By Victorian Air Conditioning Solutions

Victoria’s energy landscape is rapidly shifting — with government incentives now designed to move households away from fossil gas and towards cleaner, more efficient electric alternatives. At the heart of this transition is the Victorian Energy Upgrades (VEU) program, a state-run rebate scheme that significantly reduces the cost of upgrading to energy-efficient, all-electric systems. But how exactly is the VEU program helping Victorians make the switch away from gas by 2026, and what does that mean for your home’s energy costs and comfort? Let’s take a closer look.

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⚡ What Is the VEU Program?

The Victorian Energy Upgrades (VEU) program is a long-running initiative that helps households and businesses buy and install energy-efficient products — from reverse-cycle air conditioners to heat pump hot water systems — at a reduced cost. Participating accredited providers issue Victorian Energy Efficiency Certificates (VEECs) for each qualifying upgrade, which are then sold to energy retailers to fund your rebate.

Since the program went fully all-electric in 2023, it has delivered rebates for tens of thousands of efficient appliances, including over 19,000 reverse-cycle air conditioners and 39,000 hot water systems, saving millions of tonnes of emissions.

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🏡 Helping Households Replace Gas Systems

One of the most impactful ways the VEU program supports the gas-to-electric transition is by making it more affordable to replace old gas appliances with efficient electric alternatives.

🔄 Heating & Cooling

• If you replace a gas space heater with a reverse-cycle air conditioner, you can receive a discount through the VEU. Reverse-cycle systems provide both heating and cooling in one unit and are often cheaper to run than gas.

• Replacing an old ducted gas heater with an efficient reverse-cycle ducted system can deliver even higher rebates and annual savings on your energy bill.
  These upgrades help cut emissions and reduce long-term heating costs for Victorian homes.

💦 Hot Water Systems

• Replacing an existing gas hot water heater with a heat pump hot water system can lead to significant energy bill savings over time.

• The VEU program offers rebates that help offset the installation costs of these efficient electric systems — encouraging more households to move away from gas hot water.

🍳 Other Electrification Incentives

Recent expansions mean that even induction cooktops can receive discounts under the VEU, making electrification more attractive across multiple home systems.

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📈 Stronger Targets Ahead for 2026

The VEU program isn’t just about rebates — it’s also evolving with Victoria’s broader climate goals. The government is strengthening the VEU framework to support deeper emissions cuts and a faster move away from fossil fuels.

🧾 Program Extension and Targets

Victoria has passed amendments to extend the VEU program until 2045, aligning it with the state’s net zero emissions target. This gives households, installers, and industry confidence that electrification incentives will continue to support Victorian homes far into the future.

📊 Greenhouse Gas Reduction Goals

New emissions reduction targets for 2026 and 2027 are now set based on the number of VEECs generated — reflecting the volume of energy-efficient upgrades delivered. This helps ensure that more households adopt cleaner technologies like electric heating, cooling, and hot water systems.

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💡 Why This Matters for You

Here’s what these changes mean for everyday Victorians:

🔋 Lower Energy Bills

Electric systems like reverse-cycle air conditioners and heat pump hot water systems are typically cheaper to run than equivalent gas systems. Rebates through the VEU program help make these upgrades more accessible and affordable.

🌱 Reduced Emissions & Cleaner Homes

By encouraging households to switch from gas appliances to energy-efficient electric alternatives, the VEU program is not just cutting emissions — it’s also improving indoor comfort and lowering household environmental impact.

🛠️ Future-Proofing Your Home

With 2026 targets set and the program extended to 2045, homeowners can plan major upgrades with confidence, knowing that rebates and incentives will help reduce the upfront costs of electrification.

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🧠 Your Next Step

If you’re considering upgrading your home’s heating, cooling, or hot water system, now is an excellent time to take advantage of VEU rebates and move towards a comfortable, all-electric home. As the program continues to evolve, these incentives can help you:

✔ Slash energy bills
✔ Reduce reliance on gas
✔ Increase the value and efficiency of your home

Get in touch with Victorian Air Conditioning Solutions today to see how much you could save with VEU rebates and to plan your electrification upgrade before 2026.