Future Gas Strategy: consultation paper

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Future Gas Strategy
Submission to Department of Industry, Science and Resources, November 2023

The Brotherhood of St. Laurence (BSL) welcomes this opportunity to comment on the Future Gas
Strategy consultation paper issued by the Australian Government Department of Industry, Science and Resources (DISR).

Producing and consuming fossil gas causes climate change, and we cannot continue to do this and meet our national and international climate change commitments. A timely transition away from fossil gas is essential for addressing energy costs (which are contributing to the cost-of-living crisis) and climate change. These are critical issues for the people facing disadvantage with whom we work.

Millions of low-income Australians use gas in their homes, and it is becoming increasingly expensive, with retail gas prices having nearly doubled in a decade (SVDP 2023, see appendix). For households who use gas, shifting off gas and improving energy efficiency is the best way to lower bills, gas demand and emissions. Residential electrification should be a major focus of the Future
Gas Strategy. Our recent research report with the ARC Life Course Centre, Enabling Electrification, found low-income households were supportive of shifting off gas but faced a number of barriers including those related to capital, information and trust. The Future Gas Strategy should develop a plan to phase out residential gas networks and include measures to assist lower income households and renters to move off gas.

This submission provides a general response to the consultation paper, focusing on households on lower incomes and those facing disadvantage, and noting that the paper does not ask consultation questions about some key issues, such as emissions reduction (other than via carbon capture).

Summary of recommendations

1. BSL recommends that the Future Gas Strategy identifies areas for policy reform and new
programs to enable households facing disadvantage to electrify their homes, to be delivered
jointly by the Commonwealth and states/territories, specifically:

• Standards to require rented homes to be electric-only, phased in over time (implemented
by states/territories, but guided by the Commonwealth’s Trajectory for Low-Energy Homes).

• Changes to the National Construction Code to rule out gas in new buildings, phased in over

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BSL submission to Future Gas Strategy consultation paper

time.

• A nationwide ban on gas in new homes, as Victoria has announced.

• Grants for low-income households to electrify and install complementary energy efficiency
upgrades as well as rooftop solar.

• Investigate a future ban on gas appliances.

• Provision of trustworthy advice to households via one-stop shops.

2. BSL recommends that, via the Future Gas Strategy, state and federal limit the risks facing
consumers by establishing a framework to plan an equitable phase-out of residential gas
networks.

3. BSL recommends that the Future Gas Strategy contains a substantive plan to reduce
emissions in line with pursuing efforts to limit warming to 1.5 °C, particularly via switching
away from gas.

1 Governments should support households facing
disadvantage to move off gas
For Australia to reach net zero emissions, households must stop using fossil gas. People facing disadvantage will not be able to do this without financial and informational support from governments. Electrification is the best way to move the residential sector off gas: it is a completely mature and cost-competitive technology – with around 30% of Australian households already using electric-only appliances – it can lower emissions to zero, and generally saves households money, thus also addressing cost-of-living (Grattan Institute 2023).

Our research, Enabling electrification: addressing the barriers to moving off gas faced by lower- income households (Chandrashekeran et al. 2023), found 69% of 220 surveyed low-income households (who also faced high levels of financial stress) supported the transition from gas but most faced barriers to doing so, such as lack of funds, renting, or lack of information or trust (e.g.
the lack of a trusted source of information/advice about how to upgrade their homes). Asked about potential policy to assist with electrification, support was strongest for subsidies to lower energy costs; grants to improve energy efficiency; and, for renters, rental provider upgrades to appliances (see figure below).

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BSL submission to Future Gas Strategy consultation paper

Figure from Enabling electrification (Chandrashekeran et al. 2023)

Our respondents’ awareness and utilisation of initiatives supporting electrification were also low compared to other programs, so it is vital that governments promote any such programs to people facing disadvantage.

In our research, people facing disadvantage were often risk-averse to upgrading, and this was magnified for less familiar technologies such as heat pumps for water heating. One participant, for example, said, ‘If I make a mistake I don’t have the resources, being on a pension, to wear that’.

The Commonwealth should reduce obstacles facing households by working with states and territories to:

1. address structural barriers to upgrades for renters through the introduction of mandatory
energy efficiency standards for rental properties that require a shift towards electric-only
homes over time

2. provide clear information about the future phase-out of gas and advice to householders
about how to electrify their homes, preferably through one-stop shops that link with
trusted tradespeople

3. provide financial support to address capital barriers to upgrades.

Recommendation

1. BSL recommends that the Future Gas Strategy identify areas for policy reform and new
programs to enable households facing disadvantage to electrify their homes, to be delivered
jointly by the Commonwealth and states/territories, specifically:

• Standards to require rented homes to be electric-only, phased in over time (implemented by

3
BSL submission to Future Gas Strategy consultation paper

states/territories, but guided by the Commonwealth’s Trajectory for Low-Energy Homes).

• Changes to the National Construction Code to rule out gas in new buildings, phased in over
time.

• A nationwide ban on gas in new homes, as Victoria has announced.

• Grants for low-income households to electrify and install complementary energy efficiency
upgrades as well as rooftop solar.

• Investigate a future ban on gas appliances

• Provision of trustworthy advice to households via one-stop shops.

2 Plan to phase out residential gas networks
As households move off the gas network, those who retain gas will pay for a progressively greater share of gas infrastructure. If people facing disadvantage (including many renters) are not able to move off gas, they are therefore likely to be stuck in an increasingly unaffordable situation. The current regulatory regime for gas networks is not adequate to prevent this situation or more broadly plan for the decline of gas networks.

While gas network businesses argue that their networks should be retained to enable the possible future use of hydrogen or biogas, this is a poor path for equity or climate action. Hydrogen can only be introduced into the gas system up to a certain blend without major, expensive works to the network and home appliances. Even if all this work were undertaken, home hydrogen appliances would be much less efficient and more expensive to run than electric ones (Rosenow
2022). Hydrogen also causes global warming when it leaks (Ocko and Hamburg 2022).

Under current regulatory settings, the cost of refitting networks for alternatives gases would be borne by consumers, including vulnerable households, and the speed proposed by networks is unlikely to be consistent with our international emissions commitments. For example, blending
10% hydrogen into gas only reduces emissions by 3%; Victoria’s networks are proposing introducing a blend by 2030 (Gordon and Morrison 2023), by which time the state is committed to having reduced emissions by 45–50% from 2005 levels (Victorian Government 2023).

The current uncertainty is increasing costs for consumers. In their determination on the recent
Victorian gas access arrangements (2023 to 2028) the Australian Energy Regulator allowed both accelerated depreciation of a proportion of the regulated asset base and some expenditure on hydrogen. This hedging of bets increases costs for consumers. The Commonwealth has a role to play in providing greater certainty on the future of the residential gas network and enabling an equitable phase out of the residential network.

Recommendation

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BSL submission to Future Gas Strategy consultation paper

2. BSL recommends that, via the Future Gas Strategy, state and federal governments limit the
risks facing consumers by establishing a framework to plan an equitable phase-out of
residential gas networks.

3 The strategy contains no real plan to lower
emissions
The Future Gas Strategy consultation paper’s section on emission reduction is inadequate and contains nothing applicable to households, especially those facing disadvantage who will be hit hardest by climate change if we fail to lower emissions. This may be because there is no viable way to reduce residential gas emissions to zero, other than ceasing the use of fossil gas.

Carbon capture and storage (CCS) may play a role in industrial settings, although shifting away from gas is a safer path for the climate because CCS is not a proven technology; as the Climate
Council (2023) notes, ‘there is not a single carbon capture and storage project in the world that has delivered on time, on budget, and captured the agreed amount of carbon’. The consultation paper cites the Gorgon facility in Western Australia as ‘the world’s largest commercial CCS project’, yet this facility has continuously failed to capture the agreed amount of carbon and is now Australia’s largest industrial emitter, capturing only 16% of its emissions last financial year
(Morton 2023). As long as CCS operates this ineffectively, gas will continue to contribute to climate change and its impacts on people facing disadvantage.

