Powering homes beyond fossil gas

VCOSS submission to the Building Electrification Regulatory Impact Statement

The Victorian Council of Social Service (VCOSS) strongly supports getting fossil gas out of homes. Electrification is the best pathway to decarbonising the residential sector, and efficient electric appliances are cheaper to run, healthier, and create fewer emissions.

Historically, Victorian households were encouraged to connect to gas and use it liberally. Often this abundance led to the use of less efficient appliances, and the building of homes that were extremely energy inefficient – that is, difficult to cool in summer and difficult to heat in winter.

Depleting gas fields, high demand, policy settings favouring export, and international market forces mean that gas is no longer a cheap source of energy for Victorians. Modern electric appliance technologies such as heat pumps are far more efficient than fossil gas alternatives. They are therefore cheaper to operate, consuming less energy for the same tasks.

It is now also clear that burning fossil gas is a key contributor to greenhouse gas emissions that drive climate change. Meanwhile, our electricity network is increasingly based on renewable energy sources. As such, getting off gas is essential to reaching our net zero targets.

There is also a growing body of evidence that burning gas in the home is damaging to health, with fugitive (unintentional) emissions linked to increased rates of asthma and respiratory illnesses, especially among children. As much as 12 per cent of all childhood asthma cases in Australia can be attributed to gas cooktops.[1]

Victoria uses more fossil gas for residential and commercial purposes than other states, accounting for two-thirds of national household and commercial consumption, and three times more than the next highest user, New South Wales. [2] In fact, Victoria is the only state where the residential use of gas is higher than industrial usage. Victoria is also the only state where fossil gas usage is higher than electricity usage in the homes.[3]

In this context, VCOSS has long supported the Victorian Government’s policy of gradual household electrification, and reversal of historic policies that encourage new gas connections.

If planned well, electrification, as with all climate policies, has the potential to address many of the drivers of inequality in our economy, such as the quality and energy efficiency performance of housing. The reverse is also true: a poorly handled transition will entrench and exacerbate existing inequalities.

Low-income households already spend a disproportionate portion of their income on energy bills. As such, any effort that assists low-income households to electrify their homes will see a significant reduction in bill stress. This is particularly true when costs for all of life’s basics are high, stretching household budgets from all angles.

The government has a crucial role to play in ensuring all Victorians can access the benefits of electrification, as some households face structural barriers to electrifying their home. This includes the upfront cost of appliances, the potential costs of rewiring homes, differing rights over modifications to properties between owner-occupiers, renters and people in apartments, the costs of goods and services in rural and regional areas, and language and digital barriers. Often those that would benefit the most from electrification are those that face the most challenging barriers.

These obstacles can be overcome only through government interventions. We cannot leave the energy transition to market forces.

In this submission, VCOSS details its support for the Victorian Government’s proposed regulatory changes and recommends:

• The Victorian Government lead the way with social housing retrofits.
• Support for low-income households to benefit from electrification.
• Phasing out gas cooktops.
• Enacting strong enforcement and compliance measures, alongside proactive community outreach.
• Planning long-term for the eventual end of fossil gas usage in the home.

Alongside the proposed building electrification requirements discussed here, VCOSS is also a strong supporter of the Victorian Government’s proposed energy efficiency minimum standards for rentals.[4] Taken together, these policies represent a significant and ambitious step forward in improving the quality, liveability, and affordability of housing in Victoria.

[1] Knibbs, L. D., Woldeyohannes, S. Marks, G. B. and Cowie, C.T. (2018), “Damp housing, gas stoves, and the burden of childhood asthma in Australia,” Medical Journal of Australia, 208: 299- 302.

[2] Infrastructure Victoria (2021) Towards 2050: Gas infrastructure in a net zero emissions economy; Department of Transport and Planning (2024) Building Electrification – Regulatory Impact Statement, p32.

[3] Department of Transport and Planning (2024) Building Electrification – Regulatory Impact Statement, p32.

[4] For the minimum standards see: Deloitte Access Economics and Department of Energy, Environment and Climate Action (2024) Minimum energy efficiency and safety standards for rental homes – Regulatory Impact Statement. For VCOSS’ response to the proposal, see: Victorian Council of Social Service (2024) VCOSS Submission on Energy Efficiency Minimum Standards for Rental Properties and Rooming Houses.