Victorian government scraps sweeping bans on gas heating while tightening rules for gas hot water systems in major policy backflip

Sky News AU

6 hours ago

Victorians using gas heating will no longer need to install electric models once the system breaks down, as the Allan government backs down on its contentious gas bans after alarm from consumers and industry magnates.
The Victorian government revealed a raft of measures in 2023 which sought to phase out the use of gas in the state, yet has since removed multiple elements of the policy.
The Allan government revealed it would allow owner-occupiers to continue using gas heating systems, while businesses can also use gas in existing commercial buildings after growing concerns that Labor intended to ban all gas appliances.
The draft plans would have forced hundreds of thousands of Victorians still reliant on gas heaters, cooktops and hot water systems to shift to electric models as part of the government's net zero emissions pathway.
The Victorian government previously carved out cooktops last year, with ducted systems and gas heaters now also exempt.
However, from March 1, 2027 hot water systems that break down will need to be replaced with efficient electrical alternatives including heat pumps yet will be subject to exemptions.
The government has claimed electric hot water systems could save the average family $330 a year, or $520 through the use of rooftop solar, and that the transition to such systems would be heavily subsidised.
As part of the back down, the Allan government also delayed all changes to energy rules, which were set to commence next year to March 2027.
Landlords will also be subject to stricter restrictions despite receiving the same exemptions as owner-occupiers, with gas hot water systems and heaters in rental properties needing to be replaced with electrical models such as reverse-cycle air conditioners.
Renters are set to receive greater protections in the reforms, with landlords having to install more efficient shower heads, ceiling installations at the start of a lease, and fitting out living rooms with electric cooling systems.
The government said the tougher rules for landlords would help struggling renters in a 'cost of living crisis'.
The changes to gas heating appliances in owner-occupier properties and exemptions for gas hot water systems is a significant win for the gas and energy industry which ardently lobbied against the suite of measures in their original state.
Industry magnates stated that if hundreds of thousands of homes were swapped over to electricity based services then the grid would be overloaded in the short term, placing the viability of the entire system at risk.
Victorian Premier Jacinta Allan said the gas bans would considerably reduce electricity bills and safeguard dwindling supply as gas reserves in the Bass Strait continue to enter critical levels.
'Families will pay less on their energy bills; industry will get the gas it needs – and Victorian jobs are protected. It's good for industry, workers, renters and families,' she said.
All new homes and commercial buildings excluding industrial, agricultural and manufacturing facilities will also need to be built completely electric from March 1, 2027.
Victorian has the highest use of residential gas in Australia, with an estimated 80 per cent of homes still connected to the gas network.