The short answer
How to reduce your gas bill starts with where the money goes
Search how to reduce your gas bill and you will find the same listicle every time: turn the heating down, take shorter showers, block the draughts. Those tips are real, but they share a blind spot. Almost every gas bill carries a fixed daily supply charge of around 70 c to $1 a day, roughly $300 a year, that you pay before you burn a single megajoule. Behaviour shrinks the usage charge; it never touches that standing charge. So the largest saving for many Australian homes is not a shorter shower, it is structural: switching heating and hot water to efficient electric appliances and, where it stacks up, disconnecting gas entirely to remove the supply charge for good. This page explains where your gas money actually goes, how the bill is calculated, and which moves are worth the effort.
Here is the core takeaway in one line: behaviour cuts your gas usage, but only going all-electric and disconnecting gas removes the fixed daily supply charge, which is why the biggest saving is usually structural, not behavioural. Lowering the thermostat by 1 degree saves roughly 10% of heating, and shorter, more efficient hot water plus draught-proofing add more on top. Yet none of it touches the standing charge you pay just to stay connected. So the right question is not "which tip saves the most?" but "is the supply charge or my usage the bigger problem?" Everything below shows you how to read the bill, how it is calculated, and which move actually fits your home.
Reframe the assumption: a "10 tips to save on gas" list treats your bill as one pool of waste you can trim. It is not. Part of it is a fixed daily charge that no behaviour removes, and part of it is usage that behaviour does reduce. Read the split on your own bill first, because it decides whether a shorter shower or a heat-pump is the smarter spend.
The blind spot
Why most gas-saving guides quietly mislead you
Most articles on how to reduce your gas bill do one of three unhelpful things, and each one costs readers money.
First, they overstate behavioural savings. A "10 tips" list implies that if you do all ten, your bill collapses. In reality those tips only act on the usage portion of the bill, and the savings overlap: once the heater runs less, draught-proofing has less heat to save. The headline percentages do not stack the way the lists imply, so the real reduction is smaller than promised.
Second, they ignore the fixed supply charge floor. Every bill carries a daily supply charge of around 70 c to $1 a day, roughly $300 a year, before any usage. For a low-gas-use home, this standing charge can be the single largest line on the bill, and no shorter shower or lower thermostat removes a cent of it. A guide that never mentions the supply charge is hiding the one number that decides whether saving is even possible.
Third, they skip how the bill is actually calculated. They tell you to "use less gas" without explaining that you are billed in megajoules, not in the cubic metres your meter reads, and that the conversion uses a heating value. Without that, you cannot judge which appliance is the real cost or whether the usage rate or the supply charge is your problem. Understanding the calculation is what turns generic advice into a decision that fits your home.
How an Australian gas bill really works
Expert analysis: where your gas money goes
Heating, hot water and the fixed daily supply charge
A gas bill splits into two parts. The usage charge is the gas you burn, and in a heated home it is dominated by space heating, with hot water a clear second and cooking a distant third. Gas use runs about two to three times higher in winter than summer because of heating. The supply charge is a fixed daily amount, around 70 c to $1 a day, that you pay regardless of usage. Think of it like a gym membership: the daily fee applies whether you turn up or not, and the more you use the appliance, the more the membership earns its keep. That split is the key to every saving decision below.
Why the daily supply charge punishes low users
The fixed supply charge is the same whether you burn a lot of gas or almost none, so it lands hardest on light users. Spread roughly $300 a year of supply charge across a household that uses very little gas, and the effective rate per MJ becomes punishing: you are paying a large standing fee to access a small amount of energy. For a home that has already moved cooking and hot water off gas and only keeps a gas heater for a few weeks of winter, the supply charge can cost more than the gas itself. This is the single most important fact a generic tips list leaves out, because it flips the answer from "use less" to "leave entirely".
What heating value is and how the MJ conversion works
Your meter measures volume in cubic metres (m3), but your bill charges energy in megajoules (MJ = megajoule, a unit of energy). The retailer bridges the two with a heating value, which is the energy contained in each cubic metre of the gas delivered to your area, plus a small correction factor for pressure and temperature. The sum is simple: volume in m3, multiplied by heating value, multiplied by correction factor, equals MJ. As a rough guide, 1 m3 of natural gas is about 38 to 39 MJ. Heating value is just the energy density of the gas, the same idea as octane in petrol: the same volume can carry slightly more or less energy depending on the supply.
Gas is not under the DMO, so the plan matters
Electricity has a safety-net reference price, the Default Market Offer set by the Australian Energy Regulator (and the Victorian Default Offer set by the state). Gas has no equivalent cap. That means an uncompetitive gas rate is not reined in by any reference price, so the plan you are on matters more than people assume. Gas retail competition exists in the eastern states, Victoria, New South Wales, South Australia, Queensland and the ACT, where you can compare and switch retailers. In Western Australia and the Northern Territory the market works differently, so the comparison advice does not carry over. If you are keeping gas, comparing plans in a competitive state is a saving the tips lists never mention.
