Reverse Cycle AC vs Gas Heating: Which Is Cheaper?
Quick Verdict
Reverse cycle AC is now cheaper to run than gas heating in most of Australia, thanks to improved efficiency (COP 4-5) and rising gas prices. It also cools in summer. Gas may still suit very cold climates (Canberra, Hobart, alpine) for heating large spaces quickly.
Side-by-Side Comparison
| Factor | Reverse Cycle Air Conditioning | Gas Heating |
|---|---|---|
| Upfront Cost | $1,500-$4,000 (split), $10,000-$20,000 (ducted) | $2,000-$5,000 (ducted), $500-$1,500 (standalone) |
| Running Cost | $0.15-$0.30/hour heating | $0.40-$0.80/hour heating |
| Cooling Power | COP 4-5 (produces 4-5kW heat per 1kW electricity) | 80-95% efficient (loses some heat up flue) |
| Best Climate | All climates (less effective below 0°C) | Cold climates (VIC, TAS, ACT, alpine) |
| DIY Install? | No | No |
Reverse Cycle Air Conditioning
Heat pump technology that provides both heating and cooling. Highly efficient.
Pros
- Cheaper to run than gas in most areas
- 300-500% efficient (COP 4-5)
- Also provides cooling in summer
- No gas connection required
- Lower carbon footprint (especially with solar)
Cons
- Less effective in very cold conditions (<5°C)
- Outdoor unit can be noisy
- Slower to heat large spaces than gas
- Higher upfront cost than gas heaters
- Requires electricity (vulnerable to blackouts)
Gas Heating
Burns natural gas to produce heat. Ducted or standalone heaters available.
Pros
- Heats large spaces quickly
- Works well in very cold conditions
- Feels like "natural" warmth
- Lower upfront cost for basic systems
- Works during electricity blackouts
Cons
- Higher running costs than reverse cycle
- Only heats - need separate cooling
- Requires gas connection (ongoing fees)
- Carbon emissions from burning gas
- Gas prices rising faster than electricity
Climate Zone Guide
Hot-Dry Climates (WA, SA, Inland)
Reverse cycle is clearly better - you need cooling most of the year anyway, and the mild winters are easily handled. No point paying for gas connection.
Hot-Humid Climates (QLD, NT)
Reverse cycle wins by default - heating is rarely needed, and you definitely need cooling. Gas heating makes no sense in tropical climates.
Temperate Climates (VIC, NSW, ACT)
This is where the decision matters most. Reverse cycle is now more economical for most Melbourne/Canberra homes. Gas may suit very cold areas or those who prefer radiant heat feel.
Cost Analysis
For equivalent heating output: Reverse cycle costs about $0.18-$0.25 per kWh of heat produced. Gas costs about $0.25-$0.40 per kWh of heat. Over winter (90 days, 4 hours/day), reverse cycle costs $250-$400; gas costs $350-$600. Plus reverse cycle provides summer cooling at no additional equipment cost.
Frequently Asked Questions
Is gas heating being phased out in Australia?
Yes, progressively. Victoria has banned gas connections in new homes from 2024. ACT is phasing out gas. Other states are following. While existing gas systems can continue, the long-term trend favours electrification with heat pumps.
What about gas ducted heating - should I replace it?
If your gas ducted system is working well, no urgent need to replace. When it reaches end of life (15-20 years), consider ducted reverse cycle or split systems. If you have solar panels, the economics strongly favour reverse cycle.
Does reverse cycle work in Canberra/Hobart winters?
Yes, modern reverse cycle systems work down to -15°C or lower. In Canberra/Hobart (rarely below -5°C), they work efficiently. Choose a model rated for cold climates (look for "Hyper Heating" or similar technology) for best performance.
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