Victoria is already deep into its electrification push, with policy settings that discourage new gas connections in homes and businesses while encouraging electric appliances, heating and vehicles. At the same time the state is working to phase out coal-fired generation and rely more heavily on renewable energy, which changes when and how electricity flows through the grid. Network operators now sit in the middle of these overlapping pressures, trying to keep power reliable and affordable while usage patterns shift faster than the traditional regulatory cycle.
New analysis from major Victorian distribution networks shows how stark that shift is becoming at the household level. One inner-city network with more than 300,000 customers found that homes that disconnected from gas and went all-electric lifted their electricity use by more than 250% during winter peak periods, and on the coldest mornings and evenings their power draw rose to more than four times previous levels. A separate review of more than 1,200 customers on a larger regional network pointed to the same pattern and suggested this is a systemic trend rather than an outlier. Network businesses argue that under current revenue allowances they cannot invest fast enough in local transformers, lines and substations to keep up with these new loads.
The concern is less about statewide blackouts and more about local power quality problems that creep into everyday life. Without extra spending on low-voltage infrastructure, the forecast surge in electrified heating, hot water systems and electric vehicle chargers looks likely to drive undervoltage issues in many suburbs where sudden swings in demand cause flickering lights, dimming or appliances and chargers that fail to work properly. Customer surveys by one major network show more than 70% of respondents see undervoltage as a significant risk and those constraints could also undermine federal plans to encourage households to use more power in the middle of the day when rooftop solar output is high and wholesale prices are low. Regulators, however, have previously pushed back on additional spending requests and argued the current network is still able to meet minimum reliability standards through to the next review period in 2031.
All of this feeds into a broader tension between affordability, climate targets and the practical limits of grid infrastructure. Network charges already make up roughly 40% of a typical electricity bill and are tightly controlled by the national regulator, which wants to avoid unnecessary cost increases for consumers, particularly as large new connections such as data centres line up. The regulatory process works on five-year cycles but household technology and usage patterns are changing far more quickly, leaving both regulators and networks trying to anticipate what demand will look like near the end of the decade. Network businesses argue that smarter, earlier investment in the poles and wires that serve streets and suburbs can support electrification without lifting bills and they point to modelling that suggests higher overall energy use could even slightly reduce average distribution costs for some customers. For now the path to an all-electric, low-emissions Victoria seems to depend on whether regulatory settings can keep pace with the real-world changes already underway in neighbourhoods across the state.
