Hot water systems for households

Water heating can account for 18% of your energy bill. It's possible to reduce these costs by upgrading to a more efficient hot water system.

The Victorian Energy Upgrades (VEU) program provides incentives for households to replace inefficient electric storage, gas storage or gas instantaneous hot water systems.

Eligibility

To be eligible to upgrade your hot water system and get a discount, you must:

• be a Victorian household
• have an inefficient electric or gas hot water system.

Your participation is voluntary.

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.

New upgrades available

With this new activity, you can now replace inefficient gas storage and instantaneous hot water systems under the VEU program.

Only products meeting the VEU program requirements can be installed under this program. There are two types of efficient hot water systems you can install under the VEU program:

• heat pump hot water systems
• electric boosted solar hot water systems.

How to size your new hot water system

It is important to choose a hot water system that is a suitable size for your household. Every household is unique, and this impacts what size is appropriate. You can run out of hot water if your system is too small.

We recommend reviewing our guidance to help you choose the right hot water system for your home.

VEU water heating factsheet

We have created a handy factsheet to assist you in selecting the right size hot water system. This factsheet will also be provided to you if you undertake a hot water system upgrade under the VEU program.

Key steps when organising a hot water system installation

To get a discount on the installation of a hot water system you must:

1. install an approved product.Under the products register, you can use the ‘Product’ drop-down menu to search for the product you intend to install, including:

• water heater – heat pump
• water heater – electric boosted solar.
  Hint: Research these products for their suitability and quality. There are a lot of products approved for installation as part of VEU. Not all products are of the same quality or suitable for every environment.

2. work with an accredited provider
   Hint: Get quotes from several providers. Accredited providers offer different types of products, services, expertise, and costs. Make sure to get a quote from several accredited providers on the final installed price of the appliance, which includes the discount.
3. decommission an inefficient electric or gas hot water system.

Working with accredited providers

An accredited provider is:

• any business that is approved to deliver or facilitate installations in the VEU program
• responsible for helping you get a discount on an installed appliance through the VEU program.

When doing an installation through the VEU program, accredited providers can either:

• use their own tradesperson, or
• work with a tradesperson of your choice.

Accredited providers will be able to explain:

• the steps to take part in the program
• the types of products can you install to get a discount
• the necessary qualifications of the tradesperson who installs the hot water system.

Remember: you must work with an accredited provider to get a discount on an installed appliance through the VEU program.

How to check if a person or business is accredited under the VEU program

The Essential Services Commission’s VEU Registry of Accredited Persons:

• select the 'Business Name' drop-down menu
• scroll until you see the accredited provider you are searching for.

Note: accredited providers often work with installers who are not listed on the registry.

How much discount you can expect

Incentives of up to the following amounts are available for the average household:

Removing an inefficient electric water heater

Removing an inefficient gas water heater

*This figure is based on a certificate price of $70.

The final installed price of the appliance, which includes the discount, is up to the accredited provider and will depend on several factors, including:

• certificate price (which fluctuates)
• location
• installation costs
• the accredited provider’s administrative costs.

For more information on the certificate price under the VEU program, please see Victorian Energy Efficiency Certificates (VEECs).

Can't find an accredited provider in your area?

Please note that as VEU is a market-based program:

• not all accredited providers listed below will necessarily be offering hot water system upgrades at present
• accredited providers can choose when and where they undertake upgrades.

Page last updated: 15/02/24