A South East manufacturers’ group has welcomed the State Government’s “about face” on an immediate ban of gas appliances.
The transition from gas to electric appliances reform package was announced on Tuesday 24 June, including the mandatory replacement of end-of-life gas hot water services with electric from March 2027.
New homes and commercial structures built from 1 January 2027 will be required to be all-electric.
Industry and Advanced Manufacturing Minister Colin Brooks said the Government would also prioritise gas supplies for Victorian manufacturers.
It would also help to boost the state’s appliance manufacturing capabilities “so we can keep up with demand for efficient electric appliances”.
South East Melbourne Manufacturers Alliance (SEMMA), representing over 230 manufacturers, says the package was a “real win for local manufacturers”.
“These changes mean local manufacturers who currently produce gas appliances will be able to transition their processes to manufacture electric appliances,” chief executive Honi Walker said.
“They will be able to keep their businesses and their employees and even grow as the need increases.”
Walker also welcomed the Government’s $9.5 Industry Diversification Program to support gas-appliance manufacturers pivot into electric appliance manufacturing.
It would cover the upgrade of existing manufacturing facilities and reskilling workforces.
She also called on the State Government to align its policies with SEMMA’s Australian Manufacturing Blueprint – 2025 & Beyond.
“This blueprint is designed to empower our manufacturers to excel locally, expand globally, create sustainable employment, and secure our industrial future.”
The Gas Appliance Manufacturers Association of Australia (GAMAA) also said it was a step in the right direction.
“Enforcing a one size fits all regulation would have caused serious hip pocket pain to struggling Victorians and devastated the local industry,” GAMAA president Ross Jamieson said.
“Today’s announcement is welcome news but there is more work to be done to make sure families aren’t made worse off under the Government’s proposed changes.
“This includes exemptions for rental properties so that the cost of forced electrification for landlords isn’t then passed onto tenants.”
Mr Jamieson said switching from gas to electric appliances could cost landlords up to $30,000 upfront – leading to rent hikes up to $65 a week.
However, Victorian Council of Social Service (VCOSS) chief executive Janita Pope labelled the mandatory switch from gas heaters to reverse-cycle air-conditioners from 2027 as a “major win” for renters.
Under the reforms, ceiling insulation and draught-proofing must be installed at the beginning of a new lease.
“More and more people are accessing energy hardship programs because they are struggling to pay their energy bills,” Ms Pope said.
“We also know there is a direct connection between poor quality rental properties and poor health outcomes.
“These standards will literally save lives.”
The State Government claims that electric hot water systems will save households about $330 a year, or $520 with solar.
Consumer Affairs Minister Nick Staikos said the reforms would make rental properties “safer, more comfortable and more energy efficient”.
“(It is) giving renters peace of mind for both winter and summer and driving down their bills.”
Opposition energy spokesperson David Davis said the reforms would “kill household gas choice”.
“Their so-called ‘transition’ is more expensive, more unstable, and unreliable, undermining public and commercial confidence and threatening Victoria’s energy and commercial security.
“The Liberals and Nationals will always back your right to cook with gas and your right to make energy choices that suit your home, your budget, and your way of life.”
