The Victorian Energy Upgrades (VEU) scheme was introduced in 2009, and it was stated to run till 2029. In 2023, the state government extended it to 2030 to align the program’s goals with the Climate Action Targets of the state government, to achieve 75 to 80 percent reduction in carbon emissions below the 2005 levels.
With the Victorian Energy Efficiency Target Amendment (Energy Upgrades for the Future) Bill 2025, the VEU program is set to be extended till 2045, to meet the net-zero emissions target of the state government.
The transition from traditional gas-fired and electric resistance water heaters to air source heat pump technology based water heaters is a significant part of the VEU program initiative. It aims to reduce greenhouse gas emissions, energy costs, and lower overall energy demand of Victorian households and businesses.
The air source heat pump water heaters have gained immense popularity in the state and across Australia. Heat pumps offer several advantages over the conventional water heaters, such as:
- Heat pumps are cheaper to run. The running cost of a heat pump hot water unit is less than half of its electric equivalent.
- They have a longer lifespan than gas-fired and electric water heaters.
- Offers 300-500 percent energy efficiency (gas fired water heaters are just 60 percent and electric resistance 90 percent efficient).
- Heat pumps are eligible for rebates under the VEU program.
- Lower standing loss than electric water heaters.
- In-built features such as control humidity, smart home integration, Wi-Fi monitoring and control.
Due to such standout features, the adoption of air source heat pump powered water heaters is booming in Australia.
Along with this boom came the shoddy installation of air source heat pumps under the state government energy efficiency schemes like VEU and hot water rebate under Solar Victoria.
While users have consistently flagged the poor durability and performance of some air source heat pump water heating units (specifically, Midea and Chromagen), the quality of installation is a determining factor.
The rebates under state government schemes have significantly reduced upfront costs of heat pump hot water units, but poor installations is the major reason behind some units becoming non-functional within 3 to 5 years of installation.
Moreover, heat pump units are difficult to repair than their gas and heating element based electric water heaters.
Over the last few years, our team has installed heat pump water heaters in domestic and commercial premises across Victoria state.
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The following are the most effective practices we follow to guarantee the quality of heat pump unit installations. We adhere to the safety and installation guidelines and standards of the VEU program, Victorian Building Authority (VBA), and relevant AS/NZS plumbing and electrical standards (including AS/NZS 3000:2018, AS/NZS 3000:2018, AS/NZS 3500.4:2021) 3500.4).
Install the unit as per OEM manual
- Follow the Original Equipment Manufacture (OEM) instruction manual for installation.
- Ensure minimum clearance for airflow and maintenance, as mentioned in the manufacturer’s manual. Install the unit in a well ventilated space.
- Install the compressor unit in outdoor to minimize buzzing sound coming out of it.
Insulate the pipes, valves and fittings
- To maintain energy efficiency, prevent pipes from freezing during winter and minimize heat loss, make sure hot water pipes (foil-covered insulation is recommended), valves, and fittings are properly insulated.
Install drain pipes
- Connect a drain pipe from temperature & pressure relief (TPR) valve and condensate drain so that condensate and hot water overflow don’t wet the floor or ground.
- The drain lines must also have an air gap of at least twice the diameter of the drain pipe.
- There shall be no restriction (bend, tap, or valve) in drain line. The line must fall continuously from TPR valve to the point of discharge, say stormwater drain.
- The point of discharge should not affect the building foundation and there shall be an optimum clearance between drain pipe termination point and the drain.
Mount the water tank on a stable base
- The water storage tank must be mounted on a stable and level surface.
- Install a concrete slab that is large enough for the base of the heat pump water tank.
Electrical safety
- Hire a licensed electrician (certified by Energy Safe).
- Use a dedicated circuit for hot water unit.
- Ensure proper grounding of the heat pump system.
- Connect the unit to a dedicated power surge protector or whole house surge protector.
Maintenance
- Clean air filter regularly (in every 4 to 6 months)
- To prevent sediment buildup, flush the water tank once a year.
- To prevent water tank corrosion, replace the anode rod in every 2 to 3 years.
Safety
- Install a temperature and pressure relief valve and connect it to a drain pipe.
- Keep flammable materials away from the unit.
- Use fire-resistant wall material.
- Secure the water tank to wall studs to prevent tipping.
- Ensure optimum space above the water storage tank so that anode can be pulled out easily.
- Ensure a licensed A-grade electrician hardwires the unit to a dedicated circuit and circuit breaker.
- Ensure all the wires are properly labelled and secured with clips or zip-ties.
- Set temperature in safe range, in 49C to 55C range. Higher than 55C can cause scalding and lower than 49C can increases risk of bacteria.
- Hire a VBA certified plumber for plumbing work.
- Cross connection control and backflow prevention devices are installed in accordance with AS/NZS 3500:1.2021 standard.
- The refrigerant handling work must be undertaken by a person licensed by the Australian Refrigeration Council (ARC).