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Why most heating advice gets it wrong
Most heating guides hand you a list of heater types and a vague "it depends". They treat a plug-in electric heater, a gas heater and a reverse-cycle aircon as roughly comparable options with different price tags. They aren't comparable at all. They differ by a factor of four or more in running cost, and that single fact should drive the whole decision.
The other thing the guides cling to is the old line that "gas is cheaper for heating". That was true years ago. It quietly stopped being true as gas prices climbed and the daily gas supply charge piled up, but the assumption lingers and steers people toward the wrong system. If you only remember one thing: heat that gets moved beats heat that gets made, every time.
How heating costs actually work
The cost of heating comes down to one idea: how much warmth you get per dollar of energy. That's where the heat source matters enormously.
Made heat vs moved heat
A resistive electric heater (the cheap plug-in kind) turns power straight into heat, one for one. A 2,400 watt heater draws 2.4 kilowatts the entire time it's on. A reverse-cycle air conditioner doesn't make heat, it moves it from the outside air indoors, so it delivers three to five units of warmth per unit of power. Same comfort, a quarter of the electricity. Gas sits in between: it burns fuel at maybe 80% efficiency, so it always gives less than one unit of heat per unit of energy bought, and the gas price plus the daily supply charge now push it above reverse-cycle on cost.
When and where you heat
On a time-of-use tariff, the evening (typically 3 pm to 9 pm) is both when you most want heat and when power costs the most. Heating a sealed, occupied room rather than the whole house, and warming up earlier where you can, keeps that load out of the dearest window. Draughts and poor insulation quietly multiply every dollar, because the heat you pay for leaks straight out.
Heating cost by source: see the gap
This calculator costs the same amount of heat delivered three ways: reverse-cycle, gas, and a plug-in electric heater. The gap is the price of choosing the wrong heat source. Every figure also appears in the worked example below.
Heating running cost by source
Same heat delivered, per winter. Edit any input.
Gas assumed 80% efficient; 1 kWh of heat = 3.6 MJ. Reverse-cycle cost = heat ÷ COP × rate. Excludes the daily gas supply charge, which widens the gas gap further. Rates are editable defaults, not your plan.
Worked example (the calculator's default). 3 kW of heat, 6 hours a day for 100 winter days, electricity 30 c/kWh, gas 4 c/MJ:
| Heat source | Energy used | Cost for the winter |
|---|---|---|
| Reverse-cycle aircon (COP 4) | 450 kWh | ~$135 |
| Gas heater (80% efficient) | 8,100 MJ | ~$324 |
| Plug-in electric heater | 1,800 kWh | ~$540 |
Same warmth. The plug-in heater costs four times the reverse-cycle, and gas more than double, before you even add gas's daily supply charge.
How Aussies overpay without realising it
A $60 column heater feels harmless. Run it all winter and it's the most expensive heat in the house, quietly adding hundreds to the bill.
Plenty of homes keep firing the ducted gas because "gas is cheaper", an assumption that expired years ago while the bills kept coming.
Warming the whole house to sit in one room is the same waste as cooling it. Heat the room you're in, shut the door.
Gaps under doors and around windows leak the heat you paid for. No heater is efficient if the warmth walks straight out.
The insider insight: you probably already own the cheapest heater
Here's what rarely gets said plainly. Most Australian homes that bought a reverse-cycle air conditioner for summer are sitting on the cheapest heater they'll ever own, and never use it as one. The split system on the lounge-room wall, flicked to heating mode, makes warmth for roughly a quarter of what the plug-in heater costs and beats the ducted gas it's parked next to.
The reason this stays hidden is partly mental: we file the aircon under "cooling" and reach for something labelled "heater" in winter. And partly historical: the gas-is-cheaper rule of thumb was true long enough to stick. The physics flipped, the habit didn't. The household that simply switches the existing reverse-cycle to heat, instead of buying or running anything else, makes the single biggest winter saving available, for nothing.
What you should actually do
| Do this | Why it works |
|---|---|
| Use your reverse-cycle aircon for heating | Three to five times more heat per dollar than gas or a plug-in heater. |
| Retire the plug-in electric heater for daily use | It's the dearest heat there is; keep it for quick spot warmth only. |
| Set 18–20°C and heat occupied rooms | Each degree higher adds 5–10%; heating empty rooms is pure waste. |
| Seal draughts and close doors | Stops the heat you paid for leaking out, which makes any system cheaper. |
| Warm up earlier on time-of-use, not in the peak | Keeps heating load out of the priciest evening window. |
| In VIC, NSW, SA, QLD, ACT: compare plans against the DMO/VDO | A better rate lowers the cost of every heating hour. |
In Western Australia (Synergy) and the Northern Territory (Power and Water) there's no retailer to switch to, so the heat source and how you run it are your levers. See our heating savings guide for the behaviour wins, and heating and cooling for the year-round case.
Why this matters right now
With gas staying dear across the eastern states and more homes on time-of-use tariffs, the cost of heating the old way keeps climbing while the reverse-cycle option only looks better. This is the winter to stop making heat and start moving it.
The takeaway: the cheapest heater in your house is probably already on the wall. Switch it to heat, warm the rooms you use, seal the draughts, and you've cut the biggest winter cost without spending a cent.
Frequently asked questions
Current figures — last updated 2026-06-13
All values in AUD and Australian units. Volatile figures change; check your own plan before relying on them.
| Reverse-cycle heating efficiency (COP) | 3–5 units of heat per unit of power |
|---|---|
| Resistive electric heater efficiency | 1:1 (1 unit of heat per unit of power) |
| Gas heater efficiency | ~80% (plus a daily supply charge) |
| Recommended winter set point | 18–20°C |
| Energy change per degree | ~5–10% per °C |
| Typical electricity rate | ~25–35 c/kWh [verify: your plan] |
| Typical gas rate | ~3–5 c/MJ [verify: your plan] |
| Reference price (NSW, SA, SE QLD / VIC) | AER DMO / ESC VDO [verify: current value] |
Sources: energy.gov.au, Australian Energy Regulator (DMO), ESC Victoria (VDO), manufacturer specifications.