings explained

In your journey to find an efficient appliance, you may find that air conditioners have a blue and red energy star rating label, but what exactly do they mean? The blue energy star labels indicate how efficient the model is at cooling, while the red energy star label indicates how efficient the air conditioner is when you put the heating settings on. The energy star rating labels on air conditioners still work the same as other appliances, but as an air conditioner has multiple functions, it needs more labels to indicate its full efficiency to ensure that you aren’t chilled to the bone when you open your energy bill.

How are energy star ratings calculated?

The energy star ratings are determined by the size of the product and its energy consumption levels, with products compared to similarly-sized alternatives. This information is then run through algorithms and standards set down by the Australian Greenhouse and Energy Minimum Standard Regulator (GEMS), which was established in 2012 to create nationwide standards.

Do energy efficient appliances save you money?

An appliance with a high energy star rating indicates that it does its job efficiently, meaning that it can generally run at a cheaper price than an appliance with a lower efficiency rating. But whether that means that it will save you money isn’t as clear cut, as more than just the running cost goes into the bottom line.

Efficient appliances may save you money over the long run through cheaper electricity bills, but generally come with a higher initial cost, meaning it’s generally a trade-off as to whether you want to save money upfront by purchasing a less-efficient appliance, or save money in the long-run with a more efficient product. Take the below example from the Energy Rating Government website, which compares two 420L fridges:

  • Model 1 has a 2.5-star energy rating, costs $1,299 to purchase and uses 468kW of energy per annum, with an approximate running cost of $117 per year.
  • Model 2 has a 4-star energy rating, costs $1,377 to purchase and uses 328kW of energy per annum, with an approximate running cost of $79.50 per year.

Although Model 1 may save you $78 in terms of initial purchase cost, over a year it will cost you around $37.50 more in running costs. If you go with Model 2, you will have made your money back after three years, and assuming that your fridge lasts for the average lifespan of 14 years, you stand to save over $400 in terms of running costs and electricity bills over that period.

Keep in mind this is a rough estimate, and the efficiency of every appliance will vary, as will the price each individual pays for power. However, it does demonstrate that there are savings to be had by purchasing more energy efficient appliances.

Should I pay attention to energy star rating labels?

oven shopping

If you’re in the market for a new appliance, there’s always plenty to consider, from the range of features, physical size and even the colour scheme. But while some of us may focus on the price tag, it’s important to factor in the running costs to see if you’re getting the best deal possible, as while a cheaper appliance may initially seem like the better option, it could be costing you down the line.

As a result, looking at the information listed on the energy star rating label (provided the appliance is required to have one) can help you make a more informed decision as to the total cost of the appliance, and what you can expect from your energy bills as time goes on.

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