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What is the Gas Substitution Roadmap?

The Gas Substitution Roadmap is helping our state navigate the path to net zero emissions while cutting energy bills and ensuring reliability.

The roadmap outlines how we drive down bills and cut carbon emissions using:

  • energy efficiency
  • electrification
  • renewable hydrogen
  • biomethane.

The roadmap will help empower Victorian households and businesses to embrace sustainable alternatives to fossil gas and enhance access to an affordable, secure, reliable and safe energy supply.

Our Gas Substitution Roadmap update provides important information about the progress made since the release of the first roadmap in 2022.

Why do we need to move away from fossil gas?

Over 2 million Victorians use gas in their homes and businesses – more than any other state or territory

The Victorian gas sector contributes to around 16% of our state’s net greenhouse gas emissions and must play its part in reducing emissions over time.

And while our state has been a consistent producer and net gas exporter, helping to meet the needs of Victorians and Australians in east coast gas markets, moving away from fossil gas is a key part of our renewable energy future.

This must be balanced with the need for reliable, safe, affordable energy.

Going more electric in our homes not only takes the pressure off gas demand it also limits consumers’ exposure to international prices.

Going all-electric also helps Victorians save money. Going all-electric puts around $880 per year back in the pockets of new-homeowners, or approximately $1,820 per year with solar installed, while converting an existing home with solar panels from gas to electricity can save around $2,000 a year on energy bills. This is in addition to around $740 of savings per year from an existing 6.6 kW solar system.

What are the key reforms related to the Gas Substitution Roadmap – and how does this affect me?

  • Measures already in place to drive rapid electrification for homes and businesses:
    • in July 2023, the Australian Energy Regulator capped gas abolishment fees at $220 (ex GST), further lowering the cost of going all-electric
    • from July 2023 all new government buildings are to be built all-electric, including new schools and hospitals
    • new homes requiring a planning permit will be required to be all-electric from 1 January 2024
    • mandatory 7-star efficiency standards for new home construction from May 2024
    • from April 2024, the government prohibited Victorian gas distribution businesses from offering inducements to connect to gas or purchase and install gas appliances
    • from 1 January 2025, customers will pay full up-front costs of a new gas connection instead of the cost being shared by all gas-users under the updated the Gas Distribution Code of Practice published by Essential Services Commission . This brings gas in line with the current practice for new electricity and water connections
    • expansion of the VEU program to include induction cooktops.
  • Supporting reforms:
    • development of renewable gas sector in Victoria
    • focus on a responsible and balanced approach to maintaining adequate fossil gas supplies
    • build industry skills and capacity.

Proposed reforms include:

This RIS was released in December 2024. The RIS investigates options to progressively electrify all new residential and many new commercial buildings, along with the requirement for existing gas appliances in homes and relevant commercial buildings be replaced with efficient electric appliances at end-of-life.

Gas cooktops in existing homes, as well as gas appliances in existing commercial buildings, are excluded from the preferred option in the RIS.

To read more, visit:

Biomethane and renewable hydrogen will be critical to transitioning away from fossil gas. These renewable gases will be required for many industrial gas users and for gas-powered generation of electricity, which provides support for the electricity grid.

Over the past 18 months, the Victorian Government has worked closely with industry and the community through a rigorous policy development and consultation process to explore options for scaling up Victoria’s renewable gas sector.

Building on Victoria’s Renewable Gas Consultation Paper released in 2023 and stakeholder feedback, the government released Victoria’s Industrial Renewable Gas Guarantee - Directions Paper on 9 December 2024, which outlines the government’s preferred policy direction.

To read more, visit Industrial Renewable Gas Guarantee Directions Paper.

The Victorian Government is improving minimum energy efficiency standards for rental homes, driving down power bills for renters and keeping their homes warm in winter and cool in summer while cutting emissions.

Building on health and safety standards introduced in 2021 and a heating standard in 2023, proposed efficiency standards include ceiling insulation, draught sealing, hot water, heating and cooling.

A Regulatory Impact Statement and draft regulations were released for public consultation in June 2024 and the government is currently considering feedback, including potential areas of overlap with the Building Electrification RIS.

A decision on both regulatory impact statements will be made following the consultation process for the Building Electrification RIS in 2025.

To read more, visit Energy efficiency for rental properties in Victoria.

What consultation has been undertaken as part of the Gas Substitution Roadmap?

The Victorian Government continues to engage with stakeholders across the energy, manufacturing, business, building and construction sectors, installing trades, local government, environment and consumer groups during the gas sector’s transition to net zero emissions.

Feedback to date has included:

Page last updated: 13/12/24