Reading time: ~5 minutes | Victoria only | General information only
Winter is coming. And if you’re still running a gas ducted heating system, this is the year to seriously think about making the switch to electric before the cold hits and energy bills go through the roof.
The good news? The Victorian Government is making it easier than ever, with up to $7,200 in discounts applied upfront at the point of sale. No paperwork. No waiting. Just a lower bill on installation day.
Here’s everything you need to know.
Why Are So Many Victorians Switching from Gas to Electric?
It’s not just about saving money, although that’s a big part of it. There’s a bigger picture happening right across Victoria.
The state government is actively legislating gas out of residential homes. New gas connections are already banned in new builds from 2027, and from March 2027, gas appliances that fail cannot be repaired. They must be replaced with electric. That means if your gas heater breaks down after that date, you won’t have a choice anyway.
The Victorians who switch now are the ones who get to do it on their own terms, at a heavily discounted price, and before winter puts pressure on installation wait times.
What Does It Actually Cost to Stay on Gas?
This is where it gets eye opening.
The average Victorian household running gas ducted heating is spending somewhere between $2,100 and $3,400 a year just on heating. Over 10 years, that’s potentially $34,000 in running costs alone, and that’s before you factor in rising gas prices, which have been climbing steadily for years.
Now compare that to a modern reverse cycle split system. Running costs drop to around $900 a year. Over 10 years, that’s a saving of more than $12,000 in energy bills alone.
And here’s the kicker: a reverse cycle system gives you heating AND cooling in one unit. Your gas heater only heats. So you’re also getting rid of the need for a separate air conditioner.
What Rebates Are Available Right Now in Victoria?
This is where it gets really interesting for Melbourne homeowners.
Through the Victorian Energy Upgrades (VEU) Program, eligible homeowners can access up to $7,200 in government discounts when replacing their gas ducted heating with a reverse cycle system. That discount is applied upfront by your certified installer at the point of sale. You don’t claim anything. You don’t wait for a cheque. It just comes straight off the price.
After the VEU discount, pricing for installed systems currently sits at:
- 3 head multi split (ideal for 2 to 3 bedroom homes): from $2,499 installed
- 4 head multi split (ideal for 3 to 4 bedroom homes): from $3,399 installed
- 5 head multi split (ideal for 4 to 5 bedroom homes): from $4,499 installed
What About Hot Water?
Victorian homeowners can also access separate rebates for replacing gas hot water systems with energy efficient heat pumps. If you’re switching your heating, it’s worth looking at your hot water at the same time and potentially doubling your savings.
Why You Should Do It Before Winter, Not After
Here’s the thing most people don’t think about until it’s too late.
Everyone waits until their gas heater breaks down in the middle of winter to start thinking about a replacement. By that point, certified installers are booked out for weeks, you’re scrambling to make a decision under pressure, and you’re sitting in a cold house in the meantime.
Getting in now, before the winter rush, means:
- Faster installation with less wait time
- You’re warm and sorted before the cold snap hits
- You have time to compare options without pressure
- You lock in the current rebate amounts before any changes
The VEU program has been extended to 2045, so the rebates aren’t going anywhere. But installer availability tightens every single year as more Victorians make the switch.
How Much Could You Actually Save?
Every home is different. The size of your property, how many rooms you need to heat and cool, your current system and your usage habits all affect the final number.
The average Melbourne homeowner switching through the VEU program is saving around $1,800 a year on their energy bills. But for larger homes or heavy gas users, that number can be significantly higher.
The best way to get a real figure for your home is to chat to a specialist who can look at your specific situation and work out exactly what you stand to save. The team at AC Hot Water Rebate can do exactly that. Check your eligibility and get a free quote at achotwaterrebate.com.au. It takes 60 seconds to check if you qualify, and a certified installer will be in touch within 24 hours.
What’s the Process?
It’s a lot simpler than most people expect.
Check your eligibility at achotwaterrebate.com.au. Fill in a quick 60 second form with your postcode, current heating system type, and a rough idea of how many rooms need heating and cooling.
From there, a certified VEU installer will contact you within 24 hours to arrange a free in home quote. No obligation, no pressure.
If you go ahead, the government discount is applied directly by your installer on the day. You pay the discounted price. Done.
Is It Worth It?
Let’s put it simply. You’re going to have to make this switch eventually. The Victorian Government has made that clear. The only question is whether you do it now, at a heavily discounted price with a system you choose, or later when your gas heater gives up and you’re under pressure.
With up to $7,200 off upfront, average savings of $1,800 a year, and heating and cooling combined into one system, the numbers speak for themselves.
👉 Check your eligibility and find out how much you could save at achotwaterrebate.com.au
Disclaimer: Pricing shown is after eligible VEU government discounts. Eligibility depends on property type and existing heating system. This article is general information only and does not constitute financial advice. Savings figures are averages and individual results will vary.