How winter heating costs stack up across Australia’s LGAs

Australia is best known for its scorching summers, but winter brings a different kind of pressure, particularly when it comes to the cost of living. As households turn up the heating, the potential cost of staying warm through winter and what share of household income that represents becomes harder to ignore.

With this in mind, we set out to identify the Local Government Areas (LGAs) where it costs the most to heat your home in the cooler months (May to September), and how much of your household income this uses.

To do this, we estimated heating energy needs in each LGA using NatHERS heating load data for residential housing stock. We then converted this into electricity or gas use based on typical efficiency. Next, we applied local energy prices to calculate the cost. Finally, we calculated what share of median household income this represents to measure affordability.

National Household Heating Costs

During the Australian winter, maintaining a comfortable indoor temperature using a reverse-cycle air conditioner is estimated to cost around $240 over the winter period, making it one of the most economical options due to its high efficiency. If households switch to a portable or panel heater, bills can rise to $895, as they are far less efficient for heating and consume more power to achieve the same level of warmth.

Gas ducted systems cost about $724 on average across the LGAs where gas is available, reflecting the higher unit cost of gas as a fuel and the heating efficiency of these systems.

The Most Expensive LGAs for Reverse-Cycle Heating

But which LGAs are seeing the highest heating costs? Eight of the ten most expensive LGAs to heat with a reverse-cycle air conditioner are in New South Wales, driven by colder inland climates, older housing stock, and higher electricity prices.

Muswellbrook ranks highest in New South Wales, as keeping a home warm over winter is estimated to cost close to $744, or $4.86 a day. Upper Lachlan, in fourth place, and Cabonne, in fifth, follow closely, with both estimated at around $4.43 a day or more than $670 to heat a home over winter.

Mount Barker in South Australia takes the top spot overall, as heating a home is estimated to cost more than $5 a day or an astounding $771 over the winter season. The only other area in South Australia to appear in the top 10 was Murray Bridge, where the estimated cost of staying warm from May through to September is around $718.

Compared to the national average, in the most expensive LGA, the estimated cost of heating a home over winter is more than $530 above the national average.

The Least Affordable LGAs for Winter Heating

The least affordable LGAs for heating are not always the coldest or most expensive, but rather, those where heating consumes the largest share of annual household income.

Murray Bridge in South Australia takes the top spot as the least affordable. With low household incomes ($46,384), the estimated cost of heating a home represents 1.55% of annual household income. This is followed closely by Peterborough, also in South Australia. Although reverse-cycle heating costs are lower, smaller household incomes ($31,720) mean that heating a home is estimated to account for 1.37% of annual income. Clearly, colder winters and lower regional incomes are driving affordability pressures across the state.

New South Wales also features heavily on the list, accounting for six of the least affordable LGAs. Glen Innes Severn, Berrigan and Hilltops stand out the most. With average household incomes ranging from $40,000 to $50,000, the estimated heating cost represents around 1.2% of annual income. Interestingly, Glen Innes Severn has the second-lowest heating cost in the top 10 ($492.96), highlighting how strongly household income levels influence affordability.

Central Goldfield was the only LGA in Victoria to make the top 10. While its reverse-cycle heating cost ($501.03) is not the highest overall, that estimated cost falls on households with very low incomes, resulting in heating accounting for 1.27% of annual income.

The Cost of Choosing the Wrong Heating System

Choosing the right heating system is essential not only to ensure comfort but also to see long-term savings.

Across LGAs, keeping a home warm with a reverse-cycle air conditioner is estimated to cost around $240 over winter compared to almost $900 for a portable heater.

Though Victorian households spend over $100 more than the national average to heat their homes using a reverse-cycle air conditioner, switching from a portable or panel heater to reverse-cycle is estimated to save up to $912 per winter. Similarly, South Australia records the second-highest savings ($863), making the choice of heating system especially significant for households already under financial pressure.

The Northern Territory ($212.99) and Queensland ($175.71) recorded the lowest savings differences, sitting more than $200 below sixth-placed Western Australia. However, this reflects their warmer climates and lower reliance on heating, rather than any significant difference in system efficiency or usage costs.

Goran Surbevski – Project Manager at Alliance Climate Control, comments:

“Our study shows how the type of heating system used is often an overlooked driver of household financial pressure. Reverse-cycle air conditioning remains the most efficient option, and inefficient alternatives can increase estimated heating costs to almost four times that amount, a difference that represents significant potential financial pressure for households.”

“At the same time, our study also reveals a consistent pattern across Australia; inland regional communities with modest incomes are bearing the greatest heating burden. The results show that colder inland areas, particularly in New South Wales and South Australia, consistently face the highest heating costs and the greatest affordability pressure. Regardless of where you live, the findings suggest that switching heating systems is one of the most effective ways households can reduce essential cost-of-living pressures this winter.”

About the data

Overview

The Cost of Comfort Index estimates what Australian households in each local government area spend on home heating across the extended winter period (May to September), and what that represents as a share of local household income. The methodology works in four steps: estimating how much energy each LGA’s housing stock needs to stay warm; converting that to electricity or gas consumption based on the efficiency of each heating system type; applying local energy tariffs to calculate a dollar cost; and expressing that cost as a percentage of median household income to produce an affordability measure. All inputs are drawn from publicly available government data sources.

Step 1 — Heating energy demand

How much energy does it take to keep a home warm in winter? The answer varies significantly by location, climate, and the quality of the housing stock.

For LGAs with sufficient data (30 or more NatHERS-rated dwellings), heating load figures were drawn directly from the Nationwide House Energy Rating Scheme (NatHERS). NatHERS models the energy required to maintain a comfortable indoor temperature of 20°C throughout the heating season, expressed in megajoules per square metre of conditioned floor area. This was multiplied by the average conditioned floor area of dwellings in each LGA to produce a total heating energy requirement. That figure was then scaled to the May–September window using each LGA’s share of annual heating degree days falling in that period.

For LGAs without sufficient NatHERS data, heating demand was estimated using Bureau of Meteorology heating degree day (HDD) data – a standard measure of how much heating a location requires based on how far outdoor temperatures fall below 18°C. HDD-derived estimates were calibrated against NatHERS figures for comparable LGAs to ensure consistency.

LGAs where May–September HDD totals fell below 20,  indicating negligible heating demand, were assigned zero heating cost and excluded from all rankings and averages.

Step 2 — Heating system efficiency

Three heating systems are modelled, reflecting the most common options available to Australian households.

• Reverse-cycle air conditioning is modelled using a Coefficient of Performance (COP): the ratio of heat output to electricity input, derived from the Australian Government Energy Rating Registration Database (May 2026), capacity-weighted across all registered non-ducted split systems. A COP of 3.85 applies to temperate climate zones and 3.48 to cold-climate zones (annual HDD ≥ 1,400), reflecting reduced efficiency in colder conditions. A COP of 3.85 means that for every unit of electricity consumed, 3.85 units of heat are delivered.
• Portable and panel heaters (electric resistance) operate at a COP of 1.0 by definition, every unit of electricity produces exactly one unit of heat, with no efficiency multiplier.
• Gas ducted heating is modelled at 80% thermal efficiency, derived from the December 2025 AGA Directory of Certified Products and adjusted downward from the certified mean of 83% to reflect the age of installed stock in Victoria and South Australia.

Step 3 — Energy rates and LGA assignment

Electricity usage rates are sourced from Energy Made Easy, WATTever, and retailer websites (accessed May 2026), effective 1 July 2025. Rates are averaged across Standing Offer and Basic Plan products from the three largest retailers per distribution zone, plus the cheapest available retailer. Distributor zones are assigned to LGAs by spatial intersection of ABS Postal Area and LGA boundaries, with the dominant distributor by land area applied where an LGA spans multiple zones. Supply charges are excluded from all cost figures

Gas usage rates are sourced from WATTever (May 2026) using Standing Offer and Basic Plan products only. Gas networks are assigned to LGAs using the same spatial approach for networks listed in the Australian Government’s Consumer Data Right Energy API; networks not covered by the CDR are assigned via representative postcode. For networks with a two-block daily consumption structure, a higher rate up to a daily threshold, and a lower rate above it, a blended effective rate is calculated per LGA using that LGA’s implied daily gas consumption derived from its heating load. This ensures high-demand LGAs, which draw more of their consumption from the cheaper upper-block tier, are accurately costed rather than assessed against a fixed consumption assumption. Tasmania’s Tas Gas Networks applies a single regulated flat rate across the 10 LGAs where Tas Gas Networks urban distribution infrastructure is understood to be present, primarily covering the major centres of Hobart, Launceston, Devonport, Burnie, Wynyard and Ulverstone

A note on Victorian gas: the CDR returns Victorian gas network data at the parent-company level (Australian Gas Networks, AusNet Services, Multinet) without differentiating between sub-networks. Victorian gas rates are therefore averaged across sub-networks within each parent company. Rate variation within each parent is approximately 10–15% and does not affect the direction of any finding.

All rates are GST-inclusive. Supply charges are excluded throughout. Electricity and gas tariffs reflect rates effective 1 July 2025 and are subject to change

Step 4 — Affordability index

Each LGA’s estimated heating cost is expressed as a percentage of median annual household income, drawing on the 2021 ABS Census (ABS Data by Region, released November 2025), specifically median equivalised total household income, which adjusts for household size and composition.

Census income figures are adjusted to March 2026 price levels using the ABS Consumer Price Index All Groups Australia (series A2325846C). The index rose from 82.47 in June 2021 to 101.70 in March 2026, an adjustment factor of 1.233 representing 23.3% cumulative inflation over that period.

Limitations

Income data recency: The 2021 Census is the most recent source of LGA-level household income in Australia. CPI adjustment accounts for general price growth but does not capture structural shifts in incomes — including above-inflation wage growth in some sectors between 2022 and 2024. The 2021 Census remains the standard reference for subnational income analysis; no annual LGA-level income series is published by the ABS.

Distributor zone assignment: Electricity distributor zones and gas network boundaries do not always align precisely with LGA boundaries. Where an LGA spans multiple distributor zones or gas networks, the dominant zone by land area was assigned to the entire LGA. This approach may not reflect the distribution of population within the LGA — in some cases, the majority of residents may be in a different zone to the one assigned. For LGAs with significant internal variation in energy network coverage, individual household costs may differ from the LGA-level estimate presented here. Gas networks not available via the Consumer Data Right Energy API were assigned using a representative postcode centroid approach, which is an approximation of the network’s service area rather than a precise spatial boundary.

Gas coverage: Gas heating is only priced for the approximately 184 LGAs served by a reticulated gas network. Gas is unavailable in the Northern Territory and has limited reach across rural WA, QLD, and parts of SA and NSW. Gas figures should not be read as a national ranking — they reflect only areas where gas is a realistic option. For one LGA (Mount Gambier, SA), the AGN South Australia metropolitan rate was applied as a representative approximation for the AGN-owned South East SA sub-network (operated by APA Group), as specific tariff data for that sub-network was not available via the Consumer Data Right API. The presence of a gas network within an LGA does not mean all dwellings can connect — availability varies by suburb, street, and estate. Households should verify gas availability at their specific address with their local distributor.

Housing stock: NatHERS certificates cover dwellings built or significantly renovated since 2016 and may not fully represent older housing stock, which is typically less efficient. Heating costs in LGAs with predominantly older dwellings may be modestly understated.

LGA name changes: A small number of LGAs were renamed between the 2021 Census and the 2025 ABS boundary definition used in this analysis. Manual corrections were applied where necessary. The most significant case is Moreland (2021 Census name) which was renamed Merri-bek in 2022 and required explicit correction in the income matching step.

Disclaimer

This analysis is intended for general informational purposes. Individual household heating costs will vary based on home size, insulation quality, thermostat settings, occupancy patterns, and the specific energy plan held. The Cost of Comfort Index represents modelled estimates based on LGA-level averages, not individual household assessments.