For generations, natural gas has been an essential energy source for cooking, heating, electricity generation, and industrial use cases, and increasingly also transportation. It is a non-renewable energy source but is one of the cleanest fossil fuels that causes less harm to the environment. Fortunately, the use of renewable energy sources such as solar energy, wind energy, and biomass is expanding each year. As infrastructure for these energy sources improves, dependence on finite fossil fuel resources like natural gas will continue to decline.
This blog examines the shift from the use of gas to electricity, highlighting how governments, regulators, and local utilities are encouraging households to adopt electric appliances through targeted programs and incentives. It also outlines the critical role of disruptive digital technologies such as the Internet of Things (IoT) and Artificial Intelligence (AI) in enabling this transition. If you want to read about gas smart meters and electricity smart meter solutions in detail, there are detailed reports here: Gas Smart Meters: Urbanisation, energy security, connectivity, and mandates to drive adoption of over 587 million gas connections by 2035 and Electricity Smart Meters: Government policies and sustainability initiatives will drive 2.3 billion connections in 2034.
As per the International Energy Agency (IEA), global natural gas demand is projected to have increased by an estimated 2.5% in 2024. A major source of that demand comes from heating in buildings. In order to curb this demand, various states around the world are exploring policies to transition from natural gas to renewable energy in buildings. Direct and indirect regulatory tools can both help to reduce the amount of natural gas used in buildings contexts.
Here, we have listed some of the regulations that play a pivotal role in this effort, focusing on examples from just Australia and California in the United States:
Technology plays a key role in tracking and managing the gas appliances replaced with electricity-powered alternatives. For instance, a lot of all-electric residences, defined as those homes whose energy needs, such as heating, hot water, and cooking are all powered by electricity, would require the integration of solar panels (photovoltaics, or PVs) and battery storage systems to store the energy generated from these PVs. This energy can be used for electric vehicle (EV) charging and operating electric appliances inside houses, thereby reducing the burden placed on the electricity grid and reducing electricity bills. Heat pumps using renewable energy sources such as wind and solar electricity can be used to heat homes and workplaces, instead of using natural gas. Technology also plays a key role in managing the demand of multiple appliances at the same time. The use of network connectivity is also important for the real time monitoring of equipment and predictive maintenance.
IoT plays a crucial role to support the monitoring of appliances, as well as in battery storage systems, and it is also important to monitor smart electricity meters in which case it is often deployed to support remote meter reading, real-time data monitoring, and more efficient billing operations. Technology is useful in managing and accommodating the fluctuating output from renewable sources such as solar and wind to ensure a balanced and dependable power supply. In addition to IoT, AI can act as a central intelligence for a home energy management system. For instance, AI can be used to automatically schedule energy intensive tasks such as EV charging and running a washing machine during off-peak hours or when ample renewable energy is available.
In this section of the blog, we explore some of the benefits of this transition, including reduced energy bills, enhanced sustainability, and reduced GHG emissions.
By switching to electric appliances and integrating PV generation, households can reduce their use of expensive grid-sourced electricity. Case in point, residents in Victoria (Australia) who have electric homes that do not use natural gas and use solar PV systems instead, save up to AUD1,920 per year (USD1,282.5 per year) on electricity bills, and those without solar save up to AUD990 per year (USD661.3 per year). Additionally, consumers can avail of benefits such as rebates and subsidies for solar panel installations, support for battery storage systems and even subsidies for electrically powered appliances. For example, the government of Victoria offers a discount of AUD140 (USD93.5) on induction cooktops as part of the Victorian Energy Upgrades (VEU) program.
Curbing the use of natural gas and increasing reliance on renewable energy sources for electricity generation helps to reduce dependence on non-renewable fossil fuels, contributing towards a more sustainable energy system.
Electricity from renewable sources has a significantly lower carbon footprint than non-renewable fossil fuels. It helps decrease greenhouse gas emissions, contributing to a cleaner environment. This will help governments around the world to achieve zero-emission targets for new buildings in the near future. For example, approximately one-third of households in Canberra have phased out gas since the announcement of an integrated energy policy in 2022-2023 and are now all-electric homes. The development is a key step to phase out natural gas in the capital by 2045.
The transition from gas to electricity is not a rapid process and it requires consumer demand, partnership between city networks and local utilities, influence from state governments, financial incentives and local campaigns. Regulatory tools such as subsidies, rebates on solar panels, the introduction of building performance standards and emission performance standards, and land-use regulations are likely to help cities in slowly phasing out gas networks. The transition is already underway; however, achieving significant emissions reductions and the widespread adoption of fully electric homes is expected to take some time.
