South Australia leads the country, and the world, in the uptake of rooftop solar – but it seems that builders are still locking 60 per cent of new homes in South Australia into the fossil gas network, despite falling gas demand and in the face of thousands of dollars of new connection costs.
The new finding by the McKell Institute, a think tank, highlights a bizarre situation for a state which has been at the bleeding edge of rooftop solar tech for years.
More than half of the state’s homes have rooftop solar, and the output from these PV generators regularly accounts for 100 per cent or more of state electricity demand, forcing networks to innovate on integration technology and ideas.
And yet it is struggling to kick fossil gas, according to the McKell Institute’s new paper Connecting to gas is changing; so should SA’s planning laws.
“Changes to gas pricing mean the economics of household connections are shifting,” said the McKell Institute’s Hannah MacLeod.
“Planning laws need to change to align with current market conditions and household preferences.
“Updating planning settings to make gas connections opt-in, rather than default, would give homebuyers clearer choices and help them avoid unnecessary costs.”
The problem is that gas demand is falling by 5.5 per cent in every household across the state, every year, according to estimates by Australian Gas Networks.
But a rule change last year means that from October gas connection fees of around $4,500 in South Australia will be charged directly to every buyer of a new home rather than socialised across gas networks – whether they want the gas or not.
Add in the cost of including separate infrastructure to run gas in a house in addition to electricity, and the paper estimates that gas is set to add an extra $8000 to the price of a new build home – money that could have been spent on solar panels and a battery.
More than a quarter of South Australians say they plan to quit gas over the next decade, the paper says, driven by the fact that dual-fuel bills add an estimated $700-$1,200 more per year, according to an Energy Consumers Australia survey in 2024.
MacLeod and her co-author, economist Thomas Probst, say South Australia’s planning rules make gas the default utility for homes, rather than a choice.
They want the South Australian government to move in the same direction as Victoria already has done, although still offering gas as a choice.
Victoria outright banned gas from new build houses and apartments in 2024 and mandates old gas appliances in rentals be replaced with electric from 2027.
“For example, the Guide to the Planning and Design Code is explicit that infrastructure policies seek to ensure development is provided with “electricity, water and gas supply” alongside drainage, stormwater systems, roads and telecommunications,” MacLeod and Probst write.
“That framing sets the default mindset for how assessing authorities, designers, and developers approach servicing.
“Gas is treated as an essential service and part of the standard utility set, not as a discretionary addon.”
Unlike Victoria, the ACT and New South Wales, South Australia is not talking at all about swapping domestic gas for electricity, MacLeod told Renew Economy.
“The conversation is not happening,” she says. “But people are moving away from gas anyway. It’s not mandated, it’s not being incentivised, but people are moving away anyway.”
And the Labor-led South Australian government is not considering any changes, according to a statement reported by The Advertiser which said gas is not mandatory and emphasised the government is “committed to a fully operational gas network for residential, commercial and industrial sectors.”
But without a change in policy, gas connections can be mandatory because current guidelines give housing estate developers the power to make ths choice, MacLeod and Probst point out.
The design guidelines for a housing development called Springbrook in the Adelaide Hills say each house must have gas hot water, either gas heating or a gas cooktop, and if the owner wants a solar hot water system they also need a gas boosted system as well.
“Springbrook is providing reticulated LPG with Australian Gas Networks throughout the development. A gas connection will be provided to the front of each allotment. It will be mandatory that each house connects to the LPG system,” the 2020 development guidelines say.
The developer, Springlake Communities, claims to promote sustainable building.
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