Victoria to phase out gas in new homes from 2024 [Update]
The Australian state of Victoria has made a decision to phase out gas in new homes, aiming to make energy more affordable, reduce household emissions, and address uncertainties around rising gas costs and supply, it announced on July 28.
Starting from January 1, 2024, all new homes and residential subdivisions seeking planning permits will only be connected to all-electric networks.
According to the government, by going all-electric, new Victorian households can save up to A$1,000 ($688) off their annual energy bills, and those with solar installations can save up to A$2,200. The changes will also apply to new public buildings that are yet to reach the design stage, including schools, hospitals, police stations, and government-owned buildings.
“Reducing our reliance on gas is critical to meeting our ambitious emission reduction target of net zero by 2045 and getting more Victorians on more efficient electric appliances which will save them money on their bills,” minister for energy and resources Lily D’Ambrosio said.
Victoria currently has the highest use of residential gas in Australia, and the gas sector contributes approximately 17% of the state's emissions. Transitioning to electric systems is a crucial step towards meeting the state's ambitious emissions reduction targets of 75–80% by 2035 and achieving net zero emissions by 2045, the state government said.
To ensure homeowners can benefit from renewable energy, the government is investing A$10mn in a residential electrification grants programme. These grants will provide bulk rebates for solar panels, solar hot water, and heat pumps to new home buyers, amounting to savings of A$4,600 upfront.
Additionally, the government is investing A$1mn in targeted training to support the construction industry's transition to all-electric and 7-star homes.
Australia's peak oil and gas industry body Appea said the Victorian government’s gas ban for new homes ignores the fundamentals of the energy system transformation to net zero including the importance of gas as a partner to renewables in reliable electricity generation.
Appea said the government’s policy shifts the burden onto consumers, pushing households onto an already strained coal-based electricity grid and ignoring the urgent need for new local gas supply to reduce emissions and put downward pressure on prices.
“With more than 60% of Victoria’s electricity coming from coal, the focus should be on reducing emissions from the power sector, through renewable energy and firming gas power deployment, before adding to power demand," Appea CEO Samantha McCulloch said.
“The Victorian Government is taking choice away from consumers for limited climate benefit while ignoring the fact that the best way to bring gas prices down is to invest in more gas supply," she added.
(Update adds comments from Appea)