Hot water rebates

There are a number of rebate schemes available for high-efficiency, low-emission hot water heaters. The rebates depend on a few factors, including:

  • the type of heater you’re replacing
  • the type of the heater you’re buying
  • whether it’s a new system or a retrofit, and
  • which state you’re in.

Determining eligibility and taking advantage of rebates is generally quite easy, with most major hot water system manufacturers now offering purpose-built rebate calculators to help you calculate your rebate entitlements. Depending on where you live, the combined value of the rebates may even cover most of the cost of a complete new solar hot water system.


Federal hot water rebates

Up until February 28th, 2012, the Federal Government had a Renewable Energy Bonus Scheme (REBS) in place which provided a flat bonus of $1000 for a solar hot water system or $600 for a heat pump system when it replaced an existing electric storage system. The scheme was cancelled, with the final claims under the REBS being honoured no later than 30th June 2012.

Discussion is still underway in parliament by various parties to try and reinstate the REBS.

New homes (apart from rebuilds constructed as a result of the Victorian bushfires) were not included in this rebate scheme, and nor were households that had previously claimed the ceiling insulation rebate offered by the government.


To be eligible for a rebate from the Federal Government under the REBS, the hot water system you install needed to:

  • replace an existing electric storage hot water system
  • be a solar or heat pump hot water system eligible for at least 20 STCs (Small-scale Tehnology Certificates) – as explained below
  • be purchased and installed on or after the announcement date (19 Feb 2010), and no later than 28 Feb 2012.
  • be installed in a new home that was eligible to receive the rebate under the Victorian Bushfire Appeal Destroyed Homes Fund.

STCs and RECs

STCs (Small-scale Technology Certificates) are a type of REC (Renewable Energy Certificate) rebate offered by the federal government for various renewable energy measures, including installing solar hot water systems. The amount you receive depends on two things; the efficiency of the system you’re installing and the climate zone you live in. STCs are available for hot water heaters installed in both new and existing homes.

STCs are a little like an environmental currency; one STC is equal to one megawatt hour (MWh) of power saved. Other parties purchase STCs as a means of offsetting their excess electricity usage. The value of an STC fluctuates depending on market forces, and can change daily.

To exchange STCs for cash, you can go through an agent to trade them on the market, go through your hot water system retailer and trade the STCs as a discount on your purchase, or you can hold onto them and claim them yourself. Claiming your own STCs is a difficult and time consuming process though, and often the change in value is not worth the time invested for the relatively small amount of STCs received for a hot water system purchase.

  • The person claiming must be the owner of the system at the time of installation.
  • The solar or heat pump hot water system being purchased must be a complete model, which is listed in the Register of Solar Hot Water Heaters.
  • The rebate must be claimed within 12 months of the completion of the installation.


State hot water rebates

Each state is offering a hot water system rebate in addition to the one offered by the Federal Government. There are a number of eligibility criteria and none of the schemes are quite the same, so it is difficult to compare them all together. To determine your eligibility, however, many of the major hot water system manufacturers offer rebate calculators which will automatically calculate your rebate entitlements based on your post code.