Recommendation

3. BSL recommends that the Future Gas Strategy contains a substantive plan to reduce emissions
in line with pursuing efforts to limit warming to 1.5 °C, particularly via switching away from
gas.

Further information
BSL appreciates the opportunity to make this submission. We would welcome a further discussion of our work. For more information, please contact:

Brotherhood of St. Laurence
67 Brunswick Street
Fitzroy Vic. 3065

Ph. (03) 9483 1183 www.bsl.org.au

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BSL submission to Future Gas Strategy consultation paper

References
Chandrashekeran, S, de Bruyn, J, Bryant, D & Sullivan, D 2023, Enabling electrification: addressing the barriers to moving off gas faced by lower-income households, Brotherhood of St. Laurence, Fitzroy, Vic.

Climate Council 2023, What is Carbon Capture and Storage?, Climate Council,. Viewed 13 November 2023.

Gordon J and Morrison K 2023, Renewable gas campaigns leave VIctorian gas distribution networks and consumers at risk, Institute for Energy Economics and Financial Analysis, Lakewood, OH.

Grattan Institute 2023, Getting off gas: why, how, and who should pay?, Grattan Institute, Melbourne.

Morton A 2023, ‘Emissions from WA gas project with world’s largest industrial carbon capture system rise by more than 50%’, The Guardian. Viewed 14 November 2023.

Ocko IB & Hamburg SP 2022, ‘Climate consequences of hydrogen emissions’, Atmospheric Chemistry and
Physics, 22(14):9349–9368, doi:10.5194/acp-22-9349-2022.

Rosenow J 2022, ‘Is heating homes with hydrogen all but a pipe dream? An evidence review’, Joule,
6(10):2225–2228, doi:10.1016/j.joule.2022.08.015.

St Vincent de Paul Society [SVDP] 2023, ‘Victorian Energy Prices January 2023: An update report on the
Victorian Tariff-Tracking Project’.

Victorian Government 2023, Climate action targets, Melbourne, Vic. s. Viewed 14 November 2023.

Appendix

Figure from St Vincent de Paul (2023)

6

Social Policy and Research Centre

Enabling electrification
Addressing the barriers to moving off gas faced by lower-income households

Sangeetha Chandrashekeran, Julia de Bruyn, David Bryant and Damian Sullivan
2023
The Australian Research Council Centre of Excellence for Children and Families over the Life Course
(Life Course Centre, www.lifecoursecentre.org.au) is a national research centre investigating the critical factors underlying deep and persistent disadvantage to provide new knowledge and life- changing solutions, for policy, service providers and communities. The Centre is administered by the Institute for Social Science Research at The University of Queensland and is a collaboration with the University of Melbourne, the University of Sydney and The University of Western Australia as well as leading international experts. It is supported by key Australian government and non-government organisations and community, business and philanthropic partners working at the front line of disadvantage.

The Brotherhood of St. Laurence (BSL, www.bsl.org.au) is a social justice organisation working alongside people experiencing disadvantage to address the fundamental causes of poverty in Australia.
Our mission is to pursue lasting change, to create a more compassionate and just society where everyone can thrive. Our approach is informed directly by the people experiencing disadvantage and uses evidence drawn from our research, together with insights from our programs and services, to develop practical solutions that work.

This report was written by Dr Sangeetha Chandrashekeran and Dr Julia de Bruyn (Life Course Centre) and David Bryant and Damian Sullivan (Brotherhood of St. Laurence).

Suggested citation: Chandrashekeran, S, de Bruyn, J, Bryant, D & Sullivan, D 2023, Enabling electrification: addressing the barriers to moving off gas faced by lower-income households, Australian
Research Council Centre of Excellence for Children and Families over the Life Course & the
Brotherhood of St. Laurence, Melbourne.

The extended version of the research report is available on request. Please email Sangeetha
Chandrashekeran at sangeetha.chandra@unimelb.edu.au or Damian Sullivan at dsullivan@bsl.org.au

Published by
Australian Research Council Centre Brotherhood of St. Laurence of Excellence for Children and Families 67 Brunswick Street over the Life Course Fitzroy, Victoria 3065
The University of Melbourne Australia
Grattan Street ABN 24 603 467 024
Parkville, Victoria, 3010 ARBN 100 042 822
Australia
T +61 3 9483 1183
ABN 84 002 705 224
www.bsl.org.au
T +61 3 9035 5511 www.lifecoursecentre.org.au

© Brotherhood of St. Laurence 2023

Apart from fair dealing for the purpose of private study, research, criticism, or review, as permitted under the Copyright Act 1968 and subsequent amendments, no part of this paper may be reproduced by any process without written permission. Enquiries should be addressed to the publisher.
Contents
Acknowledgements 4

Summary 5 5 Consumer journeys 22
Research approach 5
Findings 5 6 Implications 26
Implications 8
Multiple stressors 26
Information and knowledge 26
1 Electrification and Tenure and control 28
lower-income households Capital and finance 29
in Victoria 9 Rooftop solar and energy efficiency 29
Inclusive planning processes 30
2 Our research approach 11
References 31
3 A profile of our
research participants 12
Financial stress 14
Energy hardship 14
Housing affordability and precarious housing 15

4 Findings 16
Energy preferences and attitudes to a transition away from gas 16
Factors influencing electrification 17
Awareness and utilisation of existing support 19
Access to information 19
Importance of potential support measures 20
Variation in interest and capacity to electrify 21

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 3
Acknowledgements
This project was funded by Energy Consumers Australia
(www.energyconsumersaustralia.com.au) as part of its grants process for
consumer advocacy projects and research projects. The views expressed in this
document do not necessarily reflect the views of Energy Consumers Australia.

This research was supported by the Australian Government through the
Australian Research Council's Centre of Excellence for Children and Families
over the Life Course (Project ID CE200100025). Additional financial support was
received from the Melbourne Energy Institute at the University of Melbourne.

We acknowledge the time and efforts of our survey respondents and focus group participants, without whom this research would not have been possible.

This project received research ethics approval from the University of Melbourne (ID 24478).

Cover photo: yamasan0708/Shutterstock

4 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Summary
Shifting households from carbon-intensive natural gas to less carbon-intensive fuels like renewable electricity is becoming a priority as the imperative to decarbonise accelerates. Little attention has been paid to date to the equity implications of the 5 million households on the gas network in Australia disconnecting from gas and converting their homes to all-electric. This report draws on surveys and focus groups with households facing energy stress to understand their attitudes to disconnecting from gas, and to identify the barriers and enablers to the change. Most participants supported the transition from gas, but few had electrified appliances, most commonly due to barriers such as cost or renting their home. These insights will be important to ensuring an equitable planned transition to electric homes in Victoria and other jurisdictions.

Research approach Findings
We studied households in Victoria, the state which Most participants supported the has the highest prevalence of residential gas use transition from household gas in Australia and where plans for an economy-wide transition away from fossil gas are underway. Participants in our study expressed a high level of
We conducted an online survey, which received support for a transition away from household gas
236 responses, and in-person and online focus and toward cleaner energy sources in Victoria.
groups with 34 people. We invited households Around half of our respondents indicated strong that had received energy-related support from support and more than two-thirds indicated some the Brotherhood of St. Laurence, a social justice level of support. Support was greater with higher organisation based in Melbourne, as well as lower- levels of education, but there was no significant income households from Melbourne’s Burmese difference by capacity to meet heating and food community. Most of our respondents used gas costs, financial stress, housing tenure, location
(88%), reflecting its prevalence in Victoria. or age.
Our survey collected information on people’s housing, energy use and preferences (e.g. gas Tenure is a key factor in electrification versus electric cooking), access to government energy programs, and opinions on electrifying Housing tenure emerged as a clear differentiating their homes. In our focus groups, we asked people factor. Not owning a home was one of the most how they feel about shifting from gas, their reported barriers to electrification, alongside priorities and challenges for energy use in their upfront costs. Many renters reported poor homes, their ability to electrify, and what support housing conditions and an unwillingness to raise they need to do so. improvements with their landlord out of fear of
rent increases or eviction. Home ownership was
associated with higher awareness of Solar Homes,
the Victorian Government’s support program
for solar installation. More generally, home
owners were able to exercise a greater degree
of control over upgrades compared with renters
who typically face a low level of involvement or
consultation in decisions made by their rental or
housing provider.

