Gas prices are rising as global conflicts tighten supply and expose Australian households to volatile international markets.
But millions of renters remain locked into using gas, even though cheaper electric alternatives like heat pump hot water systems are easily available. The barrier is a split incentive – landlords pay for appliances that tenants have to use.
Harry Barber from Electrify Yarra is calling on the Treasurer to use the upcoming budget to fix that, by extending instant tax write-offs to landlords for heat pump installations. He argues this would bring landlords into line with small businesses and unlock investment in rental properties.
Without that signal in the budget, the shift to cheaper, cleaner energy risks leaving renters behind as the energy transition ramps up.
The Grattan Institute’s Getting off gas: why, how, and who should pay? report also recommended the government should “provide an instant asset write-off for landlords for the cost of new electric appliances replacing gas ones” to help overcome the upfront cost barrier of switching from gas to electric appliances.
Their modelling suggests an instant asset write-off would meet between 23 and 55 per cent of the cost gap for water heaters.
You can hear an interview with the Grattan Institute’s Program Director for Energy & Climate Change, Alison Reeve, on a previous SwitchedOn Australia episode.
