On this page:
For households, hot water can make up as much as 18% of their energy bill.
In commercial buildings, this can be as high as 36%, and even higher for industrial facilities.
By installing an energy-efficient hot water system you can lower your power bills, reduce carbon emissions and save energy.
Eligibility
All Victorian households and businesses* can receive discounts when upgrading a gas or electric hot water system.
Please note, old gas-boosted or electric-boosted solar hot water systems are not eligible for discounts under the Victorian Energy Upgrades (VEU) program.
*Victoria’s largest energy users are exempt from the program.
Living in a rental property?
If you’re living in a private rental property, you are eligible to receive a discount on a hot water system.
We recommend that landlords and tenants work together when doing any upgrades to a rental property.
How much discount to expect
Discounts for hot water upgrades for households and businesses.
Remove this system | Replace with this upgrade | Indicative discount* |
|---|---|---|
Inefficient electric hot water system | Replace with this upgrade | $1,190 |
Inefficient electric hot water system | Solar-boosted hot water system | $840 |
Inefficient gas hot water heater | Heat pump hot water heater | $490 |
Inefficient gas hot water heater | Solar-boosted hot water system | $700 |
Your final installation cost, including your discount, is determined by your accredited provider. This cost depends on your:
- certificate price (which fluctuates)
- accredited provider’s administrative costs
- choice of product and/ or upgrade
- location
- installation costs.
For more information on certificate prices under the VEU program, please visit Victorian Energy Efficiency Certificates (VEECs).
Hot water system upgrades available
View our list of hot water upgrades below.
To replace | Why replace it? |
|---|---|
Use your electricity supply to heat water in an insulated storage tank. | Electric hot water systems have the cheapest up-front costs, but are the most expensive to run. Opt for a heat pump hot water heater instead. |
Inefficient gas hot water heaters use liquefied petroleum gas, natural gas or simulated natural gas to store hot water in a tank or heat water on demand. | Gas storage systems are inefficient, particularly in colder climates. They have very high heat loss because they can’t insulate where the gas flame is heating the tank. |
Energy-efficient upgrade | Why choose it? |
|---|---|
Heat pump hot water systems extract heat from the surrounding air to heat water in an insulated storage tank. Heat pump units can be integrated on top of their tanks or used as a separate (split system). | They are the most efficient hot water system in the market. These use up to 75% less electricity than a conventional electric hot water system. |
Solar-boosted hot water systems generate heat directly from the sun. Hot water is stored in a hot water tank that is connected to solar collector panels. | Solar-boosted hot water systems are the most energy-efficient and the cheapest hot water systems to run |
Installing the right heat pump water heater
To minimise costs when installing hot water heat pumps, it is important to size them to meet your business needs.
DEECA has engaged the Australian Alliance for Energy Productivity (A2EP) to develop a range of guidance materials to support:
- best practice design
- optimisation and installation of commercial and industrial heat pump water heaters.
These guideline resources support the design and installation of heat pumps water heaters in commercial and industrial applications account. They include technical design considerations and case studies to highlight applications of these principles.
Design considerations and guidelines
Accredited providers often work with installers who are not listed on the registry.
Please note that as VEU is a market-based program:
- not all accredited providers listed above may currently offer pool pumps
- accredited providers can choose when and where they undertake upgrades.
Find an accredited provider in your area
Case studies
Factsheets
Download our factsheets for more information on upgrading your home or business.
Page last updated: 23/07/24