Victorian household gas use falls 26% as connections grow

Victorian gas distributors have released monthly, postcode-level usage and connection data pursuant to a 2026 Ministerial Order. According to John Godfrey, the Victorian Energy and Fairness Network facilitator, all three distributors published the same five tables on 28 and 29 October.

The dataset covers approximately 2.25 million residential connections across the state.

Consumption vs Connections

Victorian Energy and Fairness Network (VEFN) data reveals a diverging trend in state gas networks. From 2020 to 2025, household gas use fell by 26%. After applying weather corrections to account for temperature variations, the VEFN calculated a 22% decline over the same period.

While total usage dropped, the number of active residential connections increased. VEFN figures show a 4% growth in connections between January 2023 and June 2026.

According to the Institute for Energy and Environmental Finance Australia (IEEFA), more than 190,000 Victorians switched to electric appliances since 2023. Shadow energy minister David Davis introduced the Domestic Gas Choice (Repeal of Gas Appliance Ban) Bill 2026, which addresses regulatory frameworks for appliance selection.

The Dormant Gap

• Residential links inactive for extended periods increased by 62% in June 2026, reaching 66,700 from a baseline of 41,200 in January 2023 (VEFN).
• VEFN facilitator John Godfrey said: By June 2026, 66,700 households had not utilized gas for at least a year, yet merely 32,900 connections were permanently severed since January 2023.
• The annual rate of gas connection abolitions stands at roughly 11,000 and is trending upward (VEFN).
• The dormant connection metric omits permanent abolitions while encompassing empty dwellings and reconstruction sites.
• Switching appliances has resulted in a total savings of $185 million on energy expenditures (IEEFA).

Market Shifts and Drivers

Momentum behind new gas infrastructure has reversed sharply. VEFN data reveals that first-half new residential connections declined by 30%, dropping from 21,200 in 2023 to 14,700 in 2026.

This slowdown is compounded by Multinet disconnections surpassing new connections since 2025. Tim Baxter of Nauru Research verified that during 2025-26, more Victorian households left the gas network than joined it for the first time. Baxter cited a mix of drivers for this consumer behavior, including individual preferences, government incentives, and rapidly rising retail gas prices.

This trend unfolds while Victoria represents 60% of total Australian residential gas consumption.

Regulatory Origins and Political Stakes

The mandatory reporting framework stems from state Labor’s Gas Substitution Roadmap, established under former energy minister Lily D’Ambrosio in 2022. Baxter attributes this early shift to consumer choice, government incentives, and skyrocketing retail gas prices, describing the data as a "parting gift" from D’Ambrosio.

Jaclyn Symes, D’Ambrosio’s successor as state energy minister, has vowed to take the Gas Substitution Roadmap to the vote unchanged despite targeted industry lobbying. Conversely, the Coalition opposition aims to undo the connection and appliance replacement rules through the Domestic Gas Choice (Repeal of Gas Appliance Ban) Bill 2026, seeking to "restore household choice" for cooking, heating, and hot water.

Baxter warns that gas networks risk a "death spiral" where the full cost of maintaining increasingly useless infrastructure is lumped on vulnerable consumers. He highlights that Victoria’s gas fields are "all but gone." He argues that regulators must intervene to prevent disproportionate costs for those least able to pay while assisting them in electrifying their homes.

Estate-Driven Growth and Network Dynamics

VEFN analysis attributes roughly two-thirds of the 4% rise in active residential connections to "a dozen estate postcodes." In contrast, "like for like" first-half new connections fell 30%, while 12,100 connections were disconnected in 2026. The report notes that 10 postcodes supply two-thirds of AusNet’s new connections and half of AGN’s. Nauru Research’s Tim Baxter described the data as a "parting gift" from former energy minister Lily D’Ambrosio, noting that disconnection momentum has built well before the January 2027 ban.

What to watch

The state’s gas connection ban for new homes and most commercial buildings takes effect in January 2027. Following that, regulations requiring the replacement of end-of-life gas hot water systems begin in May 2027. Meanwhile, no timeline has been provided for when the state’s gas fields will be fully depleted.