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 5
Energy preferences were mixed and Awareness of electrification linked to current usage programs lags behind that of
Respondents considered electric appliances to other schemes be safer and better for the environment, while gas Participants showed high awareness and uptake appliances were considered to perform better for of state government payments to assist with heating and cooking. Respondents’ preferences energy costs (e.g. the Power Saving Bonus and for gas or electric appliances were strongly linked energy concessions). By contrast, far fewer people to their existing usage. For example, a preference knew about or had used three programs that could for gas heating was more than twice as common support electrification: among households who had gas heating. This may represent a status quo bias, so it is possible that • One in three people had heard of the Victorian exposure to equivalent electric appliances would Energy Upgrades (VEU) Program and the Home reduce attachment to gas appliances. Heating and Cooling Upgrades (HHCU) Program
(since discontinued).
Most people preferred gas cooktops over electric
• Awareness of the Solar Homes Program was ones, because of the perceived speed, ease
almost twice as high, at 58%, as of the HHCU and flexibility of cooking with gas, although few
(targeted at lower-income households).
participants had experience of induction stoves.
Awareness of Solar Homes Program was higher
People who spoke a language other than English
among male participants (66% vs 56% among were significantly more likely to prefer gas heating
women), those over 60 years of age (74% vs and gas hot water.
43% among younger people), those living in
their own home (77% vs 38% among private
Cost saving and environmental renters), and those unable to heat their home or benefits drive electrification struggling with food costs in the past year (71%
vs 44% among others).
Only one in ten surveyed households had replaced gas appliances with electric ones within the past five years, suggesting support for the transition in principle has not been translated into action on a large scale. Among those who had switched, the main reasons were lower running costs and environmental benefits.

Not owning a home was one of the most reported
barriers to electrification, alongside upfront costs.
Many renters reported poor housing conditions
and an unwillingness to raise improvements
with their landlord out of fear of rent increases
or eviction.

6 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Households’ capacity and interest vary
We identify four categories of households, based on interest in, and capacity for, electrification
(Figure 1). Interest describes how strongly people feel about the need to shift away from gas.
Capacity refers to how readily people can make the required changes. Interest and capacity differ depending on home ownership, financial position and household characteristics (e.g. families with children, people with disability, age).

Figure 1 A matrix of consumer types, differentiated by interest in, and capacity for, electrification

High interest

High level of interest, High level of interest and
but lack capacity have (some) capacity
• Energy affordability and • Driven by environmental
environmental concerns, but concern or desire to lower
not translated into action future energy costs
• Likely to be less aware of • Have already taken action in
available support their home
• Constrained by housing • Typically home owners, aware
tenure, upfront costs or trust of available support

Low High
capacity capacity
Low level of interest Low level of interest,
and lack capacity but have capacity
• Multiple forms of hardship • Variable level of knowledge
• Not proactively planning for about environmental issues
change; other priorities • Includes some households
dominate decision-making that oppose a transition away
• Typically low-income from gas
households in private rental • May express climate change
or social housing scepticism

Low interest

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 7
Implications Tenure and control
• A strategy to support renters and rental
Key points with implications for policy from this providers to electrify (including minimum study include: standards for energy efficiency and improved
tenure security) is essential to overcome
Multiple stressors split incentives.
• Households facing barriers to electrification
also experience many other financial Capital and finance
challenges and may therefore be unable to • Addressing capital barriers is vital to household
prioritise electrification even if they have electrification, ideally through means-tested
the necessary information and inclination. electrification-specific rebates and, where
Alongside policies to promote electrification, appropriate, loans.
a comprehensive effort is needed to reduce
poverty, including adequate income support,
and providing access to decent, secure, and Rooftop solar and energy efficiency
affordable housing. • Access to solar panels is a key step for
electrification, but renters and lower-income
Information and knowledge households will need more assistance to
get started.
• Lower-income households lacking information
may be deterred by the perceived risks of • Energy efficiency upgrades, which maximise
electrification, which could be partly addressed the benefits and reduce the payback period
by information provision and financial for new technologies, need to be integrated
assistance. in supports for lower-income households to
electrify their homes.
• More evidence-based information on the
benefits of electric versus gas appliances will
aid household decision making. Inclusive planning processes
• Awareness of existing electrification programs • The voices of those facing major barriers to
is fairly low, despite high support for the electrification need to be heard and better
transition from gas. Better targeted promotion included in the planning for this change.
of programs, as well as broader information
provision on electrification, could assist.
• Trusted advice and one-on-one guidance are
needed to support households to electrify;
and they must be tailored to financial
circumstances. Tradespeople and retailers
should also be supported to provide accurate
information about electrification.
• A plan for the future of the residential gas
network will increase certainty for households
and industry.

Tradespeople and retailers should also be
supported to provide accurate information
about electrification.

8 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
1 Electrification and
lower-income
households in Victoria
Our research focuses on people experiencing, or vulnerable to, energy hardship, as well as a wider group of households in Victoria that lack key resources or capabilities to electrify their home.

There has been little research exploring the As part of its commitment to net zero greenhouse capacity of households with limited economic gas emissions by 2050, the Victorian Government resources to electrify their home. Low-income is planning a transition away from natural gas. Its households spend a larger proportion of their Gas Substitution Roadmap has highlighted the role income on energy bills, compared to higher- that will be played in electrification by Victorian income households – despite using less energy households replacing gas appliances with electric and spending less in dollar terms (ACOSS & BSL ones, for heating, cooking and hot water.
2018). A poorly managed transition away from
Electrification presents upfront costs, such gas risks exacerbating disadvantage, but on
as new appliances and, in some cases, wiring the other hand there is scope to reduce energy
upgrades and other building modifications. For hardship through effective policy, regulatory and
those willing and able to make these changes, market actions.
there are long-term economic benefits.
Victoria is an important place for this study Government analysis estimates a typical Victorian because it has the highest level of residential gas household could reduce its annual energy costs by use in Australia, with around 73% of households $1,020 by replacing gas heating, cooking and hot connected to the reticulated gas network (ESC water systems with electric ones – and by $1,250
2023; ABS 2021) (there are also some bottled for those with solar power (Victorian Government gas users). Many Victorian households rely on 2022). These savings will be amplified if the price gas for heating, hot water and cooking. Gas of gas continues to rise relative to electricity. Gas- makes up a large proportion of household energy retaining households may also face higher gas consumption, and gas consumption (including network charges in future as the cost of running commercial and industrial as well as residential) gas infrastructure is shared between progressively contributes around 17% of the state’s greenhouse fewer users. In turn, these charges may accelerate gas emissions (Victorian Government 2022:3). households’ departures from the gas network,
increasing prices further. This potential situation
is often called a ‘death spiral’ for gas networks.

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 9
Definitions and data collection
In this study ‘energy hardship’ refers to a general situation where people cannot achieve an adequate level of energy services in their home
– or where achieving this level leads to financial stress and/or deprivation of other essential goods and services.1
We use ‘capabilities’ to refer to the individual and structural factors which enable people to convert resources into opportunities and make change
(Willand et al. 2021; Robeyns 2017).
We have integrated findings from an online survey and a series of in-person and online focus group discussions. Our analysis provides insights on the willingness and capacity of these households to transition from gas to electricity use, to guide recommendations for targeted policies and support measures.

