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Best Energy Upgrades for Victoria Homes in 2026

Based on a typical 3-bedroom home in Victoria · Updated June 2026

Victoria has the highest gas consumption per home of any state, driven by cold winters and a historically gas-heavy appliance stock. The Victorian Energy Upgrades (VEEC) scheme dramatically reduces upfront costs for heat pumps and draught sealing, making gas-to-electric switching one of the strongest financial moves available -- often second only to solar.

What we modelled — how we calculated these results

3-bedroom home, ~18 years old
State: VIC
Electricity: 29c/kWh
Feed-in tariff: 3.3c/kWh
Gas: 3.8c/MJ
Gas usage: ~52,586 MJ/year
Electricity usage: ~2,672 kWh/year
Analysis period: 15 years

Recommended upgrade sequence

These upgrades are ordered for maximum return. Each step accounts for the energy changes made by previous steps.

1

Heat Pump Hot Water (gas switch)

Pays for itself in 7.2 years, then saves ~$353/year.

$546
Profit
Net cost
$2,915
Payback
7.2 yrs
15yr savings
$7,378
2

Electric Vehicle

Pays for itself in 5.6 years, then saves ~$1,186/year.

$379
Profit
Net cost
$9,000
Payback
5.6 yrs
15yr savings
$15,053
3

Solar + Battery

Pays for itself in 7.4 years, then saves ~$1,715/year.

$692
Profit
Net cost
$13,822
Payback
7.4 yrs
15yr savings
$29,124
4

Reverse Cycle Heating

Pays for itself in 2.3 years, then saves ~$1,068/year.

$7,690
Profit
Net cost
$2,470
Payback
2.3 yrs
15yr savings
$21,481
5

Induction Cooktop

Pays for itself in 3.3 years, then saves ~$180/year.

$2,924
Profit
Net cost
$1,660
Payback
3.3 yrs
15yr savings
$9,685

Portfolio summary

$29,867
Total investment
$82,720
Total savings (15yr)
$12,231
Net profit

Below market returns at this time horizon

These upgrades still save money on energy bills, but the return doesn't beat the 10% stock market benchmark over 15 years. They may become worthwhile with a longer holding period.

Draught Sealing
Below benchmark by $44
Smart Home Energy Management
Below benchmark by $177
Insulation
Below benchmark by $389
Battery (add-on)
Below benchmark by $7,438

Frequently asked questions about Victoria energy upgrades

What is the best energy upgrade for a Victoria home?▾
For a typical 3-bedroom home in Victoria, Heat Pump Hot Water (gas switch) is the highest-return upgrade with a net profit of $546 over 15 years and a payback period of 7.2 years.
How much can I save on energy bills in Victoria?▾
By following the full recommended upgrade sequence, a typical Victoria home could save $82,720 over 15 years, with a total investment of $29,867 and a net profit of $12,231.
What electricity rate does Victoria pay in 2026?▾
We modelled Victoria homes at 29c/kWh with a feed-in tariff of 3.3c/kWh, based on current VIC retail rates. You can adjust these in the calculator to match your actual plan.
What order should I install energy upgrades in Victoria?▾
The optimal sequence is: 1. Heat Pump Hot Water (gas switch), 2. Electric Vehicle, 3. Solar + Battery, 4. Reverse Cycle Heating, 5. Induction Cooktop. Each step is calculated after accounting for the energy changes from previous upgrades, so the order matters.

See what the calculator recommends for your home

These results are for a typical home. Your savings depend on your actual energy usage, roof orientation, and appliance ages.

Run the calculator for your home

Examples for other states

New South WalesQueenslandSouth AustraliaWestern AustraliaTasmaniaAustralian Capital Territory

Related reading

Solar Panels in Australia: Cost and Savings in 2026Should You Just Ditch Gas Entirely? A State-by-State LookHeat Pump vs Gas Hot Water in Australia: 2026 Numbers