Interactive explainer
Estimate what each move saves on your gas bill
Set your quarterly gas bill and tick the measures you would take. The estimator shows an illustrative annual saving, and it makes clear that only going all-electric removes the fixed supply charge.
Your quarterly gas bill:
Illustrative annual saving
$/year (illustrative)
Tick the measures above to see what you could save.
Illustrative only, not a quote. Assumptions: annual bill is four times your quarterly figure; of the usage portion, heating is taken as 60% and hot water as 25% of the annual bill; the fixed supply charge is taken as $300 a year. Behaviour percentages: thermostat around 10% of heating, hot water around 12%, draught-proofing around 7% (the last two are indicative and marked for verification). Going all-electric removes the supply charge and all remaining gas usage, but does not include appliance or disconnection costs. Sources: Canstar Blue 2026, AER, AEMC.
| Measure | Indicative saving | What it acts on |
|---|---|---|
| Lower the thermostat by 1 degree | Around 10% off heating | Heating is usually the biggest gas use in winter, so a small set-point change compounds across the season. |
| Shorter or efficient hot water | Around 10 to 15% off hot water [verify] | Shorter showers and a water-efficient showerhead cut the second-largest gas load. Indicative range, varies by household. |
| Draught-proofing | Around 5 to 10% off heating [verify] | Sealing gaps around doors, windows and unflued vents keeps heated air in, so the heater runs less. |
| Disconnect gas, go all-electric | Removes ~$300/year supply charge + all gas usage | Reverse-cycle air conditioning for heating and a heat-pump hot water system replace gas, then disconnecting ends the daily supply charge entirely. |
What this looks like in real homes
Where Australian households win or lose the saving
The split between usage and supply charge is not theory. It is exactly what decides whether a household saves real money or chases the wrong fix:
The heavy-heating home that wins on behaviour
A cold-climate home in regional Victoria heats with gas all winter, so heating is the bulk of a large bill. Here behaviour genuinely pays: dropping the thermostat 1 degree, draught-proofing and zoning the heating to occupied rooms shave a meaningful slice off a big usage charge, because there is so much usage to act on.
The light-use home that loses to the supply charge
An inner-city flat cooks with gas and little else. The usage charge is tiny, so the roughly $300 a year supply charge dwarfs the gas itself. Shorter showers change almost nothing here, because there is barely any usage to cut. The real saving is disconnecting gas and moving cooking to an induction cooktop.
The home that switched hot water but kept the connection
A household installed a heat-pump hot water system and felt good about it, but left the gas connected for a single space heater. They now pay a full supply charge for a few weeks of heating a year. Finishing the job, moving heating to reverse-cycle air conditioning and disconnecting, captures the saving they half-made.
The home on an uncompetitive plan in the eastern states
A New South Wales household keeps gas for good reason but has not compared plans in years. Because gas is not price-capped, their rate has drifted high. A switch to a competitive retailer cuts the usage charge without changing a single habit, a saving the tips lists never raise.
The insider insight
The biggest gas saving is usually leaving gas behind
Here is the part the tips lists never reach. Behaviour is capped by design: you cannot lower the thermostat below comfort, and you cannot take a negative-length shower. Every behavioural saving acts only on the usage charge, and it shrinks as you optimise, while the fixed supply charge sits there untouched. The largest lever, for most homes, is structural: replace gas heating with a reverse-cycle air conditioner (which delivers several units of heat per unit of electricity), replace gas hot water with a heat-pump hot water system, then disconnect gas to remove the daily supply charge entirely.
The non-obvious Australian truth: for a low-gas-use home, the cheapest gas bill is no gas bill. Because the supply charge is fixed, the less gas you use the worse your effective rate per MJ becomes, so the home that has already moved most loads off gas is exactly the home that should disconnect. Behaviour is the right answer for a heavy-heating home with lots of usage to trim; going all-electric is the right answer for a light user paying $300 a year to keep a connection it barely uses. Match the move to your split, do not just run the generic list.
The practical consequence: do not treat saving as a single tactic. Read your bill, find your split, then either trim a large usage charge with behaviour or remove the supply charge with a structural switch. Check state efficiency schemes such as the Victorian Energy Upgrades program for rebates on efficient electric appliances before you commit.
Grounded in the analysis
What you should actually do to reduce your gas bill
Specific moves that follow from how the bill is built, not a generic top-ten list.
Read the split on your bill
Before anything else, find the supply charge and the usage charge on your latest bill. If the supply charge is the larger share, no behavioural tip will help much, and you should weigh going all-electric. If usage dominates, behaviour is worth the effort.