A poorly managed transition
away from gas risks exacerbating
disadvantage, but on the other
hand there is scope to reduce
energy hardship through
effective policy, regulatory and
market actions.

1 We distinguish this from the applied, specific use of the term ‘hardship’ in an energy retailer’s hardship program.

10 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
2 Our research approach
Our primary mode of recruitment for this study was an invitation to households that had received support from the Brotherhood of St. Laurence during the previous two years, through one or more energy-related programs. To increase the representation of culturally and linguistically diverse (CALD) participants, we also extended an invitation to lower-income households of the Burmese community in Melbourne with whom the research team had existing contacts.

This research contributes to a growing body • an online survey to collect information on of evidence on consumer perspectives on sociodemographic characteristics including a transition away from gas in Victoria. It indicators of hardship, housing, current complements recent surveys commissioned by energy use and preferences, awareness and
Infrastructure Victoria (Quantum Market Research utilisation of government programs related to
2022) and the former Department of Environment, energy, and attitudes to a transition away from
Land, Water and Planning2 (2021), which produced household gas findings representative of Victoria’s population • focus group discussions, in person and online, by age, gender and metropolitan or regional to explore perspectives on the proposed energy location. Our purposive sampling and mixed transition, priorities and challenges in energy methods approach offers additional insights use in the home, capacity for electrification, into perspectives of lower-income households, and potential support measures.
many of whom are vulnerable to energy hardship
(Figure 2). We conducted: This study was approved by the University of
Melbourne Human Research Ethics Committee (ID
24478).

Figure 2 Participant recruitment and data collection

Invitation to complete online Invitation to participate in study
survey sent by email to ~1,200 shared by word of mouth to
households previously supported refugee and migrant
by Brotherhood of St. Laurence households of Burmese
Online for energy hardship community in Melbourne
survey
Quantitative
data 236 completed surveys
16 survey responses
excluded based on income
level or financial position
220 survey responses included
of household
in quantitative analysis

80 survey respondents 46 survey respondents
Focus contacted by email or phone to not interested or
invite participation in a focus available to join a focus
group
group discussion group discussion
discussions
Qualitative
data
34 participants in focus group
discussions, contributing to
qualitative analysis

2 Now the Department of Energy, Environment and Climate Action (DEECA).

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 11
3 A profile of our
research participants
There is growing recognition of the many factors beyond income that lead to experiences of vulnerability.
These span individual and household circumstances, policies and dynamics of the energy sector, and the wider social, political and economic context; and they may change in sudden and unexpected ways. Within the energy sector, there is commitment to improving identification of vulnerability, increasing consumer engagement, strengthening consumer protections and drawing on lived experience of vulnerability to shape sectoral reform (AER 2022; ESC 2021). Our research seeks to expand understanding of factors which may make lower-income households vulnerable to energy hardship and being ‘left behind’ in a zero- carbon transition.
Our sample includes a high proportion of older and third (31%) of respondents reported a household female respondents. Most surveyed households income below $20,000 per year, and a large
(87%) received some form of income support, and majority (85%) reported an income below $40,000 the group can generally be described as lower- per year. Around half of our respondents were income. Based on equivalised figures, adjusted for renters in either private or social housing. Table 1 the number and age of household members, one- shows a range of characteristics of our sample.

Table 1 Selected characteristics of survey respondents

Characteristics of survey respondents (n = 220)
Respondent characteristics
Female 68%
Over 60 years of age 50%
Born outside Australia 38%
Completed high school 71%
Employed, full-time or part-time 24%
Care responsibilities as main activity 29%
Household characteristics
Language other than English spoken at home 25%
Includes child(ren) 35%
Household type
Lone person 33%
Couple 17%
Couple with children 20%
Single parent with children 17%
Receive income support
Any type 87%
Age Pension 37%
Disability Pension 21%
Carer Payment 15%
JobSeeker Payment 15%
Parenting Payment 12%

12 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Characteristics of survey respondents (cont.)
Annual household income, equivalised
<$20,000 31%
<$40,000 85%
Housing tenure
Social housing 14%
Private rental 35%
Own with mortgage 17%
Own outright 31%
Dwelling type
House or single-storey unit or flat 86%
Multi-storey unit or flat 8%
Location
Greater Melbourne 84%
Regional Victoria 11%

Notes: Some categories with low responses have been omitted. Some households received multiple forms of income support.

A large majority (88%) of survey Figure 3 Current gas use respondents currently used gas in their home (Figure 3). Gas use was significantly higher Current gas use in Greater Melbourne than in regional Victoria, and by home owners than those in private rental or social housing. Almost
88% all surveyed
housholds two-thirds (64%) of surveyed Significantly higher gas use: households used gas heating, • among home owners (93%) than renters (82%) and over three-quarters (76%) • in Greater Melbourne (90%) than regional Victoria (68%) used gas for cooking. Of the various combinations of gas appliances and uses in the home, Gas use (% of all gas-using households) having a gas cooktop, hot water system and heating was the 53% most common (53% of gas users in this study).
20%
Achieving an inclusive transition away from gas relies on understanding the diverse
13% Oven challenges and competing Cooktop priorities faced by lower-income 9% households and others at risk of Heating being left behind. Our findings 5% Hot water highlight some experiences of severe and sustained energy hardship, within a wider context of financial stress and precarious housing.

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 13
Financial stress Figure 4 Financial stress

Households face financial stress when they cannot meet basic financial commitments Financial stress

57% because of a shortage of money (Wilkins et al.
2021). A household is considered to be in financial Surveyed households stress if two or more of seven events3 have are in financial stress applied to them in the past year. Over half (57%) of (2+ of 7 indicators, past year) surveyed households were in financial stress, with
Higher financial stress significantly linked to: significant variation according to housing tenure,
• lower income income and household composition (Figure 4).
• younger age
Participants in this study had an average • living in private rental or social housing financial stress score of 2.6 (on a 0–7 scale), • single-parent households markedly higher than the average score of 0.7 for
• disability or chronic illness households in a nationally representative sample of the Australian population (Wilkins et al. 2021).
The most common indicator of financial stress Average financial stress score (0–7) in the past year was inability to pay bills on time, reported by almost half of all survey respondents Our sample 2.6
(48%). Nearly half had asked for assistance from friends, family or a welfare organisation. More HILDA sample^ 0.7 than a third had pawned or sold possessions. One
^ Household, Income and Labour Dynamics in Australia survey in four people (26%) had gone without meals, an (~10,000 households, nationally representative, 2019 data) event considered to indicate severe financial stress, compared with around one in 25 people in the wider Australian population (Wilkins et al.
2021). One person explained:

You have to make the choice between feeding
your kids and (paying) your power (bills). I’d go
Energy hardship
without a lot to make sure that my kids had Energy hardship, also referred to as energy stress
what they needed, but also so I didn’t feel that or energy poverty, describes a situation where
I was put in the position to ask for help when I people cannot achieve an adequate level of energy
was made to feel inadequate for asking. services in their home (Petrova and Bouzarovski
Female participant, 40–49 years, private renter 2015) or where achieving this level causes financial
stress (e.g. rationing of other essentials). This
reflects the relationship between a household’s
income, energy costs and energy consumption.
There is no universally accepted approach to
measure energy hardship. One common approach
focuses on the ratio between energy bills and
household income, but has been criticised
because it may overlook those households that
are restricting energy use (Chandrashekeran
et al. 2022). Households may also make trade-
offs, including delaying the payment of bills and
prioritising scarce funds for essential needs.

3 These events are: could not pay electricity, gas or telephone bills on time; could not pay rent or mortgage on time; asked for financial
help from friends or family; were unable to heat home; went without meals; pawned or sold something; asked for help from welfare/
community organisations.

