Replacing gas appliances to cost Victorian households thousands

Victorian households will have to fork out the big bucks to switch off gas and move to fully electric homes.

The Andrews government is being called on to follow the ACT and provide zero or low interest loans for Victorian households to switch to fully electric homes as part of its gas substitution roadmap to lower the state’s emissions and save on energy bills.

Climate Council analysis provided to the Herald Sun estimates the cost of replacing gas appliances for electric varies from $6700-$12,900 but the savings on electric bills for an average home would be up to $1000 per year – meaning, with government rebates, it would take 7 to 13 years to recoup the new appliance outlay.

“We calculated the yearly bill savings for cooking, heating and hot water use where Victorian homeowners replace gas appliances with more efficient electric alternatives – that is induction cooktops, heat pump or solar hot water, and reverse cycle airconditioning – and found that residents in an average-sized home in Melbourne could save between $737 and $1001 on their power bills per year,” Climate Council senior researcher Dr Carl Tidemann said.

The Andrews government is being called on to provide zero or low interest loans for Victorian households to switch to fully electric homes.

Factoring in installation, gas removal and potential wiring and metering upgrades, replacement would take 9 to 13 years to pay back through bill savings but the time frame could be cut by another two years when government incentives are applied, the CC analysis found.

The figures challenge government modelling in the roadmap that cites an average $15,500 cost for households to de-gas and move to electric only and analysis by Frontier Economics, commissioned by the Gas Appliance Manufacturers Association of Australia, that estimates the cost of switching between $21,555 and $41,430 per dwelling, depending on type and size of the home and the appliances used.

Under the roadmap, the government offers incentives through its Victorian Energy Upgrades program of $2600 to replace ducted-gas heating and cooling with electric, $300 rebates to replace gas hot water systems with heat pump systems and zero-interest $1400 loans for solar.

The Gas Substitution Roadmap, which sees government incentives for residential gas products phased out by late 2023, encourages all new Victorian homes to be powered only by electricity, while existing dual-fuel gas/electric households are offered new appliance rebates to switch from gas when appliances reach their end of life or renovations are undertaken.

The ACT government’s Sustainable Household Scheme provides eligible homeowners 10-year, zero-interest loans up to $15,000 for solar, battery and electric appliances to reduce carbon emissions.