Victoria bans new gas connections from 2024, but are households actually electric keen?

Cooking and heating with gas could soon be a thing of the past in Victoria, after the state government took a controversial step in its latest zero emissions roadmap and banned new connections to the gas network.

From January 1, 2024, new build households in Victoria will be unable to apply for a gas connection at their property and must be all-electric for their appliances including stovetops, heaters and hot water systems.

The ban will apply to all new homes and residential subdivisions that require a planning permit, as well as apartment complexes and public and social housing developments.

All new government buildings, including schools and hospitals will also be all-electric if constructed after this time.

The ban does not currently apply to Victorian households that already have a gas connection. These customers remain unaffected in their gas usage for the time being, although there is the potential that this may change in future.

Why is Victoria banning new gas connections?

The Victorian Government claims that switching to all-electric can help households and businesses to reduce their carbon emissions and energy costs in the long-term.

According to the state government, about 17% of the state’s net greenhouse emissions are generated by the gas sector and at least 80% of households in the state use the energy source.

The move to ditch gas is a key component to helping Victoria meet its emissions reductions target of 75% to 80% by 2035 and net zero by 2045.

Energy and Resources Minister Lily D’Ambrosio told the ABC that switching to all-electric could also help Victorian households to save up to $2,200 a year on their energy bills.

“Going all electric will save a new home owner $1,000 off their energy bills each and every year and if they’ve got solar panels, it’ll save them $2,200,” she said.

The government also calculated that converting an existing home to all-electric could save families about $1,250 each year, with an additional saving of $950 if the house already has a solar system installed. Households who then add a battery could see a further $520 tacked onto these savings.

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Are Victorian households actually keen to go all-electric?

Victoria has the highest number of gas-users of all the states and territories in Australia, with over two million users across its homes and businesses.

So, it may be unsurprising that the vast majority of households currently have no ambitions to ditch gas use.

In a Canstar Blue survey conducted during May 2023, more than half (55%) of Victorians who had gas-powered appliances in their home said they would prefer to stay with gas, even if given the opportunity to transition to electric in the next two years.

Only 15% of Victorian respondents had said they had been gradually transitioning from gas to electric appliances over the past two years.

Of those that said they had transitioned in Victoria however, saving money on energy costs appeared to be the largest motivator for switching (42%), followed by environmental concerns (24%) and the fear that gas use would eventually be phased out (22%).

Nearly one in three (30%) Victorian households also believed that using a combination of electricity and gas in the home made their energy costs cheaper, the same Canstar Blue survey found.

Similar sentiments were recorded for the other states and territories with 74% of Western Australians saying they would also prefer to stay with gas appliances, followed by 67% of households in New South Wales, 65% of South Australians and 60% of Tasmanians.

Are other states and territories likely to follow Victoria with gas bans?

The Victorian Government is not the first to make an announcement of this kind, with similar bans already coming into effect this year for certain property types in the Australian Capital Territory.

While the likelihood of some states and territories following suit remains up in the air, New South Wales Premier Chris Minns told Ben Fordham at 2GB that his state wouldn’t be pursuing a gas connection ban.

Mr Minns stated that the gas challenges faced by NSW and Victoria were vastly different, and that NSW’s greenhouse gas emissions from gas use (7%) were less than half of that experienced in Victoria (17%).

Mr Minns was not the only industry spectator to comment on the move in Victoria however, with Energy Networks Australia, a national body that represents Australia’s electricity and gas distribution networks, voicing concerns of a premature decision.

Energy Networks Australia CEO Dominique van den Berg said it was a complex issue that held many moving parts.

“It is critical to carefully consider, with the benefit of all stakeholder perspectives, the whole of energy system implications of significant policy decisions, including impacts on costs, emissions and the most vulnerable,” she said.

“We stand ready to participate in open dialogue and consultation, offering our expertise and perspective to help shape a balanced, sustainable energy future for Victoria and Australia more broadly.”

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