14 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Households in energy hardship may experience With the kids out of the house, I just put on an periods when they cannot heat their home or go extra jumper and jacket and sit under blankets without meals due a shortage of money. Based … As much as I care, I don’t either, because on experiences over the previous year, 42% of both of my boys are now out of home, so our cohort are in energy hardship by this marker I’ve stopped worrying about certain things,
(Figure 5). If we also include those unable to pay because it is just me.
bills on time, even if energy usage has not been Female participant, 50–59 years, private renter affected, we find close to two-thirds (64%) of surveyed households are in energy hardship.

Figure 5 Indicators of energy hardship
Housing affordability and
precarious housing
Indicators of energy hardship Housing tenure emerged as a clear differentiating
factor in this study, linked to financial capacity,
Experiences of past twelve months: quality of living, agency to make energy-related
decisions, and level of engagement with energy

35% Unable to
heat home
issues. Around half of our respondents were
renters (either social or private).
Close to one in three surveyed households

42% Unable to heat home (31%) had been unable to pay their mortgage or
and/or went without rent on time at some point in the previous 12
meals months, compared with 6% reported in the wider
Australian population (Wilkins et al. 2021). In focus

64% Unable to heat home groups, multiple people described the challenges
of finding affordable housing.
and/or went without
meals and/or unable to Focus groups revealed poor living conditions in
pay bills on time rented homes, and most renters’ reluctance to
suggest improvements to landlords, including to
improve energy efficiency or change appliances,
out of fear this would lead to a rent increase:
Efforts to limit home energy use were widespread, most commonly reducing the use of heating. This I’d be lucky to get a one-bedroom unit in the often involved turning heating devices on for short worst part of [this area] for the same price I periods only, wearing additional layers of clothing now pay, so for that reason I stay, and for that at home or spending more time in bed. Two same reason, I don’t really complain too much participants spoke of showering less frequently, to the landlord about certain things.
to lower energy costs. Several parents spoke of
Female participant, 40–49 years, private renter their willingness to tolerate cold conditions after their children had moved out. Many also described minimising the use of lighting, including using lamps rather than overhead lights, or changing activity patterns:

We’re always lights out, in bed by 8 pm, just to
keep warm, because my daughter and I, we get
so cold in the winter that we actually sleep in
the same room with a small plug-in heater just
to try and keep each other warm because it is
like ice.
Female participant, 30–39 years, private renter

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 15
4 Findings
This section presents findings from our survey and focus groups about participants’ energy preferences and attitudes towards the transition from gas, factors influencing electrification, awareness of supports and influence of future supports, and access to information.

Energy preferences and A common and strong preference for gas cooktops
over electric ones was supported by both survey attitudes to a transition and focus group data. Many participants spoke
positively of the speed of cooking with gas, and away from gas the ease of adjusting cooking temperatures. Few
focus group participants were aware of induction
Key findings include that participants’ preferences cooktops, and only one had experience of using for gas or electric appliances are strongly linked them. Respondents preferred electric ovens to to their current use, and that support for the gas gas ones, and electric ovens were already far transition is high in principle. more common.

Energy preferences Perceptions about gas and electricity
Survey results highlight that preferences for When asked to compare the benefits of gas home energy use are linked to current energy use, and electric appliances (Figure 6), our survey across all categories. Gas-using households were respondents considered gas appliances to more likely to favour gas over electricity. This was perform better for heating and cooking, while particularly evident for heating: gas was preferred electric appliances were considered better for the by 40% of households currently using gas heating, environment, and safer. Some 34% of respondents compared with only 18% of those without it. This considered gas to have lower running costs, while suggests that the experience of using electric 28% thought electric appliances were cheaper to heating appliances, including reverse-cycle air run and 29% did not know. Whereas 17% thought conditioners, may reduce an attachment to gas gas appliances were cheaper to buy and install, heating. In general, heating preferences were 25% thought electric appliances were cheaper evenly split between gas and electric. upfront and a significant number of respondents
(44%) did not know.
Focus group insights suggest that those who prefer gas heating – particularly central heating – want a uniformly warm home. In contrast, those favouring electric heating value being able to selectively heat areas of the home according to which rooms are in use, and which household members are present.

Our survey reveals a high level of
support for a transition away from
gas in Victoria.

16 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Figure 6 Perceived benefits of electric appliances vs gas appliances

Perform better at heating and cooking 15% 14% 23% 48%
More reliable or need less maintenance 30% 14% 29% 26%
Lower running cost 28% 8% 29% 34%
Cheaper to buy and install 25% 14% 44% 17%
Better for the environment 44% 12% 33% 11%
Safer for my household 44% 18% 27% 11%

Electricity No difference I don’t know Gas

Attitudes to a transition away from Factors influencing gas in Victoria and ending gas network expansion electrification
Our survey reveals a high level of support for a Around one in ten surveyed households (13%) had transition away from gas in Victoria (Figure 7). replaced gas appliances with electric ones within
Around half of our respondents indicated strong the past five years (Figure 8). Among this small support and more than two-thirds indicating group (n = 29), there were no significant variations some level of support, with only 7% (n = 17) by individual or household factors. Electrification expressing opposition. Those who had expressed was most commonly motivated by perceived lower a preference for gas (for cooking, heating or hot running costs and environmental benefits.
water) were significantly less likely to support Twice as many surveyed households with solar electrification. Support was greater with higher panels as without solar panels had replaced gas levels of education, but there was no significant appliances with electric ones in the past five difference by financial stress, housing tenure, years (Figure 9). Having solar panels was also location, age, or capacity to meet heating and food significantly linked to an ambition to replace gas costs. Most participants also supported ending appliances in the future. Fewer than one in five the expansion of the gas network (55% expressed households in this study currently used solar some level of support). power in their home, ranging from around one
in three home owners (30%) to one in fifteen in
private rental or social housing (7%).
Figure 7 Opinion on a transition away from gas
Tenure emerged as a key factor, with home
owners more likely to be aware of supports for
Opinion on a transition away solar and have solar panels (which incentivise
electrification). For those who had not replaced
from gas gas appliances, not owning their home was one

69%
of the most significant barriers to electrification,
support (49% alongside upfront costs. (A larger group were
strongly support) not inclined to replace gas appliances that were
working fine.)
• More likely with higher levels of education
• Less likely with a preference for gas
• No association with tenure, location, age
or financial stress

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 17
Figure 8 Drivers of and barriers to replacing gas appliances

Replacing gas appliances

13% have replaced gas appliances
in the past five years
Environmental concern 31%
Lower running costs 28%
Lower upfront cost 21%
Drivers

Don’t know 21%
Safety 15%
Discount or rebate 14%
Recommendation 14%
Easier installation 10%

Don’t own home 34%
Barriers

Upfront cost 34%
Favour gas for performance 12%
Environmental concern 4%

34% would like to replace gas
appliances in the next five years
Lower running costs 44%
Environmental concern 22%
Lower upfront cost 10%
Drivers

Discount or rebate 6%
Safety 5%
Don’t know 3%
Recommendation 3%

Note: Responses are from different subgroups and respondents could select multiple drivers or barriers.

