The Allan government has announced regulations and funding that pave the way for the electrification of Victoria’s buildings. This includes:

• phasing out gas hot water – from March 2027 only efficient electric hot water systems can be installed in Victorian homes. When an existing gas system reaches the end of its useful life, it will have to be replaced with an efficient electric one.
• new buildings to be all-electric – already, new houses that require a planning permit must be all-electric. From January 2027 this will extend to all residential and commercial buildings (with a few logical exceptions such as large industrial facilities).
• renters will get the right to live in efficient electric homes – from March 2027 landlords will have to begin providing decent insulation, draught-proofing, water saving showerheads, and efficient all-electric appliances for hot water, heating and air conditioning.

The Victorian Government banned gas connections for new build residential houses in July 2023.

Missing from this announcement:

• It stopped short of phasing out gas heating – the biggest gas guzzlers of all. However, the government has already created significant incentives to switch from gas to electric heating (including rebates of up to $8,000). 
• Similarly, no phase out of gas cooktops, except for new builds. Purchasing an induction cooktop will only attract a rebate of about $140 if you have an existing gas cooktop. 
• Some of the most vulnerable renters will have to wait longer for change as a decision on minimum standards for community housing has been delayed.

For those wanting to try electric induction cooking, before upgrading from a gas cooktop to a full induction cooktop, a plug-in single induction hotplate can be purchased. This one was on sale in Aldi for $49.99 in 2022.

At last Renters will see improvements

The announcement on electrification and building standards includes new regulations to require all rental homes, including Victoria’s public housing, to meet minimum standards.

These new announcements will be added to the Victorian Rental Minimum Standards and will be phased in from 2027, with everyone to be covered by 2030.

Renters across Victoria will be able to access the following mandatory standards to be phased in between 2027 and 2030:

• Draught proofing and ceiling insulation standards 
• Home cooling standards, requiring a minimum 3-star cooling rating for appliances in the main living room 
• Hot water and heating systems that reach the end of their life must be replaced with energy-efficient electric appliances. 

These standards will help renters save on energy bills, improve their health and comfort during extreme weather, and support the phase-out of polluting gas that makes heatwaves longer, hotter, and more deadly.

Running out of gas

The Bass Strait gas fields are running out of gas. This requires the use of gas in Victoria be re-arranged. Victoria has a high residential gas use due to decades of reliance on Bass Strait Gas. Much of this gas has also been sent through the gas pipeline network, and from 2015, exported as LNG from the Gladstone LNG plants.

The Victorian Government last year approved Beach Energy drilling under the 12 Apostles to bring some new gas online.

But ultimately we need to reduce gas use, as it is mostly methane which is a very strong greenhouse gas, more than 86 times stronger than Carbon Dioxide in a 20 year timeframe. So conversion of Victorian residential gas users to electric appliances will mean more gas for industrial users and gas peaker electricity turbines to allow more time for transition.

Gas is already becoming more expensive, connected to international prices. And as more residential users electrify, the gas network will enter a death spiral as there are fewer customers to support the network. Regulators are already grappling with what mechanisms to use to control the cost increases to users during the death spiral.

Both Environment Victoria and Friends of the Earth welcomed the announcement. Freja Leonard from FoE Gas campaign said in a media release:

“In a great many ways these are groundbreaking reforms for the climate and selected household budgets. We love that the nearly one third of homes occupied by renters are prioritised, meaning that some of the most vulnerable households will see an early benefit in shifting away from expensive gas to more efficient hot water, heating and cooling options”, said Friends of the Earth No More Gas campaigner Freja Leonard. “Ultimately this means an annual average bill saving of around $330 each year, jumping to about $520 annually if the home has sufficient rooftop solar.”

“We’ve said it before and we have to say it again: we urge the government to shift daily access charges for gas from renters to rental providers as currently happens for water bills. This will finally incentivise landlords to remove gas entirely from their rental properties.

“We appreciate the efforts of the Allan Government working constructively with The Greens, who helped secure funding to make today’s announcement possible, including $20m to implement the minimum rental standards and an additional package to support industry to transition to the manufacturing of efficient electrical appliances. This important addition to today’s announcement shows what can be done when different Parliamentary players put aside the political jousting to come together and work cooperatively for the benefit of all Victorians.

