Heat Pump Water Heater Upgrade in Victoria

Heat Pump Water Heater Systems Upgrade in Victoria

The Victoria state government recently introduced heat pump activities (44A, 44B, 44C) as a part of the Victorian Energy Upgrades (VEU) program. This initiative allows homeowners and businesses in Victoria to replace their electric or gas-fired water heaters with exceptionally energy-efficient air source based heat pump water heating systems for free.

By participating in this voluntary activity, Victorians can significantly reduce their water heating bills while also making environmentally-friendly choices in line with the goals of the VEU rebate program and the state climate action targets.

Replace electric/gas water heater with air-sourced heat pump

Air-sourced heat pumps are 2 to 3 times more energy-efficient than conventional electric and gas-fired water heaters, making the switch to heat pumps an evident (and earth-friendly) choice. This upgrade is also a financially prudent (and feasible) choice for homeowners and businesses in Victoria.
For example, a case study conducted by the Australia Renewable Energy Agency (ARENA) in August 2022 found that a business in Kyneton, located in central Victoria, slashed their energy costs on water heating and saved over $500,000 in a year by replacing their water heater with a heat pump powered water heating system, coupled with a high voltage power supply upgrade.

Who are eligible for free hot water system upgrade?

Businesses in Victoria with electric or natural gas-powered water heaters are eligible for a government-sponsored free upgrade to a heat pump-driven hot water system. To be eligible, the upgrade must be undertaken at:

• A business/non-residential premises
• The common areas of a building that is classified under Part A6 of Volume One of the Building
• Class 2 building (i.e., common area of a multi-residential building)

Is the replacement completely free?

Yes. The hot water heat pump upgrade is free in Victoria if it is done under the VEU scheme – which is a carbon emission reduction scheme legislated by the Victorian government.

How to claim the rebate?

To claim the rebate on a hot water system upgrade or replacement in Victoria, follow these steps:

1. Get in touch with us
2. Share your business address and property ownership document
3. We will send a licensed plumber to assess the site and discuss the process and timeline of the upgrade
4. Once the assessment is done, the old water heater will be decommissioned
5. Installation by a team of VBA (Victoria Building Authority) licensed plumbers and A Grade licensed (by Energy Safe Victoria) electricians of a new integrated heat pump water heater
6. We will claim the rebate on your behalf
7. Start saving!

What is an air source heat pump driven hot water heater?

An air source heat pump uses electricity to extract ambient heat and utilize it to heat the water. Unlike conventional gas and electric water heaters that heat water by using electricity or burning gas, heat pump don’t generate heat per se. It just moves it from one place to another.

How does the system work?

A heat pump water heater works by extracting heat from the air and transferring it to the water in the tank. An air-sourced water heater system consist of a power cable, a fan to draw in ambient air and push it through evaporator coils filled with refrigerant to absorb the heat, a compressor to compress the refrigerant liquid and increase its temperature, evaporator coils, condenser coils to deliver the heat to water, storage tank to store the heated water, cold water inlet, hot water outlet, and an expansion valve to reduce the pressure (and temperature) of the refrigerant liquid. The refrigerant liquid is channelled back to the evaporator coils.

Types of heat pump driven water heaters

We can classify heat pumps into three major groups:

• Air source heat pumps (ASHPs)
• Absorption heat pumps
• Ground source (or Geothermal) heat pumps (GSHPs)

Air source heat pumps

ASHPs work by using a refrigeration cycle to transfer heat from the air outside the building to the inside of the building. These pumps are much more efficient than typical electric resistance water heaters.

Ground source heat pumps (GSHPs)

Geothermal (ground-source or water-source) heat pumps use soil as the source of heat. Loop pipes are dug into the ground about six feet deep, where the temperature stays constant throughout the year and becomes an efficient heat source.

Absorption heat pumps (AHPs)

Absorption heat pumps (AHPs) that use a different type of mechanism to transfer heat compared to air source heat pumps. Instead of using a refrigeration cycle like ASHPs, AHPs use a chemical process to transfer heat from one place to another.

Advantages of heat pumps over conventional water heaters

• Free upgrade under VEU program
• Heat pump water heaters are more efficient than conventional electric resistance and natural gas water heaters
• Environment-friendly: heat pumps are more environmentally friendly than conventional water heaters, which can emit greenhouse gases and contribute to air pollution.
• Low maintenance cost
• Heat pumps can provide both heating and cooling, making them a versatile solution for year-round climate control
• Longer lifespan
• Safer than conventional heaters

How to choose a heat pump water heater?

Here are some major factors that you need to consider when switching from a gas/electric water heater to a heat pump:

• Size
• Types of water heaters
• Energy-efficiency
• COP (Coefficient Of Performance)
• Heating capacity
• Smooth functioning
• Flow rate in case of tankless ASHP water heater
• First hour rating

Can heat pumps work in cold climates?

These systems are capable enough for performing in bone-freezing conditions, even if the temperature drops to 25°C degrees thanks to advanced refrigeration technology. Heat pumps we install under the VEU program are modern and use lower boiling point refrigerant liquid, and such refrigerants draw heat from sub-zero ambient temperature and continue to flow through the evaporator coils of the heat pump.

Factors that affect the performance of heat pumps

Here are some major factors:

• Frequent changes in temperature set point
• Compressor type
• Lack of maintenance
• Leaks
• Size
• Improper wiring
• Uninsulated water tank

Things to consider before installing heat pump hot water systems

An installer should consider things before the installation:

1. Check the space and location: Make sure it has sufficient volume of space and the surface is firm.
2. Exhaust fan positioning: Before the installation, should check the interior of your place and where you plan to position the exhaust fan.
3. Tank size: Another important factor you need to consider is the size of the heat pump tank. Make sure your tank has sufficient water storage capacity.
4. Airflow.
5. Keep the heat pump system upright even during the installation.

After the installation:

1. Your system is working fine.
2. Make sure there are no exposed wires.

How to choose among different sizes of heat pumps?

If your hot water usage is more than that, then you should opt higher tank size heat pump. Because, if you pick a small size tank, you’ll run out of hot water. We suggest that you upgrade the size of your tank over the current tank.
Heat pump size selection:

1. Small (Tank size of 170–200 litres)
2. Medium (Tank size of 215–250 litres)
3. Large (Tank size of >300 litres)