Figure 9 Solar panels, housing tenure and electrification

Solar panels, home ownership and electrification

19% currently use
solar power
Which households have
replaced gas appliances?
With solar panels 22%
Solar panels significantly
associated with housing
Without solar panels 11%
tenure:
Which households would like to
• 30% among home owners
replace gas appliances?
• 13% in social housing
• 5% in private rental With solar panels 59%
Without solar panels 31%

18 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Awareness and utilisation provider were more likely to see the potential in
the Solar Homes Program than those who did of existing support not know their rental provider or did not have
a good relationship with them. Despite some
Our research confirms a large majority of positive views about the scheme, most renters households were aware of and had accessed (by were deterred by the challenge of coordinating
August 2022) the Victorian Government’s Power with multiple entities and having to make a co-
Saving Bonus, and the energy concessions (which contribution.
provide close to a 17.5% reduction in electricity bills and a reduction in gas bills) for people on low incomes holding a Pensioner Concession Card, Access to information
Health Care Card or Veterans’ Affairs Gold Card.
Focus group participants emphasised the
By contrast, there was lower awareness – and a importance of trust in sources of information marked gap between awareness and utilisation about energy-related decisions, and many
– of three government programs which support regarded the lack of tailored, independent sources electrification (Figure 10). Only around one in as a problem.
three people in our survey had heard of the Home
Heating and Cooling Upgrades Program (29%) and Respondents had high levels of trust in the Victorian Energy Upgrades Program (35%). information from social welfare organisations;
Awareness was higher among male participants government bodies, especially councils; and
(66% vs 56% among women), those over 60 years social and cultural networks, particularly for of age (74% vs 43% among younger people), those people who speak a language other than English living in their own home (77% vs 38% among at home. Tradespeople and appliance or energy private renters), and those unable to heat their retailers were also seen as important sources of home or struggling with food costs in the past year information, but as less trustworthy.
(71% vs 44% among others).
We prefer information coming from the
The Solar Homes Program had been accessed
community. That way we can relate to one by one in four home owners surveyed (25%),
another, and [it’s] easier to understand … we compared with less than one in ten people in
don’t need to go through the messy, technical private rental accommodation (8%) or social
process.
housing (10%). In focus groups, renters who had a direct and positive relationship with their rental Male participant, 40-49 years, owns home with mortgage

Figure 10 Awareness and utilisation of Victorian Government energy-related programs

Power Saving Bonus 75% 84%
Reduced energy bills for concession card holders 75% 82%

Victorian Energy Upgrades Program 13% 35%
Home Heating and Cooling Upgrades Program 6% 29%

Solar Homes Program 17% 58%
– Homeowners 25% 78%
– Renters 8% 40%

Utilisation Awareness

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 19
Importance of potential shows that information-based measures receive
higher support from households speaking a support measures language other than English, compared with those
speaking English only. Subsidies to lower energy
Survey respondents were asked to rate the costs and grants to improve energy efficiency importance of potential support measures in were considered very important by households enabling them to transition away from gas in who were extremely conscious of limiting their their home (Figure 11). Support was strongest energy use. Financial support to purchase electric for subsidies to lower energy costs; grants to appliances was rated highly by renters, those with improve energy efficiency; and, for renters, rental solar panels, and those speaking a language other provider upgrades to appliances. Our analysis than English at home.

Figure 11 Importance of support measures to households surveyed

Grant to reduce the cost of buying new electric appliances 18% 61% 21%

Subsidy to lower energy costs 10% 80% 9%

Energy efficiency assessment and advice 22% 60% 18%

Grant to improve energy efficiency 14% 75% 11%

Information provision, via website or phone 23% 53% 24%

Rental provider to upgrade appliances 16% 74% 11%

0% 20% 40% 60% 80% 100%

Very important Moderately important Not important or I don’t know

Support was strongest for subsidies to
lower energy costs; grants to improve
energy efficiency; and, for renters, rental
provider upgrades to appliances.

20 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Variation in interest and reflects both household members’ knowledge,
skills, resources and circumstances and wider capacity to electrify structural and contextual influences. Quantifying
the households that fall into each group is a
Our findings demonstrate a high level of support possible subject for future research.
for a planned transition away from gas; however, Among our participants, capacity to electrify had opportunities for households to electrify vary been improved for some through the provision of considerably. In Figure 12, we identify on the axes advice or subsidised retrofits by BSL.
two key factors that shape the electrification journey: (i) interest in electrification, and (ii) capacity to electrify. Interest describes the extent to which people desire to transition away from gas, and reflects their beliefs, values and priorities. Capacity refers to the extent to which people are able to make desired changes and

Figure 12 A matrix of consumer types, differentiated by interest in, and capacity for electrification

High interest

High level of interest, High level of interest and
but lack capacity have (some) capacity
• Energy affordability and • Driven by environmental
environmental concerns, but concern or desire to lower
not translated into action future energy costs
• Likely to be less aware of • Have already taken action in
available support their home
• Constrained by housing • Typically home owners, aware
tenure, upfront costs or trust of available support

Low High
capacity capacity
Low level of interest Low level of interest,
and lack capacity but have capacity
• Multiple forms of hardship • Variable level of knowledge
• Not proactively planning for about environmental issues
change; other priorities • Includes some households
dominate decision-making that oppose a transition away
• Typically low-income from gas
households in private rental • May express climate change
or social housing scepticism

Low interest

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 21
5 Consumer journeys
This section presents individual focus group participants’ electrification stories, providing illustrative examples of barriers and how decisions are made for the households in the different categories we have identified. All names are pseudonyms.

High interest and have capacity

Alan
Alan is a retired engineer, whose capacity to electrify reflects his home ownership and his knowledge,
skills and time to undertake home improvements. He is highly motivated to electrify for affordability
reasons, but family breakdown has constrained his financial capacity to invest in upgrades. Alan
thinks very carefully about how to use his limited resources, and prioritises DIY solutions, trying
to avoid costly mistakes. Although his digital literacy is low, his energy and financial literacy are
relatively high. He could see the quick payback on solar panels from generous state feed-in tariffs in
the late 2000s, and purchased solar panels accordingly. This has proven to be an economically wise
decision; however the high feed-in tariff will end in the next few years, and he is concerned about the
sustainability of his existing system and the affordability of a new system. Alan lives frugally and sees
energy efficiency and small home retrofits as the best way to spend his time and resources.

Accesses trusted
information through
Has skills to social networks from Early adopter of solar
improve energy professional background photovoltaics due to
efficiency of home as engineer generous feed-in tariff

Alan
Older home owner.
Has skills and
motivation to Awareness, Engagement with
invest in home research and marketing and support Purchase Installation
improvements to planning opportunities
lower future
energy bills.
Environmentally aware, Financially Concerned about
but not strongly constrained due poor quality of
motivated by to life events appliances: cheap
environmental concern; manufacturing,
favours choice over built-in
mandates obsolescence

22 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
High interest, but lack capacity

Diego
Diego, a self-described ‘forever renter’ and pensioner, displays a number of capacities that would
enable a transition away from gas, including a postgraduate education, high financial literacy
and environmental interest. He reported a positive, longstanding relationship with his current
rental provider. Despite this, when his gas heater broke down, Diego went two months without a
replacement. On hearing he would have been eligible for the Home Heating and Cooling Upgrades
Program to install a split system air conditioner, he lamented that a lack of knowledge had prevented
this electrification opportunity: ‘If I just told [my rental provider] it’s better to install an electric heater,
he would do it’. Instead, a tradesperson arrived and installed another gas heater. Information about
support and appliance options at the right time and consultation between Diego and his rental
provider might have prevented his being locked into gas heating and its ongoing costs.