Trim usage where there is usage
For a heavy-heating home, lower the thermostat by 1 degree (around 10% off heating), draught-proof, zone the heating to occupied rooms and take shorter showers. These act on the usage charge, so they pay off most when usage is large.
Go all-electric to kill the supply charge
For a light user, move heating to reverse-cycle air conditioning and hot water to a heat-pump system, then disconnect gas to remove the ~$300/year supply charge. Check state efficiency schemes for rebates and weigh the upfront cost against your stay.
Not sure what is normal for your home? See the average gas bill in Australia, learn how a gas bill is structured, or estimate your own use with the gas usage calculator before you decide which move fits. Once your usage is trimmed, our guide to finding the cheapest gas helps you lock in a sharper plan.
Current figures, last updated 2026-06-15
Australian gas figures for 2026. Sources: Canstar Blue 2026 bill averages, the Australian Energy Regulator (AER), the Australian Energy Market Commission (AEMC) and state efficiency schemes such as the Victorian Energy Upgrades program. Confirm current rates on your own bill, as figures vary by state, distributor and plan and are reviewed regularly.
The bottom line
Why this matters right now
Gas prices keep climbing and efficient electric appliances keep improving, so the calculation that once favoured staying on gas is shifting for more homes each year. The move that decides your bill is not which tip you pick from a list, it is reading the split between your fixed supply charge and your usage, then matching the fix to it. A heavy-heating home trims a large usage charge with behaviour; a light user removes a $300-a-year supply charge by going all-electric; an eastern-state home keeping gas compares plans because there is no price cap to protect it. Do the one that fits your home, not the one the listicle ranks first, and the saving sticks.
Common questions
A Selectra expert answers your gas saving questions
Three things drive a high gas bill. First, the fixed daily supply charge of around 70 c to $1 a day (roughly $300 a year) is on every bill before you use any gas, so if your usage is low the supply charge can be the larger share. Second, winter heating: gas use is typically two to three times higher in winter, and heating is usually the single biggest load in a heated home. Third, your plan: gas is not capped by the Default Market Offer, so an uncompetitive rate sits there unchecked. A high bill is usually heating plus the standing charge, not waste you can simply switch off.
Your meter measures the volume of gas you use in cubic metres (m3), but you are billed in megajoules (MJ = megajoule, a unit of energy). The heating value converts that volume into energy: it tells you how much energy is in each cubic metre of the gas delivered to your area. The bill multiplies your metered volume by the heating value and a small pressure or temperature correction factor to get MJ. As a rough guide, 1 m3 of natural gas is about 38 to 39 MJ. Think of heating value as the energy density of the gas: the same volume can carry slightly more or less energy depending on the supply.
The national average gas bill is around $229 a quarter, roughly $900 a year, which works out near $75 a month, though most homes use far more gas in winter than summer. The state range is wide: from about $142 a quarter in Western Australia to about $285 a quarter in South Australia. Your own monthly figure depends on whether you heat with gas, how cold your winters are, and the daily supply charge on your plan. Figures are Canstar Blue 2026 averages; check your own bill for the exact split between supply charge and usage.
A gas bill has two parts. The supply charge is the fixed daily amount (around 70 c to $1 a day) multiplied by the number of days in the billing period. The usage charge is your energy use in megajoules multiplied by the usage rate (around 3 to 5 c/MJ, which can step down at higher volumes). To get your MJ, the retailer takes your metered volume in cubic metres, multiplies by the heating value and a correction factor (so 1 m3 becomes about 38 to 39 MJ), then totals it. Add supply plus usage, apply GST, and that is your bill. Knowing the split tells you how much behaviour can actually save.
Start by reading your bill to see the split between the fixed supply charge and usage. If usage is the bigger share, behaviour pays off: lower the thermostat by 1 degree (around 10% off heating), take shorter showers, fit a water-efficient showerhead and draught-proof the home. If the supply charge is a large share because your gas use is low, the bigger win is structural: move heating to reverse-cycle air conditioning and hot water to a heat-pump system, then consider disconnecting gas to remove the supply charge entirely. In the eastern states (VIC, NSW, SA, QLD, ACT) you can also compare gas plans, because gas is not price-capped.
For many homes, yes, especially low-gas-use households paying a full supply charge for little usage. A reverse-cycle air conditioner delivers several units of heat per unit of electricity, and a heat-pump hot water system is far more efficient than a gas storage unit, so the running cost can fall even before you account for the saved supply charge. Disconnecting gas then removes around $300 a year you were paying just to stay connected. The catch is upfront cost: appliances and a disconnection fee. Check state efficiency schemes such as the Victorian Energy Upgrades program for rebates, and weigh the payback against how long you will stay in the home.