“Phasing out gas appliances for rentals and new homes is energy policy made sexy. It’s a triumph for energy justice, economic commonsense and climate which will benefit Victorians for decades to come.

“Ultimately we hope the Victorian Government will build on these excellent reforms to work towards the equitable, rapid and orderly retirement of the gas mains system, prioritising those most vulnerable households and businesses, and assisting them – and Victoria – to finally get off gas for good.”

Kat Lucas-Healey, Senior Climate and Energy Advisor for Environment Victoria, said in a media release:

“Upgrading all Victorian households to efficient electric hot water systems will create more than eight times as many jobs as the climate-wrecking North West Shelf gas plant that was recently approved in Western Australia.”

“Efficient electric replacements save money because gas is so expensive and gas appliances are so inefficient. It creates jobs, makes energy bills more manageable and cuts climate pollution.”

“In Nepean alone, the electorate of Sam Groth MP, electrifying hot water has the potential to create 49 new trade jobs lasting 10 years.”

In quite a stark contrast, the report in the Age highlighted that cabinet had substantially scaled back plans to support a stronger and faster transition off gas as detailed in the Updated Victorian Gas Substitution Roadmap.

Gas is 26% of Merribek Community emissions

What residential households do in phasing out gas and electrifying houses really does count. Here in Merri-bek in 2022/2023 Gas was 26 percent of total community emissions. To further break this down:

• Residential 19%
• Commercial 2%
• Industrial 5%

The 2022/2023 year, the most up to date year for data, shows that gas use in Merri-bek declined. Hopefully this has continued over the last two years and will form a trend.

Merri-bek Council has set a 2030 community target for Decreased gas use of a reduction of 25% from its 2022-23 levels.

Merri-bek Council intends to continue phasing out gas use and Electrifying Council facilities:

• Pending external grant funding, a further 2 gas-heated aquatic centres have been electrified, cutting their energy-related emissions to zero. Priority sites for electrification by 2030 include Oak Park Sports & Aquatic Centre and Brunswick Baths.
• At least 30 of Council’s remaining 44 small sites that consume gas will have been electrified through a rolling upgrade program to replace gas heating and appliances with efficient electric alternatives.

Council will also advocate to the Victorian Government for an Orderly phase-out of gas networks to ensure costs are not borne by consumers.

References

24 June 2025, Premier media release, Securing Victoria’s Gas Supply While Slashing Energy Bills https://www.premier.vic.gov.au/securing-victorias-gas-supply-while-slashing-energy-bills

25 June 2025, Energy Victoria, New electrification and efficiency standards and regulations for Victorian buildings https://www.energy.vic.gov.au/households/electric-and-efficiency-standards-for-buildings

12 March 2025, Renew Economy, Gas network death spiral: Pressure mounts to protect consumers from cost of stranded assets
https://reneweconomy.com.au/gas-network-death-spiral-pressure-mounts-to-protect-consumers-from-cost-of-stranded-assets/

25 June 2025, Energy Victoria, Securing gas supply for Victoria (Gas Security Statement) https://www.energy.vic.gov.au/businesses/gas-security-statement

24 June 2025 – The Age, Victoria scales back sweeping gas appliance bans https://www.theage.com.au/politics/victoria/victoria-scales-back-sweeping-gas-appliance-bans-20250623-p5m9pg.html

24 June 2025 – Friends of the Earth – “Energy Policy made sexy”: Victoria’s energy future is electrifying https://www.melbournefoe.org.au/_energy_policy_made_sexy_victoria_s_energy_future_is_electrifying

25 June 2025 – Environment Victoria – Switching homes from gas to electric hot water systems will create thousands of new trade jobs in Victoria https://environmentvictoria.org.au/2025/06/25/switching-homes-from-gas-to-electric-hot-water-systems-will-create-thousands-of-new-trade-jobs-in-victoria/

For details of Gas emissions in Merribek see Climate Snapshot for Merribek https://snapshotclimate.com.au/locality/municipality/australia/victoria/merri-bek/