Electrify your hot water for real savings!
Have you wondered how to save money on your energy bills and where to start?
Switching to heat pump hot water is a fantastic option – better for your hip pocket as well as the planet, with an even bigger savings bonus if hot water is your last gas appliance an you can disconnect your gas!
Harry Barber from Electrify Yarra and industry Tim Johnston from Powrhouse gave us an informative webinar on heat pump hot water, filled with practical information on model choice, financials and payback and the practical aspects of how to make the switch happen for you.
- Check out more on Harry’s electrification journey here
- Detailed information from Powrhouse on costs and savings on switching to heat pump hot water here
- Check out Electrify Boroondara’s very comprehensive Hot Water Hub with well researched articles on heat pump basics, tank sizes, savings including a system comparison tool
- Watch the webinar again on YouTube Live – or click through to the bolded chapter point links below
- View the slideset here
- Download the Agenda here for useful links
Why hot water matters
A majority of Victorians use gas-powered hot water – 62% of us, according to Victorian Government figures.
But with gas prices on the rise, we’re paying more and more for our hot showers. Wholesale gas prices have been steadily climbing for decades, and Victorian consumers now have the highest average gas bills in Eastern Australia. In 2026, we’re paying around $1,460 a year on average: already a 5% rise on 2025!
Electrifiying households reduces energy bills and saves gas for harder to abate industrial sectors – hot water is the easiest place to start
Sustainability Victoria calculates that we can cut that bill by around $385 – $465 annually by switching to heat pump hot water. And with a range of rebates and incentives available, it’s cheaper than you’d think to switch! Plus, heat pumps are reliable, long-lasting, and safe – both for you, and for our planet!
Switching to heat pump hot water
Switching your gas hot water to electric is the easiest and cheapest place to start compared to switching your gas heating/cooling or replacing your gas with by installing an induction cooktop – although you can start with a portable induction unit for under $100 though.
Local resident Gus talks about the advantages of his new hot water heat pump system – arriving just in time for his new family member!
What is a heat pump?
Heat pumps are very efficient with similar technology to your fridge. It’s good to set timers to take advantage of cheap or free electricity at midday (depending on your tariff) for even more savings.
Return on investment
You can save $400-600 per year with hot water heat pumps compared to gas, especially if you are elegible for rebates which can be worth around $1500 or in some cases nearly $2000.
If you spent $2000 it is three and a half years for payback – 11% return is not to be sneezed at
Payback and return: a middle priced unit will cost between $1500 -$3000 after rebates, whereas a high priced one will cost $5000 after rebates. If your out of pocket cost was $2000, payback would be around three and a half years, better ROI than the stock market, given $6000 total returns in ten years.
Choosing a system and an installer
It is worth spend time on system choice. Of course, you get what your pay for – but the good news is there a very good quality units at middle prices with installed out of pocket costs at under $2000 with excellent return on investment
All-in-one units are cheaper, whereas split units are quieter, more efficient and more flexible to install
It is not worth going with cheap systems
It’s not worth choosing very cheap systems or bulk installers – there are major issues with product longevity and customer service, with installation firms not honouring warranties, particularly if the brand is no longer supported in Australia.
Given the very affordable price of better units after rebates it is not worth risk being left high and dry by installing a basic unit with inadequate support
High quality, Middle priced systems
iStore, Apricus and Aquatech are examples of very good, middle priced systems.
What about the expensive brands?
Reclaim is top of range but is the price worth it? Evoheat is another top of range brand.
It is worth looking at customer reviews as well price and features – units like Aquatech and Apricus hold up well
Common myths – heat pumps are too noisy
Approaches to noise including middle of day timing, or perhaps adjusting rate of heating.
With such a good rate of return, it’s really not worth waiting till your gas unit dies.
Every day you wait you are losing money.
Configuring your system
Hot water heat pumps can be configured as a single unit or split: All in one units are a bit cheaper, split units last a bit longer, they’re quieter, more efficient and parts can be fixed separately. Tanks sizes, typically calculated at 70-100L per bedroom, are often 270L or 315L. Timers can be preprogrammed or wifi (useful for a holiday house).
All-in-one units are cheaper, whereas split units are quieter, more efficient and more flexible to install
Modern standards on flow and temperature may result in less scalding but sometimes give rise to the idea the heat pumps don’t heat as well, as the owner was an older, high flow, high temperature system that had to be upgraded.
Want to learn more?
Even if you are not a Yarra local you can request a one-one consultation with Electrify Yarra via info@electrifyyarra.org
Owner Experience
David’s experience: David Strang went with an Econova system. After rebates, the installed cost came to just over $1500.
David chose a quality mid price unit from a trusted installer – out of pocket just over $1500
It was worth having a quality retailer due to some warranty issues with the unit turning off occasionally – these have now been fixed.
The Econova unit, with three hour of free lectricity at midday has only a two year payback, and they honoured the warranty
Electrify Boroondara’s Hot Water Hub
Electrify Boroondara’s Hot Water Hub collects essnetial information about electrifying hot water including a system comparison tool and a list of accredited installers
Russell Williams explained about Electrify Boroondara’s Hot Water Hub – many useful articles, product comparisons, lists of retailers who will give good service on heat pumps and weather proof sticker to put on your gas unit.
Electrify Boroondara’s Hot Water Hub can provide names of accredited installers with good service who will not try and keep you locked into gas
Audience Questions
Question One Using heat pump as booster for evacuated tube hot water.
Heat pumps are good at turning cold water into hot water, but not so good with varied starting temperatures. Evacuated tube water temperatures vary wildly including some very hot temperature in summer. There are warranty issues with varied starting temperatures. It better to move to heat pump hot water system
Question Two What about using heat pumps with a hydronic system?
The Panasonic combined unit doesn’t work so well in practice because hydronic systems need very hot water, whereas hot water in our household pipes and taps should not be at a scalding temperature. Plus in summer you have a really over specced system doing your hot water for your taps.
Question Three What about using Boroondara’s Council $2000 rebate with a Viessman Vitocal on the Solar Savers program
This looks like a good quality German company, but it is not well known.
Question Four Dedicated or shared circuits
Some heat pumps can be plugged straight into the existing instant gas hot water plug – no electrician needed, saving $250 -$900. If you were to install a Reclaim, and you had a double story house with hot water a long way from the switchboard, then your costs would go up substantially, due to requiring a dedicated circuit.
Question Five Can a 5 kW solar system run a heat pump off grid?
A heat pump needs 1kW power to be live, so this might be ok with a battery, depending on battery capacity.
Question Six If living alone, but with occasional guests, what about system size?
Options include having a smaller system and changing settings or going with a bigger system in a set and forget approach, however smaller systems are not a lot cheaper to buy, if 270L is standard for some manufacturers, a smaller system might only be $50 cheaper. Aquatechs smaller unit is $300 cheaper.
Question Seven Timer settings
What about leaving open so the unit heats back up in an hour, set it to exclude going to sleep hours to avoid noise, or set it for late morning or midday heating depending on tariff? There is very little financial difference difference as they are very cheap to run, so it is a matter personal preference.
Question Eight Do heat pumps work in cold climates?
Yes they do – freezing point is well above absolute zero, and there is plenty of heat in the air to drive a heat pump. In very cold areas like ACT or Canberra, a Reclaim or similar unit may be worth it – whereas in Melbourne on a cold winter morning at 5°C an Aquatech or Apricus would be fine.