Victorian renters face gas bill rises; what it means for costs
Gas network charges may climb as households electrify, and new Victorian rental standards from March 2027 change what happens when gas appliances fail.
Victorian gas network charges could rise sharply over the next several years, and renters have the least power to avoid them. For owners and landlords, the practical response is to plan the switch to electric before an appliance fails. We cover what was reported and what the replacements cost.
What was reported
According to Energy Matters, analysts at the Institute for Energy Economics and Financial Analysis (IEEFA) estimate Victorian gas network charges could increase by 23% to 49% by 2033 under one scenario. That scenario assumes networks get to set their own accelerated depreciation allowances, which the Australian Energy Market Commission is considering rule changes on.
The logic is simple. The pipes cost the same to maintain whether 100 or 50 households use them. As more homeowners switch to electric appliances, the fixed network cost is spread across fewer customers. Renters often can't make that switch, because the heater, hot water system and connection belong to the landlord.
Energy Matters also reports that Victoria's new minimum energy efficiency standards for rentals start on 1 March 2027. A working gas heater won't have to be removed, but once it fails for good it can't be replaced with another gas one. The report cites Victorian Government estimates of savings of up to $215 a year from replacing a dead gas heater with a reverse-cycle air conditioner, and up to $220 a year from moving from gas hot water to a heat pump.
One caution from the report: the networks' own warnings about price rises were based on unpublished pricing proposals, so treat the figures as a scenario, not a forecast.
What it means for landlords and owners
If you own a rental in Victoria, a failed gas heater or hot water system after March 2027 means an electric replacement. Replacing ageing appliances on your own timetable lets you compare quotes instead of paying for a rushed job in the middle of winter.
If you own your home, the same logic applies to your own bills. A large daily supply charge means you pay for being connected whether you use gas or not.
What the replacements cost
Our figures include GST and come from our cost model: labour hours × local rates plus materials, checked against market prices and real quotes.
- Heat pump hot water (270 L): typically $4,500, with a usual range of $3,500 – $5,850. See our [heat pump hot water guide](Heat pump hot water). Prices are usually quoted after STCs, a federal discount that steps down each year until the scheme ends in 2030, so waiting can cost you.
- Split system air conditioning (3 rooms): typically $9,000, with a usual range of $7,000 – $11,700. Our [air conditioning guide](Split system air conditioning) covers sizing and what changes the price.
- Like-for-like hot water swap: if you are replacing a unit rather than switching fuel, a standard replacement is typically $2,100. See the [hot water system replacement guide](Hot water system replacement).
A switch can add electrical work, such as a new circuit. That work, like plumbing, must be done by licensed tradespeople. In Victoria, electrical work is also reported through a Certificate of Electrical Safety lodged with Energy Safe Victoria, which only registered licence holders can buy and lodge.
Practical steps
- Check the age of every gas appliance. Energy Matters suggests anything over about 10 years old is a candidate for planned replacement.
- Look at your daily supply charge on the bill to see how much of your cost is fixed.
- Renters: ask your landlord in writing about replacing gas appliances before they fail, and report any breakdown in writing straight away.
- Landlords: get two or three quotes now and compare the total cost after STCs.
Before you sign, run any quote through our quote checker (the "is my quote fair" tool). It shows whether the price sits inside the range we'd expect for the job and where a quote looks high.
The bottom line
The 23% to 49% figure is one scenario, not a certainty. But as more households leave the network, fixed gas charges are likely to fall on those who remain. For most Victorian owners and landlords, an electric replacement is a cost they will face sooner or later, and a planned job is almost always cheaper than an emergency one.