(“If I just told him, it's better to
install an electric heater, he
(“If it will be beneficial to the would do it.”)
environment, I don't mind adjusting
to the changes, switching from gas
Considers relationship with rental
to electricity.”)
provider to be positive
Has postgraduate level of
education, thinks and cares deeply Willing to pay more for a product
about environmental issues with low environmental impact

Diego
Long-term renter.
High level of
education and Awareness, Engagement with
environmental research and marketing and support Purchase Installation
concern. planning opportunities
Aspirations for
energy
independence, Identifies self and rental provider as Purchase decision Reluctance to
living off-grid in an having inadequate information and made by rental co-invest in rental
energy-efficient awareness of support available provider, without property; limited
home. consulting tenant financial capacity
(“I didn’t know. He didn’t know.”)
(“I’m a pensioner and
Recent breakdown of gas heater: surviving is always
Two months relying on electric column difficult for me.”)
heater and heat generated in kitchen,
before replacement installed

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 23
High interest, but lack capacity

Maria
Maria, an older home owner with a migrant background, lives in the western suburbs of Melbourne.
She was confident in her ability to access information online, including through her local council’s
website. Through that website she discovered the Victorian Healthy Homes Program, which
identified and funded improvements to the energy efficiency of her home, such as heavy curtains and
draught excluders for doors.
Nevertheless, when her gas hot water system later broke down, she replaced it with another gas
system, despite having recently inherited money that could have covered the cost of an electric
alternative. This was because Maria was unaware of electric alternatives that might have lower
running costs and environmental impact, and the government support available (e.g. Victorian Energy
Upgrades program).
It is a priority to Maria to electrify her home, beginning with solar panels, but she now lacks the
finances to cover the upfront costs even with government rebates and an interest-free loan. Another
major barrier for Maria is her lack of trust in retailers and installers; she says, ‘If I make a mistake I don’t
have the resources, being on a pension, to wear that.’

“I do care about the environment, and if I had the
money, I would have made some changes already.“

(“I think I have reasonable
information to decide.”)

Feels able to access information Would be open to an Trusts tradespeople
online; previously accessed support interest-free loan recommended by
to improve energy efficiency via to enable members of social
local council website electrification network

Maria
Older home owner
with a migrant
background. Awareness, Engagement with
Aspirations to research and marketing and support Purchase Installation
electrify and install planning opportunities
solar panels are
constrained by
upfront costs and Unaware of Not actively Lacks capital to Serious lack of trust in
distrust. alternatives at time planning to replace install solar panels solar panel retailers
of hot water system appliances and replace and installers; risk
replacement appliances aversion linked to
(“I haven’t checked limited income
what's on the (“But if I get money,
market now.”) I will change to (“If I make a mistake, I
electricity and I will don't have the
put solar panels.”) resources, being on a
Purchased a replacement gas hot pension, to wear that.“)
water system five years ago

(“without thinking”)

24 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Low interest and lack capacity

Belinda
Belinda relies on a Disability Support Pension and is paying a mortgage on a house she shares with
her adult daughter. She is a survivor of long-term domestic violence. She experiences a high level
of financial stress and struggles to pay bills. She is on a payment plan with her energy retailer to
pay off a significant debt accrued by her ex-partner. Belinda is not strongly engaged in considering
the transition away from gas, and environmental concerns are not a priority, largely due to pressing
everyday concerns about the cost of living. She is largely unaware of the support available to assist
with electrification and energy efficiency upgrades. She lacks trust in appliance retailers, but
values heating devices that provide immediate thermal comfort. Affordability is the major factor
underpinning Belinda’s energy decisions, but these decisions can backfire. For example, she has
purchased a heater with a low upfront cost but a high running cost, which is likely to be more
expensive in the long term.

(“I'd be dependent on the electricity
company themselves, to inform us
and help us. Not anyone else.”) Low purchase cost and
effectiveness at maintaining
Trust in information warm home environment
provided by energy motivated purchase of
retailers portable electric heater

Belinda
Home owner with a
mortgage.
Survivor of Awareness, Engagement with
domestic violence research and marketing and support Purchase Installation
which has led to planning opportunities
energy debt.
Struggles with
cost-of-living Not considering Unaware of support Struggling with Lack of trust in
pressures. or planning for currently available; everyday essential appliance retailers
energy use in Lacking trust in expenses, current to guide purchase
Has not been well future online information energy bills, decisions
supported by her energy debt
energy retailer.
Lack of awareness about energy costs, (“I don't even
Low environmental awareness sometimes have
enough money to
pay my gas and
Strong preference for gas
electricity as it is.”)
cooktop and hot water

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 25
6 Implications
This section discusses policy implications of our findings. These insights will be important to guide a planned, equitable transition from gas to electric homes in Victoria and other jurisdictions.

Multiple stressors Information and
Households facing barriers to knowledge electrification also experience many Support for electrification is relatively other challenges high but awareness of support
Barriers to electrification are not the only services is low challenges faced by many households in our study.
Our respondents exhibited a high level of financial There was widespread support for electrification stress, with nearly half having asked for assistance among respondents, but awareness and uptake of from friends, family or a welfare organisation and/ current programs that enable electrification were or been unable to pay bills on time in the past year. variable and generally low. For the Solar Homes
More than one in four had gone without meals, and program, awareness among home owners was more than a third had pawned or sold possessions. twice as high, and uptake three times as high, as
Other stressors, such as unemployment and among renters. Interest in information about how disabilities or chronic health conditions, were to electrify was highest among people who speak also common, and likely to exacerbate financial a language other than English at home. Better pressures. targeted information and advice, as discussed
below, provides one potential solution.
With this lack of financial capacity, spending thousands of dollars on upgrades that may take several years to pay for themselves is Lower-income households may be understandably unlikely to be a priority even if deterred by the perceived risks of these households have sufficient interest in electrification and information about electrification. Alongside specific policies to promote electrification, a Electrification was perceived as risky by comprehensive effort is needed to alleviate some respondents because the costs can be financial stress. In relation to energy, this may considerable and the changes present unknowns, include measures to lower energy prices through for example regarding an appliance’s quality, greater availability of low-cost renewables in the longevity, reliability or payback time, or the system, minimum energy efficiency standards trustworthiness of the installer or installation.
for rented homes and retail market reform. More Among renters, there was a real concern that broadly, it may involve adequate income support, upgrades to their home would trigger future rent constraining costs of living and generating rises, deterring many from raising the issue in the decent jobs. first place.
This sense of risk is magnified for lower-income
households, who lack savings to cover unexpected
events, and people facing information barriers.
Even those with a high level of environmental
concern may not be willing and able to take on
risk. This risk reinforces the status quo, with
appliances often being replaced like for like.

26 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Lowering the risk of electrification requires A trusted ‘one-stop shop’4, similar to the service addressing structural barriers, such as the split the Gas and Fuel Corporation and the State incentive problem for renters; providing financial Electricity Commission offered in Victoria in support tailored to people’s circumstances; the 1980s, could provide energy advice to guide and issuing information that acknowledges electrification and energy efficiency plans, households’ experiences (see below). facilitate access to appropriately skilled local
tradespeople, and organise related services such
More evidence-based information as energy audits. Households should be given the
option to engage in genuine conversations tailored on the benefits of electric versus to their needs, rather than simply provided with gas appliances will aid household generic advice. A one-stop shop would need to decision making be able to meet the diverse needs of households,
including those facing energy hardship.
There was considerable uncertainty among Co-designing such a service with leaders from respondents regarding the relative benefits culturally and linguistically diverse communities of upfront and running costs, reliability, safety and people in various degrees of energy hardship and environmental benefits of electric versus would be important. Our households expressed gas appliances. Despite significant gas price interest in accessing advice from physical increases in the 12 months leading up to the government-run offices, local council websites survey, there were more people who perceived and events, trusted social welfare organisations gas to be cheaper to run than electricity. and Neighbourhood Houses. They wanted advice
Clearer communication is needed around the tailored to their circumstances of energy hardship, affordability of electric appliances and the savings vulnerability or financial stress.
lower-income households could achieve from
Tradespeople, appliance retailers and energy electrification. Information about the other
retailers are also important sources of advice, benefits (environment, reliability, household
and trust between households and these groups safety) would also be helpful for household
could be improved. Some participants expressed decision making.
a lack of trust in those selling products. Through
training and, where appropriate, accreditation, it is
Trusted and tailored advisory important to develop the capacity of tradespeople, assistance is needed to help particularly electricians, plumbers and heating/
cooling technicians, to provide fair advice that households electrify assists households in the transition away from
Decisions about household energy are complex for gas. For example, the Plumbing Industry Climate everyone. Those facing major barriers to moving Action Centre provides training funded by Solar off gas have a greater need for trusted information Victoria on the installation of heat pumps for and advice. Trusted advisors are required to registered plumbers and fourth-year apprentices guide people to decide when and how to replace (Solar Victoria 2023). Such knowledge-building appliances, both as a planned investment and should complement independent sources of when appliances break down. Our findings advice such as the ‘one-stop shop’.
highlight higher trust in information from social Through regulation, governments should welfare organisations, such as BSL and Uniting; prevent gas network businesses from offering government bodies, particularly local councils; incentives and promoting new gas connections and social or cultural networks, especially for and appliances. Promoting greater gas use households speaking languages other than English runs counter to government policy, provides at home. contradictory information to households,
and ultimately risks locking households into
future vulnerability.

