How a heat pump heats water
Picture a fridge working backwards. A fan pulls outdoor air across a coil, a refrigerant soaks up warmth from that air, a compressor concentrates it, and the heat passes into the water in the tank.
Some models sit the heat pump on top of the tank as one unit. Others split it in two, with the heat pump outside and the tank close by. Either way the water is stored, so the storage temperature rules still apply.
When people look at a heat pump
- A Victorian gas system is getting near the end of its life.
- An electric storage tank needs replacing and you want an efficient electric option.
- You're building, and the home will be all electric.
- A Victorian rental's hot water has failed for good.
- You'd like a discount that applies to eligible heat pumps where you live.
Where it should sit
- Outside, or in a space with plenty of fresh air.
- On a firm, level base, with room around it for air to move.
- Away from bedroom windows and the neighbour's fence, because the fan and compressor make some noise. See heat pump noise.
- Near a drain for the condensate and the relief valve.
- With room for a plumber to reach the valves later.
STCs and the 425 L limit
Air source heat pumps can earn small-scale technology certificates (STCs) under a federal scheme, but only if the tank is under 425 L and the model is on the Clean Energy Regulator's register.
The installation also has to meet your state's licensing requirements. Owners often hand the right to create the certificates to an agent in exchange for a discount or a delayed cash payment. Certificates are issued until the scheme ends in 2030. More on STCs.
Rebates and discounts by state
Victoria. Eligible owner-occupiers may get a Solar Homes rebate, and VEU discounts come through accredited businesses. See Victoria.
NSW. The Energy Savings Scheme offers a discount, with amounts the Government calls indicative only. See NSW.
ACT. The Sustainable Household Scheme lists hot water heat pumps among the products its loans cover. See ACT.
Each program expects you to pay part of the cost. If anyone tells you a heat pump won't cost you a thing, walk away.
Who installs it, and the rules
A plumber will site the unit, connect the cold supply and hot outlet, run the relief valve and condensate drains, and fit temperature control where your state requires it. The power supply may need an electrician.
In Queensland, heat pump systems must be installed by a hot water installer with a QBCC solar and heat pump endorsement.
In a Victorian rental, from 1 March 2027, a system that permanently fails and can't be repaired must be replaced with an efficient heat pump or an electric-boosted solar water heater.
Victorian plumbers are registered or licensed by class of work, and the compliance certificate has to come from a licensed one.
Getting ready
You can
- Shortlist two or three outdoor spots and measure them.
- Stand at each one and think about who sleeps nearby.
- Take a photo of your switchboard for the plumber and electrician.
- Find the old system's install date: some rebates depend on its age.
Leave to a licensed plumber
- Siting, pipework and drains.
- Removing the old unit, and capping the gas if you're switching.
- Temperature control devices where they're required.
- STC and rebate paperwork, with the retailer.
Questions to ask about a heat pump
- Is this model on the register, with a tank under 425 L?
- Who creates the STCs, and where does the discount show on the quote?
- How far will it be from the bedrooms, and how loud is it?
- Will you need an electrician for the power supply?
- What does the warranty cover for the heat pump and for the tank?
What we would do
Choose the spot before you choose the model. The quietest, airiest place that's still close to the bathrooms decides which units fit. Then check the discounts for your state, and ask a plumber who specialises in heat pumps to put the STC and rebate details in writing on the quote.