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Phase-out of greenhouse intensive hot water heaters

Standard electric hot water heaters are used by about half of Australia's eight million households. They produce up to three times the greenhouse gas emissions of low emission technologies such as gas, solar and heat pump systems.

As energy prices continue to rise and put added pressure onto the lives of Australians, it is growing more important to seize opportunities to reduce energy consumption. Electric water heaters account for about a quarter of household energy use, as well as the same in greenhouse gas emissions. By changing your electric water heater for a low emission gas, heat pump or solar system, you can reduce your energy consumption, cut your greenhouse gas emissions and save money on your power bills.

The Australian Government has been working with the state and territory governments to phase out greenhouse intensive hot water systems. An extensive research and cost benefit process has shown that by installing a low emission water heater, households will save energy, reduce greenhouse gas emissions and be financially better off over the life of the system.

In December 2010, all states and territories except Tasmania agreed to phase out greenhouse intensive (electric) hot water systems. Each state and territory is responsible for implementing regulations on a jurisdictional basis.

This phase-out will result in the reduction of greenhouse gases by about 51.1 million tonnes over ten years – the equivalent of taking 1.4 million cars off the road for the same period. This single measure undertaken by Australian households will deliver four percent of Australia's current projected greenhouse gas abatement by 2020; a significant contribution to reducing our greenhouse gas emissions.

Phase-out status

Some restrictions are already in place regarding the installation of greenhouse intensive water heaters in new detached, terrace, row and town houses (Class 1 buildings under the Building Code of Australia 2010). These regulations apply in Australian Capital Territory, South Australia and Western Australia.

Victoria’s 6 Star standard for buildings incorporates some hot water provisions. New South Wales also employs comparable standards through the BASIX program.

Existing houses must be regulated through changes to state and territory plumbing regulations, and commencement dates are dependent on individual jurisdictions’ decisions.

The New South Wales and Queensland governments have chosen not to implement the phase-out.

South Australia has commenced their program for existing houses with some restrictions on water heater replacements based on metro/regional locality. Please see the below links for more detailed information.

Rebates and incentives are available

Incentives in the form of rebates and Small-scale Technology Certificates (STCs) - formerly known as renewable energy certificates or RECs - are available to assist households in the switch to low emission hot water heaters.

Some state or territories may offer rebates for low emission water heaters

Industry support

To support an effective transition by industry and consumers to low emission domestic water heaters, a training package for industry has been developed. States and territories are responsible for implementation. Online training material for the plumbing industry is available.

Next stages

Research into the feasibility of extending the program to cover new Class 2 buildings (apartments, flats and high rises) has been postponed at this stage. It may be considered again in the future.

Further information 

Find out details relevant to your state or territory: