Orbost and Lakes Entrance residents are among 1100 regional Victorians who will be forced to find a new energy source after operator Solstice Energy announced it is shutting down its local gas pipeline networks by the end of 2026.
The company, which recently took over operations from Tas Gas, informed customers this week that running the compressed natural gas (CNG) networks in 10 regional towns, including Orbost, had become too expensive.
Affected customers will be offered compensation and support to transition to either bottled liquified petroleum gas (LPG) or full electrification.
Gippsland East MP, Tim Bull, said he had received a preliminary briefing and there were 22 customers in Orbost affected and 122 in Lakes Entrance, including three businesses in each town.
“What I have asked for is some case studies on how this will impact both households and businesses financially and await that information,” he said.
“Solstice has said in a statement it has been absorbing substantial increases in costs over the past two years and had not been passing these costs on to customers, but with rising costs says it is now in a position where it has to pass the increases on.
“It has advised it will offer customers two options, one of those being a cash payment, or it will cover the costs of transitioning the customer to either electricity or LPG and will be in touch with them shortly to discuss these options. I also await further detail on this.”
The current system involves trucking CNG to a central station in each town before distributing it through a local pipeline network. A Solstice Energy spokesperson said constant cost increases over the past few years had made this model unsustainable.
The announcement comes after years of price pressure on the network. In 2023, some customers in other affected towns reported facing monthly bills of over $1000 after significant price hikes, while one resident reported receiving a quote of $30,000 to fully electrify their home.
Solstice said it would help fund and coordinate the switch for customers who want to keep using their existing gas heaters and cooktops with bottled LPG, and will also assist with some costs for those choosing to electrify.
“We understand the immediate price increases may be difficult to absorb for some customers prior to the change, and we will work closely with any customers experiencing financial difficulties,” the spokesperson added.
