Victorian Energy Upgrades · Hydronic heating
Hydronic heating rebates are coming to Victoria. Start planning your heat pump upgrade now.
At last, Victoria is creating a rebate made specifically for hydronic heating. The Victorian Government is developing a new Victorian Energy Upgrades (VEU) activity that will directly subsidise replacing gas hydronic boilers with electric heat pumps. If you have gas hydronic heating, now is the time to start planning.
Estimated rebates of up to $7,000*
Until now, homeowners have had to piece together rebates meant for other things, such as hot water heat pump rebates, reverse-cycle air conditioner incentives and federal STCs. The new hydronic activity is designed to fill that gap and help more Victorian households go all-electric and disconnect from gas.
What's happening
The Department of Energy, Environment and Climate Action (DEECA) is adding a dedicated hydronic space heating activity to the Victorian Energy Upgrades program.
- What it's forEncouraging households to replace ageing gas hydronic boilers with high-efficiency air-to-water heat pumps.
- Where it's up toPublic consultation closed on 22 May 2026. After strong support from industry, DEECA published its response and confirmed it will go ahead with the new activity.
- Quality safeguardsDEECA has recommended that the Essential Services Commission set competency requirements for both hydronic system designers and installers, so that only experienced practitioners carry out these upgrades.
- What happens nextThe regulations and product specifications are being finalised. Industry expects the rebates to be available at point of sale in late 2026 or early 2027.
How much could you get?
The amounts haven't been finalised. Current industry estimates are:
UpgradeEstimated rebate*
*These are estimates only. Final amounts and eligibility conditions will be set by the VEU program. A full heat load calculation will be needed to confirm your system is the right size.
That's a big contribution towards the cost of a new system.
Why timing matters
1 March 2027
Victoria's new gas rules start. From that date, a gas hot water system that reaches the end of its life must be replaced with an efficient electric alternative, and rental properties must also replace end-of-life gas heaters (conditions apply). If your hydronic boiler also heats your hot water, these rules may affect you.
Demand for qualified designers and installers is expected to rise sharply once the rebates start. Homes that already have their design and quotes ready will be first in line, and won't be forced into a rushed decision when an old boiler fails in the middle of winter.
How GreenEdge Systems helps you prepare
GreenEdge Systems is an independent consultancy. We work with homeowners, architects and builders. We don't sell products, so our recommendations aren't driven by commission. Every product we recommend must meet our strict criteria (see our hydronic heat pump standards).
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Free discovery call
We talk through your home, your current system and your goals, and explain how we work.
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Project appraisal (around $350 for a typical home changeover)
- An assessment of the energy your current system uses, plus a full heat load calculation
- Recommendations for at least two accredited heat pump brands that suit your home
- Product specifications and options, such as whether to include hot water
- A layout plan and a plumbing mud map showing valves, magnetic filters and other key parts
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Trusted installer introduction
We recommend an accredited, independent installer who deals with you directly, gives you a supply-and-install quote and manages the rebate with you once the scheme begins.
Everyone works from the same plan, so there's no room for shortcuts or compromises.
Thinking about more upgrades? We can also plan solar, battery storage, EV chargers, rainwater harvesting and pool heating (extra fees apply), with specialist installers for each.
Common problems we see
Sales pitches instead of advice
Commission-based salespeople push their own products, sometimes poor-quality ones, and promise install dates they can't keep. Many installations then miss winter altogether.
Noisy heat pumps
Loud units in suburban areas can lead to neighbour complaints and council action, sometimes forcing owners to move or limit their unit. We only recommend hydronic heat pumps with a sound pressure level of 59 dB(A) or less at 1 metre.
The wrong refrigerant or flow temperature
We only recommend units that use natural refrigerants and can deliver water at up to 75°C, which suits existing radiators.
Oversized systems
Australia has no standard for sizing hydronic radiators, so some salespeople apply European design conditions to Melbourne homes. The result is an oversized, overpriced system.
The proposed VEU guidelines are a big step forward, but they still allow some lower-quality products. We won't recommend them, and our clients don't accept them.
A new generation of heat pumps is on the way
Several manufacturers are bringing new models to Australia. They're expected to be cheaper, smarter and more versatile than many units on the market today, with heating and cooling options for in-slab systems. To be recommended by GreenEdge Systems, a product must meet strict criteria in line with:
- UK MCS 007
- European ErP Directive
- EN 14825 performance testing
Get ready before the rush
Have your upgrade planned, designed and quoted before the rebates open. Start with a free, no-obligation discovery call.
Or email info@greenedgesystems.com.au