In this era of rising costs of living, managing a business can be a costly affair, as the prices of all commodities have soared to unprecedented levels. Reducing business and household operating costs has become essential for household and business’ financial stability.
Businesses (esp businesses in hospitality sectors like hotels, cafés, and bakeries) rely on hot water systems for their everyday business activities.
Energy consumption by hot water systems forms a large part of the energy usage pie of businesses in hospitality sector and hospitals and clinics. Reducing energy usages of hot water systems becomes essentials for such businesses.
In Australia, most businesses use electric or gas powered water heating system. To help these business in reducing their energy costs, various states governments are offering rebates/incentives to upgrade their existing (gas/electric) hot water systems with their energy-efficient counterparts — heat pump powered water heating systems.
Before discussing the rebates part, let's understand what a heat pump is and how it works?
What a heat pump is and how it works?
A heat pump water heater works by transferring heat from one place to another rather than generating heat directly. It uses electricity to move heat from the surrounding air or ground into the water, which is then stored in a tank for use.
This process is more efficient than traditional electric water heaters, which generate heat by using electricity to heat a resistive element, because heat pumps can move more heat with less energy.
There are two main types of heat pump water heaters:
- Air-source and ground-source. Air-source units extract heat from the surrounding air.
- Ground-source units extract heat from the ground.
Different incentives and rebates are being offered by Australian states to reduce the upfront cost of the heat pump systems and reducing building emissions from workplaces and homes.
Let’s compare different state programs for hot water system upgrades.
Victoria Hot Water Rebates
Businesses in Victoria can replace their existing gas or electric hot water systems with discounted/rebated heat pump powered water heaters under the Victorian Energy Upgrades program of the state of Victoria.
Who can apply for rebates?
- Any business (with an active ABN) located in Victoria state
- Businesses who have an electric/gas powered hot water system.
Conditions
- To be eligible for the rebate, the heat pump hot water system must be approved under the VEU program.
- The installation/upgrade must be conducted through an VEU program accredited business
NSW hot water rebates
Under the ESS (Energy Savings Scheme) program of the Independent Pricing and Regulatory Tribunal (IPART) of the government of New South Wales, businesses in NSW can:
- Upgrade their electric water heaters to discounted air-source heat pump powered water heaters under activity D17 of ESS program.
- Upgrade their gas powered water heaters to discounted air-source heat pump water heaters under activity D19 of ESS program.
Who can apply for rebates?
- Any business (with an active ABN) located in NSW state
- Businesses who have an electric/gas powered hot water system.
Conditions
- To be eligible for the rebate, the heat pump hot water system must be approved under the IPART ESS program.
- The installation/upgrade must be conducted through an ESS program accredited business.
QLD hot water rebates
Businesses in Queensland can apply for hot water rebates under QBEST Program For Small & Medium-Sized Businesses. Under this program, small and medium-sized businesses in Queensland can avail an appliance rebate up to 50% of the total cost (product+installation) of installing a new approved appliance (such as air source heat pump hot water system, air-conditioner, display fridge/freezer, dishwater etc).
Who can apply for rebates?
A small and medium-sized Queensland business interested in applying for QBEST appliance rebate must:
- Hold an active ABN (Australian Business Number). Businesses with multiple locations under a single ABN and businesses with multiple locations with different ABNs are eligible to apply for the QBEST rebates.
- Be registered with Australian Taxation Office (ATO) for GST.
- Not be a public company.
- Employ at least 2 and maximum 199 full-time employees.
- Not have received rebates/government funding for the appliance in the past.
Conditions
- To be eligible for the rebate, the heat pump hot water system must be approved under the QBEST program.
- The installation/upgrade must be conducted through an QBEST program accredited business.
SA hot water rebates
Businesses in South Australia can avail hot water rebates through:
- Small-scale Technology Certificates (STCs): up to $1150 rebate can be availed.
- Retailer Energy Productivity Scheme (REPS): up to $1056 rebate can be availed.
Tasmania hot water rebates
From 17 October 2022, Tasmanian small businesses can avail an interest free loan of $500 to $10,000 for the period of three years under the Energy Saver Loan Scheme. The interest-free loan can be utilized to purchase energy-efficient appliances like:
- Heat pump hot water systems
- Rooftop solar panels
- Battery storage systems
- Solar hot water systems
- Building upgrades (window double glazing and insulation)
The scheme will end on 17 October 2025.
Tips for choosing discounted hot water system under rebate programs
A business can apply for state/federal rebates only for once. So, choosing a suitable and quality hot water system becomes essential. Here are some tips for applying for rebates and picking an ideal hot water system for your business.
- Get quotes of hot water system from different accredited business: There are many businesses accredited for providing hot water rebates and installing the hot water system. Get the quotes from multiple accredited businesses and compare them.
- Google the hot water system offered to you by an accredited installer. Read its user reviews on forums like Whirlpool, or ask about the unit from your friends or neighbours.
- Pick the size of hot water system according to your daily hot water needs.
- Pick the size of hot water system according to your daily hot water needs.
- Think about your future hot water daily consumption when selecting a system. If you plan to expand your business, you may need a larger hot water system.