Energy retailer offers rebates to help customers say goodbye to fossil gas

A major Australian energy retailer is urging its tens of thousands of residential gas customers to quit the fossil fuel, in a deal that offers to wipe the gas network disconnection cost and connect households to a specialist, end-to-end electrification advisor.

Momentum Energy, the mainland-based retail arm of state-owned generator Hydro Tasmania, said this week that it has partnered with Melbourne-based outfit Goodbye Gas to help its customers to go all-electric.

The “entirely voluntary” program – pitched at Momentum’s roughly 70,000 gas customers in Victoria – promises to cover the gas abolishment fee of $242 for customers who work with Goodbye Gas to fully electrify their homes.

That is, Momentum gas customers based in Victoria who purchase any product from Goodbye Gas, such as a heat pump, and then “decide to go the whole nine yards” and remove the gas meter will have the gas abolishment fee credited to their final gas bill.

“It might seem strange for a gas retailer to be incentivising its own customers to transition away from gas, but Momentum wants to see more of our customers living fully electric lives,” said Momentum’s managing director Lisa Chiba.

“Going all-electric – particularly when it’s combined with adding solar panels – is one of the most impactful changes individual consumers can make to help the planet.”

It can also be a great way to make a dint in energy bills. According to Rewiring Australia, the average running costs of gas and petrol homes is $5,300 per year, while an electrified home with rooftop solar has running costs of about $1850 per year.

But while the health, economic and environmental benefits of going all-electric are increasingly compelling – and increasingly well known – the process can be complex, overwhelming and expensive – even for people with existing know-how.

This is where Goodbye Gas comes in. As director Peter Steele puts it, the company works with homes wishing to transition away from gas, from the initial consult right through to making sure the trades “turn up on time and take their boots off.”

This process includes setting up and quoting a tailored electrification plan, navigating the range of rebates and incentives on offer, guiding the selection of products and installers and offering households a single point of contact between them and the various trades involved.

“We handle all the hard parts,” says Steele – which more recently extends to a finance offer to help people get together the money to pay for the new appliances.

Steele says the level of understanding people have about going electric in their homes “varies massively,” from people who are incredibly knowledgeable to those who don’t know what a heat pump is.

“I’ve spent most of my career in sustainability consulting in one form or another and it’s interesting the number of people in that world who have said… ‘I went through this and did it myself …and it’s quite difficult!’

“So it’s no small thing,” he says.

“I think the common thing that we see with our customers is that they they made the conceptual decision that they want to do it, so they might not necessarily need a heap of convincing.

“But they’re trying to wade through all of the technical and installation complexity that goes with it.

“They’re trying to understand … the difference between heat pump options or, you know, trying to figure out how to fit an induction cooktop into their bench top without having to cut it.

“And then … even if they get past that first hurdle, then they don’t necessarily have a network of trades that they can trust to do the work well.

Steele says having a mid-sized retailer actively encouraging its customers to switch from gas is “a significant development” and removes yet another potential speedhump to the process.

“I do want to give Momentum the credit they deserve for really being proactive in this sense,” he tells One Step Off The Grid.

“The idea of the abolishment [fee] rebate was one that Momentum came up with – and we thought it was a really neat way to show that the retailer was genuine in its intention to help customers to go on this journey and … actually removing the gas connection.”

Steele says the Australian Energy Regulator decision last June, to set a fixed exit fee for Victorian customers wishing to abolish their connection to the reticulated gas network, had made this kind of offer easier for retailers to make.

Before this determination, numerous households had reported being quoted eye watering fees of nearly $1,000 or more for the service, depending on their location on the network.

As the AER noted in its determination at the time, such high costs had led to many households opting simply to close off the supply of gas at the meter – a potentially unsafe option that also kicks the can down the road on the inevitable cost of doing the job properly in the long term.

Adding to the push away from gas in Victoria has been the state government ban on connections in new homes and government businesses, which came into play at the start of 2024.

Victoria has been Australia’s biggest user of gas in households, particularly for home heating.

Last year, an Environment Victoria report found that an average home in Melbourne’s south-east using gas for heating over the winter months of June, July and August can expect to pay a total of around $716 to keep warm.

The report, based on modelling by Renew, also found that households in the state could save hundreds of dollars – or up to 75% – on their winter heating bills by switching from gas to an efficient electric heat pump.

But has the energy retailing industry, more broadly accepted that electrification of everything is where household energy supply is headed? Again, says Steele, this varies a lot.

“There’s a spectrum across the retailers… I haven’t seen another retailer be as proactive around this as [Momentum] have – I think that’s a that’s a really great step.

“For me, it seems inevitable and it seems like the retailers… will need to figure out how they help customers to electrify, and then how to … bring the tariff structures and the you know, the other things that make up their product that helped them maximise the benefits of electrification.

“As a business Goodbye Gas is focused on getting the right equipment in place and helping customers to do that as efficiently as possible.

“Electrification delivers an enormous opportunity, but also you know, a necessity for retailers to then bring the right products in their world that marry up to that and make the most of all those efficient electric homes,” Steele says.

In the meantime, the decision to shift from gas to electric might be made a little easier for some by Momentum Energy’s partnership with Goodbye Gas.

“This is an entirely voluntary program and we will continue to support our customers who keep using gas,” says Chiba.

“But given the long-term shift to decarbonise the grid, the argument for electrification will get even stronger as this becomes a reality.”