Switching from Gas to Electric Heating in Melbourne: A Complete 2026 Guide
Replacing gas heating with a reverse cycle heat pump system is the most cost-effective and energy-efficient way to electrify your Melbourne home’s heating. In most cases, a VEU rebate is available to reduce the upfront cost, and running costs are lower than gas for most Victorian households on current tariffs.
Here’s everything you need to know to make the switch.
Why Melbourne Homeowners Are Moving Away from Gas
Several factors are accelerating the shift from gas to electric heating across Melbourne:
Rising gas prices. Gas network costs have increased significantly in recent years. Victorian households on gas heating are seeing energy bills rise faster than those who’ve already switched to electric alternatives.
Victoria’s gas transition policy. The Victorian Government has signalled a long-term transition away from natural gas in homes. New residential gas connections have been banned in Victoria since January 2024 meaning homes that switch away from gas cannot reconnect later.
Heat pump efficiency. Modern reverse cycle heat pumps deliver 3–4 units of heat for every 1 unit of electricity consumed. Even at current electricity tariffs, this makes them cheaper to run than gas heating for most households particularly when combined with solar panels.
VEU rebates make the switch cheaper. Replacing gas ducted heating with a reverse cycle system is one of the highest-value rebate categories under the Victorian Energy Upgrades program.
What Are Your Options for Replacing Gas Heating?
Option 1: Reverse cycle ducted system If you have existing gas ducted heating, this is often the most straightforward switch. In many homes, the existing ductwork can be adapted for a reverse cycle system reducing installation cost and disruption.
A ducted reverse cycle system heats and cools the whole home from a single outdoor unit. It’s the most comparable alternative to gas ducted in terms of comfort and coverage.
VEU rebate: Replacing gas ducted heating with reverse cycle ducted is typically one of the higher-value rebate categories.
Option 2: Multi-split or split system For homes where ducted isn’t practical or where you only want to heat specific rooms reverse cycle split systems are the alternative. Multiple units can be installed in the rooms you use most, with each one independently controlled.
Multi-split systems connect 2–5 indoor units to one outdoor unit, which can simplify installation and reduce the number of outdoor units needed.
VEU rebate: Split systems replacing certain gas or resistive electric heating may be eligible.
Option 3: Heat pump hot water (separate from space heating) If you also have a gas hot water system, replacing it with a heat pump hot water system at the same time as your space heating upgrade can maximise rebate benefits and consolidate installation costs. See our dedicated heat pump hot water guide for more detail.
What Happens to the Gas Connection?
When you switch from gas ducted heating to electric, the gas appliance is decommissioned. This involves:
- Disconnecting and isolating the gas ducted unit
- Capping the gas line to the heating system (or full disconnection from the meter if no other gas appliances remain)
- Removing or storing the old gas unit
Evitech handles gas decommissioning as part of the upgrade process. If you’re removing all gas appliances from the home, your gas meter can be removed entirely — eliminating the gas daily supply charge from your bills.
How Much Does It Cost to Switch from Gas to Electric Heating?
Ducted reverse cycle system (replacing gas ducted):
- Supply and install: depending on home size, brand, and whether existing ductwork can be reused
- VEU rebate: potentially several hundred, applied upfront
- Net cost to you: confirmed in your free quote
Multi-split system (2–4 rooms, replacing gas heaters):
- Supply and install
- VEU rebate: varies by product and what’s being replaced
- Net cost to you: confirmed in your free quote
Running cost comparison (typical Melbourne household): Gas ducted heating running cost: approximately for heating season Reverse cycle ducted equivalent: approximately (varies by usage, tariffs, and solar)
Most households recover the upgrade cost through energy savings within 5-10 years, faster with solar panels.
Is Now a Good Time to Switch?
Yes — for three reasons:
- VEU rebates are active and confirmed through 2030. Rebate values fluctuate, but the program is in place. Waiting doesn’t guarantee a better rebate.
- Gas prices are forecast to continue rising. Locking in electric heating now protects against ongoing gas price increases.
- Technology is mature. Modern heat pumps work efficiently in Melbourne’s winter conditions — even on cold mornings. Performance at low temperatures has improved significantly in the past 5 years.
Get a Free Assessment
Ready to switch from gas to electric? Evitech’s team assesses your current gas setup, recommends the right reverse cycle system, and confirms your VEU rebate before you commit to anything.
Call: +1300 137 974
Email:enquiries@evitech.com.au
Frequently Asked Questions
Can I keep my gas hot water if I switch heating to electric?
Yes. You can switch space heating to electric while keeping gas hot water. However, if you want to eliminate your gas connection entirely, both would need to be switched. Evitech can advise the most cost-effective approach for your home