Victorian Government celebrates over 16,600 Heat Pump Water System Upgrades amid gas phase-out

    In a significant step towards achieving a more sustainable and environmentally-friendly state, Victorian Minister for Energy & Resources, Climate Action, and the State Electricity Commission, Lily D’Ambrosio, has proudly announced that more than 16,600 homes across Victoria have upgraded their hot water systems to advanced heat pumps.

    This milestone underscores the state’s commitment to reducing carbon emissions and transitioning to greener energy solutions.

    Understanding Heat Pump Water Systems

    Heat pump water systems represent a cutting-edge technology in home water heating. Unlike traditional gas or electric water heaters, heat pumps utilize the ambient air temperature to heat water. Essentially, they work similarly to a refrigerator but in reverse—extracting heat from the air and transferring it to the water.

    How It Works

    1. Air Intake: The system draws in outside air.
    2. Heat Transfer: The air passes over refrigerant coils, transferring heat to the refrigerant.
    3. Compression: The refrigerant is compressed, raising its temperature.
    4. Heat Exchange: The hot refrigerant transfers its heat to the water stored in a tank.
    5. Cycle Repeat: The refrigerant cools down and returns to the coils to start the process again.

    Benefits of Heat Pump Water Systems

    1. Energy Efficiency:

    Heat pump water heaters are significantly more energy-efficient compared to conventional gas water heaters. They use electricity to move heat rather than generate it, consuming up to 60% less energy.

    2. Environmental Impact:

    By reducing reliance on gas, these systems decrease greenhouse gas emissions. This is pivotal for Victoria’s broader climate action goals.

    3. Cost Savings:

    Despite a higher upfront cost, the energy savings over time can lead to lower utility bills, making heat pump systems economically advantageous in the long run.

    4. Renewable Integration:

    Heat pumps can be seamlessly integrated with solar power systems, further enhancing their green credentials and reducing household carbon footprints.

    Victoria’s Bold Move to End Gas Supply to New Homes

    Victoria has taken a progressive stance by deciding to phase out gas supply to new homes starting 2023. This move is part of the state’s broader strategy to cut carbon emissions and promote renewable energy usage. The decision aligns with global trends where governments encourage shifts away from fossil fuels to combat climate change.

    The Solar Homes Program

    The Victorian Government’s Solar Homes Program has been instrumental in facilitating the transition to sustainable energy solutions. This program offers grants to homeowners, making it more affordable to upgrade to energy-efficient technologies like heat pump water systems. Under the program, eligible homeowners can receive substantial rebates, which cover a significant portion of the installation costs.

    Key Features of the Solar Homes Program:

    The Solar Homes Program in Victoria is a government initiative aimed at increasing the adoption of renewable energy sources and improving energy efficiency in households. Here are the key features of the program:

    1. Rebates for Solar Panels

    • Eligibility: Victorian homeowners with a combined household taxable income of less than $180,000 per year and a home valued at under $3 million are eligible.
    • Rebate Amount: Eligible households can receive a rebate of up to $1,400 for the installation of solar panel (PV) systems. Additionally, there’s an option for an interest-free loan to match the rebate amount.

    2. Rebates for Solar Hot Water Systems

    • Eligibility: Similar to the solar panel rebate, homeowners must meet the income and home value criteria.
    • Rebate Amount: The program offers rebates of up to $1,000 for replacing an existing hot water system with a solar hot water system.

    3. Rebates for Heat Pump Hot Water Systems

    • Eligibility: The same eligibility criteria apply as for other rebates.
    • Rebate Amount: Households can receive up to $1,000 to upgrade their existing hot water system to an energy-efficient heat pump hot water system.

    4. Solar Battery Rebates

    • Eligibility: Homeowners with existing solar PV systems and who meet the income and home value criteria can apply.
    • Rebate Amount: The program provides rebates of up to $4,174 for the installation of a solar battery storage system, making energy storage more accessible and affordable.

    5. Interest-Free Loans

    • Availability: For solar panel installations, the program offers interest-free loans up to the amount of the rebate (up to $1,400), which can be paid back over four years.
    • Purpose: This feature is designed to lower the upfront costs and make the transition to solar power more financially feasible for households.

    6. Solar for Rentals Program

    • Eligibility: Landlords can apply for rebates to install solar PV systems on rental properties, provided they meet the income and property value criteria.
    • Rebate Amount: The rebate is similar to that for owner-occupied homes, up to $1,400, with an option for an interest-free loan.

    7. Community Housing

    • Support: The program extends to community housing providers, allowing them to access rebates and loans to install solar energy systems for the benefit of their tenants.

    8. Training and Job Creation

    • Investment in Workforce: The program includes funding for training and accreditation of installers, ensuring that the solar industry in Victoria grows sustainably and with a skilled workforce.
    • Job Opportunities: By boosting the demand for solar installations, the program is expected to create jobs and support local businesses in the renewable energy sector.

    9. Energy Savings and Environmental Impact

    • Cost Reduction: By reducing energy bills through solar and energy-efficient systems, households can save significantly on their electricity costs.
    • Carbon Footprint: The widespread adoption of solar and efficient energy systems contributes to reducing the state’s carbon emissions, aligning with Victoria’s climate action goals.

    10. Application Process

    • Easy Access: The application process for rebates is designed to be straightforward. Homeowners can apply online, and the program provides resources and guidance to assist with the application.


    The upgrade of over 16,600 homes to heat pump water systems marks a crucial step in Victoria’s journey towards a greener future.

    Minister Lily D’Ambrosio’s announcement highlights the state’s dedication to reducing its carbon footprint and enhancing energy efficiency.

    With supportive programs like the Solar Homes Program and the decisive phase-out of gas in new homes, Victoria is setting a strong example for sustainable living and climate action.

    This initiative not only benefits the environment but also offers long-term economic advantages for Victorian households, making it a win-win for all.

    Jason Cartwright
    Jason Cartwright
    Creator of techAU, Jason has spent the dozen+ years covering technology in Australia and around the world. Bringing a background in multimedia and passion for technology to the job, Cartwright delivers detailed product reviews, event coverage and industry news on a daily basis. Disclaimer: Tesla Shareholder from 20/01/2021

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