Mixed messages on gas switch

Leading energy experts say electrifying Australia’s homes could be expensive and complicated but should help reduce power bills.

Fully electrifying a person’s home – including by purchasing electric vehicles – could cost about $100,000. Picture: Thinkstock

Leading energy experts say electrifying Australia’s homes could be expensive and complicated but should help reduce power bills, as the Greens push for taxpayer-funded grants and loan subsidies to be considered as part of an ­uncosted deal with the Albanese government.

Labor has agreed to work with the Greens on a package that will offer households financial incentives to switch from gas to electricity, in exchange for the Greens’ support on the government’s ­energy price relief plan that passed federal parliament on Thursday.

The electrification deal was savaged by Seeley, one of Australia’s largest gas heating appliance manufacturers, which warned it would “drive up emissions and drive up the cost of electricity”.

Greens leader Adam Bandt said all mechanisms to deliver the household assistance should be considered as the package – which he wants targeted at renters, public housing residents and low and middle-income earners – is drafted. He would not specify what constitutes a middle-income earner.

“During the election we called for grants and loan subsidies to be given to households and small businesses to help people electrify and put things like batteries into their household so that everyone can enjoy the savings of the energy revolution. They’re the kind of things that need to be put on the table,” Mr Bandt said.

The director of the Grattan ­Institute’s energy program, Tony Wood, said it was fascinating the Greens had agreed to a deal “as vague as all hell” but he supported the overall objective of electrifying homes.

“Of course, we need to begin the move from gas to electricity, but it could be expensive,” he said.

“But you’re going to save money on the energy and that will pay off the cost of appliances and you’re getting emissions reduction for free.”

Amid estimates that fully electrifying a person’s home – including by purchasing electric vehicles – could cost about $100,000, Seeley International managing director Jon Seeley said the transition must be undertaken carefully and responsibly.

“Our political leaders should be honest about that scenario, ­instead of using their ideology to shield the truth. Less gas to heat our homes and cook our meals, equals more coal required to keep the lights on,” he said.

“There is no question this transformation from fossil fuels is required to meet our climate ambitions. But the transition from natural gas should be undertaken carefully and responsibly. Even proponents of full electrification acknowledge that our grid requires tens of billions of dollars of investment over many years before it could possibly cope with all the additional demand from switching off gas.”

Tennant Reed, Ai Group’s head of climate, energy and environment policy, said many Australians would struggle to electrify their homes because the range of appliances was limited, their quality varied and tradies often weren’t familiar with the products. Some people were also asked to pay up to $3000 to disconnect from gas.

“Actually making the transition from gas to electricity work is going to involve uncomfortable questions about not just who pays for upgrading homes but who pays for the networks,” Mr Reed said.

“What is going to happen to the gas networks and what will need to be done to the electricity networks so they can ensure they meet the new loads they have?”