Victoria's e-cigarette market could be worth up to $500 million and almost half a million people vape.
That's according to analysis by the state's parliamentary budget office, released amid an ongoing violent conflict between organised crime groups over illegal cigarettes in Victoria.
The dispute has been linked to more than 30 arson attacks in the past year, with syndicates accused of demanding regular payment from shop owners and ordering lower-level criminals to carry out firebombings.
The analysis estimates 461,000 Victorians are vape users and value of the state's market is between $306 million to $503 million.
It does note "significant uncertainty" around the figure due to limited research and a reliance on self-reported data.
It's illegal to smoke or possess vapes with nicotine unless prescribed by a doctor but Cancer Council Victoria figures show just 8.6 per cent of users have a prescription.
Teens aged between 14-17 are estimated to represent eight per cent of the market, which the report said indicates illegal selling to minors.
It attributes the uptick in vaping to a mix of first-time users taking up the habit and former tobacco smokers making the switch.
Illegal vapes are often advertised at tobacco shops and Victoria is currently the only Australian state without a e-cigarette licensing scheme or formal plans to introduce one.
Libertarian MP David Limbrick requested the analysis in June 2023 in a bid to understand the size of the vape market.
"We're interested in some of the root causes of organised crime," he told reporters on Wednesday.
Police Minister Anthony Carbines says the government has made it clear the sale of single-use vapes is illegal.
"What we're finding is organised crime can see that there's value in selling illegal vapes, illegal tobacco," he said.
"There's a lot of work that needs to be done and is being done between the Australian Border Force and Victoria Police to crack down on the sale and importation of single-use vapes."
In November, Health Department Secretary Euan Wallace said Victoria was unable to keep track of how many retailers sold e-cigarettes but discussions were under way into how licensing could work.
E-cigarettes were introduced as a potential therapy to help smokers give up cigarettes but there was "flimsy evidence" they were effective at doing so, he said.
"Big tobacco knew exactly what it was doing when it introduced e-cigarettes," he told the state's Public Accounts and Estimates Committee.
"They are vendors of death."
