One of the major issues in household energy use at the moment is how quickly we can, and should, wean households off gas for cooking, heating and hotwater. As at 2022, around 40% of Australian domestic energy came from gas, mostly piped through urban gas networks. Much as the industry would like to convince us otherwise, gas is a significant source of greenhouse gas emissions. It also happens to be expensive and unhealthy. This article provides a brief summary of some of the issues and possibilities around getting off gas, with a particular focus on social and affordable housing providers and tenants.
Why Get Off Gas?
There are three main reasons to convert our housing from gas to electricity.
Gas is expensive.
Since the Russian invasion of Ukraine, global gas prices have gone through the roof, and this has flowed into our domestic prices. An analysis by the Climate Council showed prices for domestic gas had increased by 80% in the year to June 2022, on the back of a longer term growth trend.
The Climate Council estimates that the average Australian household would save between $500 and $1,900 per year in an ‘all electric’ home as compared to one using gas. This variation is largely determined by location (a Perth household would save at the lower end of this estimate, one in Hobart or Canberra at the higher end) and the type of appliances installed. Variations between locations are due to differences in gas and electricity prices between States, and different climatic conditions which lead to different patterns of energy use.
Even at the lower end of these savings, this sort of money is vital for the low income households who live in social and affordable housing, for whom energy bills have increasingly become a problem in recent years. Electrifying social and affordable housing is one way to help tenants to achieve greater financial stability.
Gas is bad for our health.
Burning gas in the home, particularly via gas stoves, has been linked to increased risk of childhood asthma and other health issues. Burning gas gives off a number of harmful by-products including nitrogen dioxide and carbon monoxide.
Nitrogen Dioxide has been linked to increased incidence of childhood asthma, with about 12% of the ‘disease burden’ of childhood asthma attributed to household gas in both US and Australian studies. Its impact on adults is less well documented but it presents a risk particularly for older people and those with respiratory illness.
Carbon Monoxide is poisonous and in extreme cases can lead to unconsciousness and even death from oxygen depletion. More commonly, it will lead to headaches and tiredness.
For social housing tenants, who often suffer from poorer health than others in the community to start with, we don’t need to be putting any more risks in their way.
Gas contributes to climate change.
Finally, of course, methane gas contributes to climate change. Methane is a far more potent greenhouse gas than carbon dioxide, contributing about 80 times the amount of warming for the same amount of gas, although it degrades faster. When you burn methane it produces carbon dioxide as one of the by-products, but a substantial amount of methane also escapes via leakage, even when the stove is not in use.
You can decarbonise an electric home by using renewable energy, but you can’t decarbonise gas. All you can do is switch it off.
New gas connections are being banned in more locations.
At State/Territory level the ACT and Victoria have both announced that they are banning gas connections in new buildings, as well as putting incentives in place to encourage owners of existing homes to switch. In NSW a number of local governments have done the same through their local planning schemes. Along with this many States are starting to offer incentives for households to replace gas in existing homes. The momentum is building to transition away from gas in homes and is likely to continue over the coming few years.
What are the barriers?
So why isn’t everyone just switching off their gas and going all-electric? Well, it’s simple in theory but there is a cost.
Conversion Costs
The first reason is, of course, that conversion costs money. You need to replace gas hot water systems, heating and stoves with their electric equivalents, and these come at a cost to buy and install, especially as there is not generally wiring in place to run them from. The Climate Council reports costs of between $11,000 and $40,000 for a full conversion, depending on the size of the home, the type of appliances chosen and the complexity of the electrical changes. These costs assume homes have ducted air-conditioning which very few social housing dwellings have so a social housing refit would be likely to come in lower.
They estimate payback times (the time it takes for the saving in power bills to make up for the cost of conversion) at anywhere from 5 to 15 years. Of course, such an analysis makes sense for an owner-occupier but not for a landlord, whether social or private, because in this case the owner pays for the conversion and the tenant gets the benefit. In practice, this means that the ideal time to switch for any person or organisation who rents their home out is when the appliances need replacing anyway. Ideally you could switch all the appliances at once but realistically you may convert bit by bit as each piece of equipment reaches is replacement date, and switch off the gas when you’ve done the last one.
Disconnection Fees
The second barrier is the cost of disconnection. Reports from around Australia vary widely as to the cost. A ‘temporary disconnection’, where the gas is simply turned off at the meter, is generally fairly low-cost at around $100. However, the cost for the removal of the meter and pipes can be much higher, with Switched On reporting charges anywhere from $700 to over $2,000. It’s important to at least do a 'temporary disconnection', because otherwise the household will continue to pay a service fee (typically around $30 per month) even if they are not actually using any gas.
The Australian Energy Regulator has recently determined that Victorian households can be charged a flat fee of $220 for switching off the meter, and that the costs of removal are to be ‘socialised’ across the network by charging higher prices to all gas consumers. This decision will facilitate the Victorian Government’s plans to transition away from gas over time. However, this fee is quite generous to gas providers!
Preferences
The final thing we are contending with in making the switch from gas is that some people just like to use it, especially for cooking. There are people, including experienced chefs, who will tell you that some dishes (such as those cooked in a wok) simply don’t turn out as well when cooked using electricity. Others, equally well qualified, say it makes no difference. I’m not a skilled enough cook to have a meaningful opinion, but my thought is that if eating slightly inferior stir fry is too high a price for saving the planet, maybe we have our priorities wrong.
Getting It Done
So, with all of this, here’s my quick summary of what we need to do to get off gas.
If you’re building new housing, make it all electric from the start.
If you have existing housing that uses gas, each time a gas appliance wears out, replace it with an electric one.
If you are doing a full-scale renovation, include replacement of all the gas tech with electrics.
Don’t forget to make sure the gas is disconnected!
Simple when you say it quickly.
More information
This is a really short summary of a complex subject. The information here comes from the following sources.
A lot of information on costs and the imperative to switch to gas comes from the Climate Council’s report Switch and Save The Climate Council have a lot of other resources on switching from gas to electric, like this explainer.
The information on health impacts comes from this brief from UNSW. There’s also this ABC report of some of the same research.
The information on disconnection costs comes from Renew Economy’s Switched On site, which provides a while lot of analysis and resources for making the switch. The article on disconnection fees is here, and you can find a lot of other handy information via their home page.
Saul Griffith’s Rewiring Australia also has a lot of ideas and insights about making the transition – check it out here.
Renew has done a series of videos on Getting Off Gas - check them out on their Youtube channel.
The Victorian Government's Gas Substitution Roadmap is here.
Check out the follow-up story on how the gas got disconnected in Esperance, WA.
I haven’t come across any resources about this specifically directed at social housing operators or indeed rental investors in general. The arguments about investing now to save costs later fall apart in a rental situation, and no organisations that I know are exactly flush with spare cash.
Has anyone out there had experience of doing this in your housing that you’d like to share with readers? If so, get in touch using the contact widget at the bottom of the page.
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