Cut your hot water energy use by up to 75%. A heat pump water heater is one of the most efficient ways to heat water for your home, saving you hundreds of dollars on your energy bills every year.
How it works
A heat pump water heater (also known as an air source heat pump) works like an air conditioner in reverse. Instead of pumping heat out, it pulls warmth from the surrounding air and uses it to heat the water stored in the tank. Because it doesn't create heat from scratch, it’s far more efficient than a traditional electric storage hot water system.
Who it’s best for
A heat pump water heater is a good option for any homeowner or small business owner wanting to cut energy bills and reduce emissions.
Consider an upgrade if you:
- are replacing an old, broken or inefficient hot water system
- have solar panels and want to use this energy to heat your water during the day
- have a home or business that uses a lot of hot water.
How much you can save
How much it will cost
Case study
"We replaced our gas hot water system with a heat pump. It immediately reduced our gas bill or our hot water bill from about $600 a year down to about $75 a year. Now that we're running it all off solar, the bill is zero. So, we get our hot water completely free."
– Ken and Corinne, NSW homeowners who saved on energy by upgrading to a heat pump hot water system.
Get started
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Choose your heat pump water heater
- Get multiple quotes from licensed installers who specialise in heat pump water heater installations. Different installers offer different models and different prices.
- It’s important to compare options so you get the best deal for you and your home.
- You can use third-party comparison websites to help find local installers, get quotes and compare products at Solar Quotes, Solar Choice or Energy Matters.
- Check that your installer has a current license on the Service NSW website. The installation must be done by a licensed plumber and/or electrician for a safe and compliant installation, and to be eligible for incentives.
- Look for a built-in timer so you can choose to heat your water with solar energy or with off-peak electricity prices.
- You also will need to hire a qualified gas technician if you replace an existing gas hot water system.
- Get multiple quotes from licensed installers who specialise in heat pump water heater installations. Different installers offer different models and different prices.
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Install your heat pump
- Once you have chosen your installer and the heat pump water heater model, set a date for your installation.
- Ask installers:
- which brands and models are they have that are on the Clean Energy Regulator’s register. Only these heat pump water heaters (also known as air source heat pumps) are eligible for incentives from the Australian and NSW Governments
- to help choose the right tank size for your household’s needs to ensure you don’t run out of hot water
- about the system’s installation location so that it’s safe and has adequate air flow
- about the system’s warranty period, which should be for a minimum of 5 years
- if they can provide upfront NSW Government and/or Australian Government incentives.
- Your installer should then:
- install your new system
- show you how to use and maintain the new system
- safely dispose of or recycle your old hot water system if you were replacing it
- assist with any issues for the duration of the product’s warranty. In some cases, the warranty on parts may be provided by the equipment manufacturer and not the installer.
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Get the most out of your new heat pump water heater
- Set the thermostat to 60°C for safe and efficient heating.
- If you have solar, use the timer to heat water during the sunniest part of the day to take advantage of free solar power.
- Clear the area around the outdoor unit of debris and vegetation to maintain airflow.
How to get financial help
NSW Government's hot water upgrade incentive
- Who it's for: NSW homeowners replacing an older water heater with an eligible heat pump water heater.
- How it works: Get an upfront discount on the quote for the installation. This could be:
- up to $640 for replacing an old electric water heater with an air source heat pump water heater
- up to $330 for replacing a gas water heater with an air source heat pump water heater.
- How to access it: Get multiple quotes to find the best water heater and price for you and complete the required paperwork from your installer.
Australian Government’s Small-scale Renewable Energy Scheme (SRES)
- Who it's for: Australian homeowners replacing an older water heater with an eligible heat pump water heater.
- How it works: Get an upfront discount on the quote for the installation. Households can seek incentives from both NSW and Australian Government.
- How to access it: Get multiple quotes to find the best water heater and price for you and complete the required paperwork from your installer.