Have you thought about what you’re going to do next time your heater, cooktop or water heater breaks down?

Here’s a tip. The choice you make could save you up to $1200 a year.

Almost three quarters of Victorian households use natural gas for cooking, heating or hot water. These appliances break down more often than you’d think – every 12 to 15 years.

Most Victorians could save money by upgrading broken gas appliances to efficient all-electric appliances, such as induction cooktops, heat-pump water heaters and reverse-cycle air-conditioners.

Unfortunately, there’s a catch. You need to find an extra $4000 to unlock these savings in full, because electric appliances cost more than gas appliances.

If you had the money, within four years you will have recouped the extra outlay and be saving on your bills every quarter. You’ll have an extra $1200 a year to help with the mortgage, groceries, maybe even a holiday.

But these days most of us have nothing extra to spend. And if you are a renter, the appliances you have are the landlord’s choice, not yours.

That’s why the Grattan Institute’s latest report recommends the Andrews and Albanese governments step in and help households to unlock these savings.

We want the federal government to put financing in place so you can spread the payments for your new electric appliances over time, just like you may have done when you bought your television or car.

We want the Victorian government to announce a future date after which all rental properties will have to have electric appliances. And the federal government should provide a tax break for landlords ahead of this date to help with the cost of making the appliance switch, and to stop rents from rising.

There’s a bonus in all of this for the environment.

To achieve the Andrews government’s target of net-zero emissions by 2045, every home in Victoria will need to have upgraded from gas to electric appliances. Because electricity is getting cleaner all the time, an all-electric house produces fewer emissions over 10 years than a house that uses gas.

Some gas companies favour “green gas” over electricity. Green gas includes biomethane (made from sewage, food waste and agricultural waste) and hydrogen (made from water using renewable electricity). But green gas is more expensive than both natural gas and electricity, and it’s likely to remain so for the foreseeable future.

Of course, there’s no point governments helping out financially if the number of homes with gas keeps growing. That’s why we’ve called for a ban on new gas connections. This would mean new homes were built with efficient, all-electric appliances and their owners would save money from the get-go.

All Victorians deserve cleaner, cheaper energy at home. Governments should help them get it. Over to you, Mr Premier.

Alison Reeve

Energy and Climate Change Deputy Program Director
Alison Reeve is the Energy and Climate Change Deputy Program Director at Grattan Institute. She has two decades of experience in climate change, clean energy policy, and technology, in the private, public, academic, and not-for-profit sectors.

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