4 Here, we are using the term ‘one-stop shop’ to refer to a trusted, independent advice service that can assist households with electrification
planning and connect them with accredited tradespeople and other relevant service providers. This is distinct from a service that project
manages a household’s retrofit, such as the Sustainable Energy Authority of Ireland’s one stop shop.

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 27
Building energy literacy may also help lower- income households chart a path towards future
Tenure and control electrification through careful management
Home owners are better placed to and planning. A number of our participants had effective strategies for navigating the energy electrify, provided they can wait to market to manage high bills, but lacked knowledge recoup the cost or skills related to electrification.
Electrification takes time and involves investing
Energy advisory services that include financial money in home improvements. The householder considerations, particularly for energy efficiency needs to know that they are going to be in their and electrification, can build awareness about home for a long time to recoup the cost, which is both the costs and likely benefits of electrification not the case for most renters. Home ownership and their distribution over time. This can guide provides agency to make energy-related decisions about appliance replacement, both decisions, while renters typically face limited as a planned step towards electrification and in involvement or consultation in decisions made by the instance of appliance breakdown. Greater their rental provider.
resourcing of financial counsellors and energy assistance services can also assist households to navigate the complexity of the energy market, and A strategy to support renters devise strategies out of energy hardship. and rental providers to electrify
Even for energy-literate households, however, is essential the complexity and uncertainty of the energy
A low-income renter – focused strategy needs to transition exacerbate other barriers these
be better coordinated across housing and energy households face.
policy. Stronger energy efficiency standards
for rented homes and appliances should be
A plan for the future of the residential implemented to lower renters’ energy costs.
gas network will reduce uncertainty It is also important to have measures in place
to ensure that minimum standards for rental
Governments need to take a lead in developing properties do not translate into higher rents, and a clear plan for the future of the residential gas that renters’ security of tenure is protected. The network. Such a plan will assist households to Victorian Government is investing in progressively transition to electric-only homes, including by transforming community and public housing to reducing uncertainty, enabling longer-term electric-only homes, with quality appliances, but decision making about appliance purchases and much more investment is needed. This includes allowing tradespeople to provide better advice. funding upgrades for efficient heating and cooling,
Many gas fixtures (such as heating and hot water hot water systems, improving building fabric and systems) will last well over a decade, and the installing rooftop solar panels.
sooner a plan is in place, the more future expense can be avoided. Government regulation should ensure that further investment in the residential gas network does not lock in future vulnerability.

A number of our participants had effective
strategies for navigating the energy market to
manage high bills, but lacked knowledge or skills
related to electrification.

28 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
Capital and finance Rooftop solar and energy
Addressing capital barriers is vital for efficiency electrification Access to solar panels is a key step
Some of our home owner participants had high for electrification, and renters and mortgages and other debts and wanted to make lower-income households need more upgrades but couldn’t afford to do so. This led them to fall into short-term decisions in an assistance attempt to save money, rather than spending Having solar panels reduces the everyday cost of time investigating options. These home owners energy and encourages people to electrify their are likely to require financial support from homes. In our sample, ownership of solar panels government to electrify their homes. A smaller is associated with action or plans to replace group of our participants, particularly older gas appliances. However, tenure, capital and pensioners who own their home outright, had information barriers remain. The investment some savings to upgrade their homes. required to install solar panels, even with existing
Appropriate mechanisms of support could state subsidies, remains a barrier for many include grants or rebates – preferably through households who most need to reduce their bills.
programs that provide households with advice Many households also face physical barriers to and hold suppliers to safety and compliance solar installation because they live in multi-unit requirements – and, where appropriate, interest- buildings or share roofs.
free loans. Limited savings and low credit scores Renters face barriers to solar installation even if restrict access to other financing arrangements their home is suitable, due to the split incentive and potential third-party ownership schemes. problem between tenants and property owners:
Support for grants to improve energy efficiency tenants will benefit from the bill savings that come and lower energy tariffs was favoured by those from solar energy, but property owners will bear very conscious of limiting their energy use. At the upfront cost. We note that the government’s a foundational level, adequate income support Solar for Rentals program within the Solar Homes is essential, as are supplementary supports program provides a partial redress by allowing including expanded energy advisory services and rental providers to claim up to $1,400 as a rebate access to financial counselling. on the cost of the solar system and to receive
While interest-free loans have a role to play, they a matching interest-free loan. Renters are should not be seen as a panacea. Many households sometimes expected to make a co-contribution are reticent to take out a loan, particularly a to the monthly loan repayments. Low uptake of large loan, and their reticence is exacerbated by the program by renters in our sample reflected perceived uncertainties of newer technologies the difficulties of making a co-contribution and such as rooftop solar or heat pumps. coordinating with the landlord and the program
delivery agency. Greater financial incentives for
rental providers with lower-income tenants to
install solar are needed.

Appropriate mechanisms of support could include
grants or rebates – preferably through programs
that provide households with advice and hold
suppliers to safety and compliance requirements.

Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 29
Energy efficiency upgrades go hand in hand with electrification, especially for renters
Energy efficiency upgrades can help maximise the benefits of electrification by lowering energy costs, reducing the need to restrict energy use, and enhancing health and wellbeing. The poor thermal efficiency of many properties, particularly rental properties, increases the payback period for electric heating and cooling. For a number of our participants, poor energy efficiency was a driver of energy hardship, especially if they did not have the time or the skills to undertake do-it-yourself home improvements. Energy efficiency upgrades should be made widely accessible and affordable, through appropriately delivered advice, grants for upgrades and, where appropriate, no interest loans, to facilitate electrification for lower-income Energy efficiency households.
upgrades can help
maximise the benefits
Inclusive planning of electrification by processes lowering energy costs,
The voices of those facing barriers to reducing the need to electrification need to be heard and included in planning
restrict energy use,
A transition away from gas and towards electricity
and enhancing health is a large-scale, long-term planning exercise. and wellbeing.
The voices and experiences of households facing barriers to electrification must be heard in the gas transition, especially in relation to support schemes. Channels for effective participation of these households in the planning process need to be developed. Only governments are equipped to undertake this; consumer engagement by gas network businesses is not sufficient.
Governments should work through trusted agencies like consumer welfare organisations and culturally safe networks to involve communities in the planning process. This is best done locally, for example through local government, community housing bodies or Neighbourhood Houses.
Diverse models of participation will ensure perspectives of these households are included in policy development from the outset, not as an afterthought.

30 Enabling electrification Addressing the barriers to moving off gas faced by lower-income households
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Enabling electrification Addressing the barriers to moving off gas faced by lower-income households 31
Enabling electrification
Addressing the barriers to moving off gas faced by lower-income households
Sangeetha Chandrashekeran, Julia de Bruyn, David Bryant and Damian Sullivan
2023

Acknowledgement of Country
The Brotherhood of St. Laurence and the University of Melbourne acknowledge the Traditional
Custodians of the land and waterways on which our respective organisations operate. We pay our respects to Aboriginal and Torres Strait Islander Elders past, present and emerging.