Most people don’t realise there are three rebates for hot water
If your hot water system is electric or gas, and more than a few years old, there’s a good chance it’s chewing through your energy or gas bill.
The good news? You may be eligible for up to three separate rebates when upgrading to a modern, energy-efficient heat pump hot water system. And depending on your setup, that could mean $2,000 off your install.
Here’s how it works.
The three rebates you can claim
1. Solar Victoria Rebate
- $1,000 standard
- $1,400 if you choose an Australian-made product
- Means-tested: household income under $210,000
- Property must be valued under $3 million
- You can only claim this once per household
2. STCs (Small-scale Technology Certificates)
- Federal scheme
- Applied as an upfront discount by your installer
- Worth around $700 as of June 2025
- Value decreases every calendar year
3. VEECs (Victorian Energy Efficiency Certificates)
- State-based scheme
- Worth around $300–$500, depending on your current system
- Also decreases each year
- Applied as an upfront discount
When stacked correctly, these three rebates can take thousands off the cost of a high-efficiency, low-running-cost system and dramatically reduce your electricity or gas bills from day one.
Which systems qualify?
Not all hot water upgrades are equal. To qualify for all three rebates, you’ll usually need to:
- Replace an electric storage or gas hot water system
- Install an eligible heat pump hot water unit (not just a regular electric system)
- Use an accredited installer
If you’re currently on bottled gas, mains gas, or an old electric storage unit, this upgrade could be a huge win for your comfort and your wallet.
What about solar hot water?
If you’ve had solar hot water before or know someone who has, you might be feeling a bit sceptical. And honestly? You’re not wrong.
We speak to homeowners all the time who installed solar hot water in the past, only to be left disappointed. While the intention was good (and it certainly helped boost energy ratings on new homes), the performance in our local area has been… disappointing.
Here’s why:
- In the Macedon Ranges, frost and cold winters can wreak havoc on rooftop solar hot water panels
- We’ve seen cracks, leaks, broken valves, and frequent maintenance issues
- And because the sun often isn’t shining when you need hot water most (early mornings, winter evenings), many systems rely on electric or gas backup anyway
Rarely do you hear a glowing review. It’s a very different technology from the home solar that we recommend, and unfortunately, it’s often confused with it.
Why heat pump hot water is different
A heat pump hot water system uses ambient air (even in cold weather) to efficiently heat water, similar to how a reverse-cycle air conditioner works. And unlike solar hot water, the unit stays on the ground, so there are no roof components to freeze or crack.
And here’s the magic:
Because it runs on electricity, a heat pump can be powered by your home solar system. That means you can enjoy reliable hot water all year round without relying on the grid.
In fact, many of our clients who’ve upgraded from old solar or gas hot water systems say their new heat pump is one of the best decisions they’ve made. Efficient, reliable, and uses the solar they’ve already invested in.
It’s not just a replacement. It’s an upgrade that fits perfectly into an all-electric home.
Why home solar and heat pumps were made for each other
Heat pumps are the perfect match for home solar because they’re designed to do more with less. Compared to traditional electric hot water systems, they use 75% less power, drawing energy slowly and efficiently throughout the day.
That’s where the magic happens with solar.
A heat pump’s energy use sits neatly under the curve of a typical solar production profile, especially during daylight hours when your panels are producing the most. Many models even include smart settings that let you prioritise daytime operation, so you’re automatically using your excess solar instead of buying from the grid.
It’s a clever way to stretch every kilowatt-hour further, without compromising on your comfort. You produce the energy with your panels, and your heat pump uses it efficiently to keep your hot water topped up—no waste, no spikes, no stress.
It’s one of the simplest upgrades that makes your home work smarter, not harder.
A real example
Let’s say a household in Sunbury upgrades from an old electric hot water system to a Reclaim or iStore heat pump, which qualifies for all three rebates:
- $1,000 Solar Vic rebate
- Around $700 in STCs (as of June 2025)
- $300–$500 in VEECs, depending on the existing system
That’s up to $2,600 off—and the new unit uses around 75% less energy than their old one.
A faster recovery time, compared to traditional electric and a dramatic reduction in power usage, especially when paired with solar.
One important warning
If your hot water system is inside or hard to access, removing and decommissioning it can come with extra plumbing costs. This is why it’s important to work with someone who understands:
- The rebate system
- The technical installation requirements
- And the balance between savings and smart design
We’ll always give you a clear picture upfront, so you’re not caught out.
Can you stack this with other rebates?
Yes! Upgrading your hot water system won’t affect your eligibility for solar, battery or heating and cooling rebates.
That means you can:
- Claim hot water rebates now
- Still install solar and battery later
- Or do it all at once and maximise your total rebate support
Still got questions?
There’s a lot of small print with hot water rebates, but when you understand how they work together, the benefits are huge.
If your system is nearing the end of its life, or you’re planning a whole-home upgrade, this is one of the smartest and most overlooked ways to lower your bills.
Book your free rebate consult here or call us on (03) 5426 5522.
No pushy sales talk, just honest advice from someone who’s done this for families across Gisborne, Woodend, Sunbury and the Macedon Ranges that has a heat pump at home.