Singing in the shower
A guide to using cheap and efficient hot water in your home.
Your hot water system may not be an exciting conversation starter but simply getting the right system will reduce your energy costs at home and will play a key role in our electric future.
Installing an efficient shower head can also drastically reduce your hot water energy requirements.
The humble hero
While hot water is a big energy user, it is also one of the most flexible household loads on the grid meaning it can play a big role in a more efficient and clean energy landscape. Unlike an appliance like your stove which you use at a certain time, with a good electric heat pump you can choose when your system heats your water and consumes energy.
This control can benefit both your energy bills and the grid, as your hot water tank effectively acts as a large cheap home battery. You can store energy as hot water when electricity rates are lower, or if you have solar panels you can heat your water when you’re producing solar power, making free hot water with zero emissions. When we consider all our hot water systems together, they become an important piece of technology to combat our domestic emissions.
By using more efficient electric hot water systems, and using them smarter, we can create a cheaper and cleaner electricity grid for everyone.
Did you know water heating is one of the biggest source of carbon emissions in Victorian homes, responsible for a quarter of all energy use.
Types of Hot Water Systems
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Heat Pumps
Recommended. Heat pumps transfer heat from the surrounding air to heat the water which makes them highly efficient, typically using up to 65-75% less energy compared to electric resistance heaters. They work best in moderate to warm climates like we have in Victoria.
Generally they have a higher upfront cost. However, this is partially offset with current government rebates and they can save you money in the long run through reduced energy consumption.
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Electric Resistance Heaters
Electric resistance heaters use electricity to heat an element like a large kettle. They are relatively inexpensive to purchase, install and service, however, they use roughly 3 to 4 times more electricity than a heat pump.
If you have a good-sized solar PV system then a decent solution can be installing a timer or smart device to ensure your water heats during the day, rather than the typical overnight “off peak” setting.
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Gas Water Heaters
Gas systems use fossil gas or LPG as a fuel source. They are relatively cheap to run however their emissions contribute to air pollution and fuel climate change which is why we do not support the installation of gas appliances. They also require venting and maintenance for safety as they are burning a combustible fuel.
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Solar Thermal Heaters
Not to be confused with solar PV panels, which generate electricity, for a long time solar thermal hot water systems were considered the cheapest form of solar hot water heating in Australia. However, the hugely reduced cost of solar PV means this is no longer the case and the solar thermal system is expensive and inefficient.
Government Incentives Available
Currently there are both State and Federal Government rebates or incentives for installing heat pump hot water systems, which you are entitled to use together. These are:
Federal: Small-scale Technology Certificates (STCs) can be generated for solar hot water (most installers can claim STCs on your behalf) to reduce the cost of a system. You will receive more STCs for a more efficient hot water system.
State: Solar Victoria offers a rebate of up to $1,000 is available on eligible heat pump and hot water systems (with some eligibility criteria). It is a 50% rebate on the purchase price of the system up to the value of $1000. Learn More.
State: The Victorian Energy Upgrades Program (VEU). Through this program rebates are offered to replace inefficient gas or electric hot water systems with efficient alternatives, such as a heat pump. Rebate amounts vary depending on the brand of heat pump installed. Learn More.
How much will you receive?
Unfortunately it’s not a simple amount paid to you and the system is quite complicated and not one you undertake yourself (the licensed installer does it on your behalf as they work with certificate trading schemes). How much you receive off your new heat pump system depends on a range of factors such as what you’re switching from and the efficiency of the new system you choose.
How to claim the rebates
Research what type of hot water system you may want and potential products
Connect with one or more installers for a quote and to discuss the most suitable system for you. Confirm that they are licensed to claim the rebates for you.
The installer will organise the installation and rebate so you receive a reduced final bill.
Heat Pump Considerations
Below we have provided a guide of some reviewed options from the top to the lower end of the market. There is a huge range in price (anywhere between $1500 - $5500 before rebates). Typically the more expensive heat pumps are quieter, use less electricity, have better warranties and use more environmentally friendly refrigerants than their cheaper counterparts.
