With the Victorian Government moving to ban gas in new builds, the future of housing is all-electric. Here’s what that means for families ready to switch today.
Across Victoria, more households are saying goodbye to gas and embracing the future of all-electric living. Rising gas prices, growing health concerns, and the urgent need to reduce emissions are prompting both governments and consumers to reassess how we power our homes.
“From January 2027, all new homes and commercial buildings must be built all-electric, including commercial kitchens.” (source)
With efficient technologies like reverse-cycle air conditioning systems, heat pump hot water systems, and induction cooking now widely available, and supported by incentives, discounts, and subsidies, it’s easier than ever to make the switch.
The result? Homes that are healthier, cheaper to run, and far better for the environment.
The Victorian Government has confirmed that from 1 January 2027, all new homes and residential subdivisions will be built without gas connections. This policy is part of the state’s Gas Substitution Roadmap, which aims to:
Why the change?
Rising gas prices: Households are paying more each year as wholesale gas costs increase, while electric appliances like reverse-cycle air conditioners and heat pump hot water systems are becoming cheaper and more efficient.
Climate commitments: Gas is a fossil fuel, and phasing it out is essential for Victoria to meet its emissions reduction targets. As the electricity grid becomes cleaner, every electric home contributes to lower carbon pollution.
Health and safety: Removing gas appliances eliminates indoor pollutants such as nitrogen dioxide, which are linked to respiratory problems.
Future-proof homes: From 2027, new builds will be designed with all-electric systems as the standard. This will include heating and cooling systems, hot water, and cooking.
Lower running costs: New homeowners can expect to save significantly on bills by avoiding gas, especially when paired with rooftop solar.
Market signal: For existing households, this policy underlines the long-term direction; gas appliances are on the way out, and electrification is where incentives and innovation will focus.
No. The 2027 requirement only applies to new homes and residential subdivisions. Existing homes won’t be forced to disconnect from gas. However, the policy sends a clear signal: gas is on its way out.
No. Here’s what you need to know:
Since 1 January 2024, any new home or residential subdivision requiring a planning permit must already be all-electric.
From 1 January 2027, the requirement expands to include all new homes, commercial buildings (excluding industrial or agricultural), and even smaller secondary dwellings.
For existing homes, as of 1 March 2027, gas hot water systems reaching the end of their life must be replaced with electric alternatives, such as heat pumps. However, there’s no requirement to replace gas cooktops or space heaters.
The reforms were, in some instances, scaled back, such as the removal of mandatory replacement for gas cooking or heating in existing owner‑occupier homes, but the core timeline remains intact.
For new homes (2027 onwards):
Studies by Environment Victoria estimate annual energy bill savings of about $1,500 per household (source), doubling to $3,000 when solar and batteries are added.
“Going all-electric puts around $880 per year back in the pockets of new-homeowners, or approximately $1,820 with solar installed. A new Victorian detached home which has been built all-electric, will spend around $2,070 on energy bills compared to a new dual-fuel home which will spend around $2,950 on energy bills.”
| Scope of electrification | Avg. annual saving/per household | 10-yr statewide savings |
|---|---|---|
| New homes only | ~$719 | ~$2.3b |
| Plus existing homes (no cooktops) | ~$945 | ~$5.6b |
| Full residential | ~$1,326 | ~$6.3b (to ~$39.5b by 2050) |
| With solar & batteries | $1,500–$3,000 | — |
| All values AUD; indicative averages from 2025 studies. | ||
Switching away from gas doesn’t have to happen all at once. Many Victorian households upgrade one system at a time as appliances reach the end of their life. Here’s a simple roadmap:
Replace ducted gas or space heaters with a reverse-cycle split system. These systems heat and cool your home with up to 60% less energy and are eligible for incentives under the Victorian Energy Upgrades (VEU) program.
👉 Learn more: Victorian Energy Upgrades – Heating and Cooling
Replace your gas storage or instantaneous system with a heat pump hot water system. These use ambient air to heat water efficiently, even in winter. Incentives are available through the VEU program.
👉 Learn more: Hot Water Rebate
Move from gas cooktops to induction cooking. It’s faster, safer, and cleaner, with no open flames or indoor pollutants.
While induction incentives are limited, costs are falling, and efficiency benefits are long-term.
Offset electricity use with rooftop solar and increase independence with a battery. Solar cuts daytime running costs for air conditioning, hot water, and cooking.
There are significant incentives available through Solar Victoria for both solar PV and batteries.
If you’re a Victorian homeowner, the shift away from gas isn’t just about future policy; it’s about what you can gain right now. Replacing outdated gas systems with efficient electric appliances means:
With Victoria phasing out gas in new homes, upgrading now ensures your home is aligned with the direction of the market and government incentives. And, we’ve mentioned before, how upgrading your energy efficiency and optimising your home increases its financial value in the marketplace.
At Energy Makeovers, we make the transition simple.
Electrify your hot water heating
Gas to Electric Heat Pump Hot Water System Upgrades Available with Incentives
Upgrade Your Air Con & Ditch Gas Heating
Split-System Air-Conditioning Incentive Available
Victorian households that go all-electric save around $1,500 every year on energy bills, and those who add solar and a battery can save closer to $3,000 annually. That’s money you could keep in your pocket instead of paying to run old gas systems.
With incentives through the VEU program and Solar Victoria, thousands of dollars in upfront costs can be covered. And because Victoria’s electricity grid is getting cleaner every year, every upgrade you make today locks in lower bills and cuts your household emissions for good.
Most importantly, the sooner you switch, the sooner you start enjoying those savings.
👉 Ready to start saving?
Check your eligibility today with Energy Makeovers and see how much you could save by upgrading to efficient, all-electric systems. Our team handles everything from removing old gas appliances to installing high-performance electric solutions, so you can transition to a healthier, more affordable, and future-proof home without the hassle.
Upgrade your system with confidence. Energy Makeovers offers the Victorian Air Conditioner Discount on trusted brands like Mitsubishi and Panasonic.
*We aim to keep this post as up-to-date as possible. As questions come in from our customers and regulations change through the VEU, we will update this post to include that information. This has been updated to reflect discounts for 2026.
Updates to the regulations and compliance procedures through the VEU program in 2025.
You have the right to opt out of receiving marketing communications from us at any time and your personal information will be handled in accordance with Energy Makeovers' Privacy Policy.
