Gas Heater vs Reverse Cycle Air Conditioner: Which Is Cheaper to Run in Sydney?
As Sydney winters approach, one of the most common questions we hear is: should I use a gas heater or a reverse cycle air conditioner for heating? The answer has shifted significantly in recent years as electricity prices and appliance technology have both evolved. Here's a detailed, up-to-date comparison for Sydney households.
How Each System Works
Gas Heater
A gas heater burns natural gas or LPG to produce heat. Flued gas heaters expel combustion gases outside; unflued heaters release gases (including water vapour) into the room. Gas heaters heat a room quickly and produce a dry, radiant warmth that many people prefer.
Reverse Cycle Air Conditioner
A reverse cycle air conditioner (also called a heat pump) doesn't generate heat by burning fuel — it moves heat from outside air into your home. This makes it extraordinarily efficient: for every 1 kWh of electricity consumed, a modern reverse cycle unit can deliver 3–5 kWh of heat. This ratio is called the Coefficient of Performance (COP).
Running Cost Comparison (Sydney, 2025)
Running costs depend on your gas tariff, electricity rate and the specific appliance's efficiency. Here are typical indicative costs:
| Heating Type | Typical Energy Cost | Notes |
|---|---|---|
| Natural gas heater (5-star) | ~$0.07–$0.12/kWh of heat | 5-star rated flued heater |
| LPG gas heater | ~$0.20–$0.35/kWh of heat | LPG is significantly more expensive per unit |
| Reverse cycle (COP 3.5) | ~$0.07–$0.11/kWh of heat | At 32c/kWh electricity, COP 3.5 |
| Reverse cycle (COP 4.5+) | ~$0.05–$0.08/kWh of heat | High-efficiency inverter units |
| Electric resistance heater | ~$0.28–$0.35/kWh of heat | COP 1.0 — least efficient |
Key Finding: Reverse Cycle Often Wins
Modern high-efficiency reverse cycle air conditioners with a COP of 4+ are now cheaper to run than natural gas heaters in Sydney in most scenarios. The gap is even larger if you're on LPG. With Sydney electricity rates around 28–35c/kWh and COP of 4, the effective cost per kWh of delivered heat is around 7–9c — comparable to or below natural gas.
Other Factors to Consider
Upfront Cost
A quality reverse cycle split system (2.5–3.5kW for a bedroom, 5–7kW for a living area) typically costs $800–2,500 for the unit plus $400–$800 installation. A gas heater is often cheaper to install if you have an existing gas outlet, costing $400–1,200 for the unit.
Versatility
Reverse cycle air conditioners provide both heating AND cooling. In Sydney's warm summers, this is a major advantage over gas heaters, which provide heating only. Buying one unit that does both jobs is often better value than buying a separate gas heater plus a cooling-only air conditioner.
Comfort
Some people prefer the radiant heat from gas heaters. Reverse cycle systems heat the air rather than radiate heat, which can feel different. Reverse cycle systems also dehumidify slightly during heating, which some find drier.
Environmental Impact
As Australia's electricity grid incorporates more renewable energy, reverse cycle systems are becoming progressively cleaner. Gas, while currently a lower-emission fuel than coal, produces CO2 and water vapour when burned. If you're on a GreenPower plan or have solar panels, reverse cycle heating produces minimal emissions.
Our Recommendation
For most Sydney households: a high-efficiency reverse cycle air conditioner is the better long-term choice. It heats and cools, often costs less to run than gas, and its environmental credentials will improve over time as the grid greens. If you already have gas and prefer radiant heat, a 5-star flued gas heater is a reasonable option.
Find the Right Heating at Oceania Appliances
Oceania Appliances stocks reverse cycle air conditioners from leading brands. Visit 2/14 Centre Place, Wetherill Park (open 7 days, 10am–8pm), call or WhatsApp 0422 489 492, or email support@oceaniaappliances.com.au.