We encourage you to consider the following elements when making your choice:
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If a model has a timer or wifi/wired control it will enable you to time when you heat your water so it can be run off your solar power. This is the optimal method to heat your water from an emissions and cost savings viewpoint.
For instance, the Reclaim Heat Pump has a hardwired option which you can connect to other smart devices to divert excess solar power to your hot water. Most options however use a simple timer so you can set it to run when you have cheap power or are likely to be exporting solar power.
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Whether you choose a split or all-in-one tank may depend what room you have. The split system will have a separate larger compressor which heats water more quickly but takes up more space.
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Look for a high coefficient of performance (COP) rating, indicating greater energy efficiency. The more efficient, the less energy used and therefore lower running costs
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A resistive element, found in some heat pumps add the ability to reheat quickly (but use more power). It’s potentially useful for larger households looking for a smaller tank installation.
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Some refrigerants are greenhouse gasses. CO2 and R290 refrigerants are good choices for the environment while R410a and R134a are being banned in various regions.
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Warranties are complex with different periods that cover for labor, tank and parts. Also note that the distance from an approved service agent may add to repair costs.
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Some Heat Pumps can be noisy like a reverse air conditioner, so consider your neighbours and how close it maybe to any windows.
Other things to note:
Hot water systems by law need to be on their own circuit breaker which may require an electrician to install a new RCD and wiring.
The listed brands in our comparison guide is not a complete list of brands to consider and we are not affiliated with any company.
There are other reputable companies that make good heat pumps which are well reviewed online. These include and not limited to Quantum, Rheem, Thermann, Enviroheat, iStore, Thermal Ark, Solahart, Dux, Stiebel Eltron, HydroTherm, Apricus, Rinnai, Eco Alliance. For more information and reviews we recommend searching the My Efficient Electric Home (MEEH) forum on facebook.
Heat Pump Comparison
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Top range: Reclaim
Price: $$$
Control : Timer, Wifi and Hardwire option
Design: Seperate tank and controller
Efficiency: 5:1
Capacity (litres): 160, 250, 315, 400
Resistive Element: No
Refrigerant: CO2
Warranty: 4 Stars
Noise: 37 db
Notable Feature: Options to work with Solar PV, Australian and Japanese made
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Top range: Sanden
Price: $$$$
Control : Timer, Wifi option
Design: Seperate tank
Efficiency: 5:1
Capacity (litres): 160, 250, 300, 315
Resistive Element: No
Refrigerant: CO2
Warranty: 4 Stars
Noise: 37 db
Notable Feature: Australian made tank, Japanese Compressor
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Mid range: Aquatech
Price: $$$
Control : Timer and Wifi
Design: all in one
Efficiency: 4.25:1
Capacity (litres): 210
Resistive Element: Yes
Refrigerant: R290
Warranty: 3.5 Stars
Noise: 43 db
Notable Feature: Wifi with ap connectivity
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Mid range: Evo Heat
Price: $$$
Control : Timer, Wifi optional
Design: All in one
Efficiency: 4.27:1
Capacity (litres): 270
Resistive Element: Yes
Refrigerant: R410a
Warranty: 3 Stars
Noise: 48 db
Notable Feature: Compact Unit, LED timer
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Low range: Midea
Price: $
Control : Timer only
Design: All in one
Efficiency: 3.5:1
Capacity (litres): 170, 280
Resistive Element: Yes
Refrigerant: R134a
Warranty: 2 Stars
Noise: 48 db
Notable Feature: Low price
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Non-heat pump: Electric resistive
Price: $$ (no rebates)
Control : Not included
Design: All in one
Efficiency: 1:1
Capacity (litres): All sizes
Resistive Element: Yes
Refrigerant: No compressor
Warranty: 2-5 Stars
Noise: 0 db
Notable Feature: Low price, simplicity