$33 Hot Water Upgrade NSW | How to Claim Your Rebate

Many NSW households have heard about the "$33 hot water upgrade," but the truth is, this specific offer is unfortunately no longer available. However, there are still significant financial incentives provided by the NSW Government which reduce the costs of upgrading to energy-efficient hot water systems. Programs like Small-scale Technology Certificates (STCs) and Energy Savings Certificates (ESCs) can dramatically lower the expense of switching to environmentally friendly systems, potentially saving you hundreds of dollars.

In this article, we’ll break down these NSW Government incentives and explain how they make upgrading your hot water system more affordable. If you’d like to find out if you’re eligible and how much you can save, simply fill out the form below, and we’ll get in touch to assist with your new hot water system.

What is the $33 Hot Water Upgrade in NSW?

The $33 Hot Water Upgrade was a popular offer promoted by several companies in NSW, taking advantage of government incentives like Small-scale Technology Certificates (STCs) and Energy Savings Certificates (ESCs). These rebates were used to cover the majority of the cost of upgrading to energy-efficient hot water systems, including installation, while still leaving a margin for profit for the service providers.

To qualify for this upgrade, homeowners needed to have an existing electric hot water system that met eligibility criteria. If approved, they could upgrade to a more efficient heat pump system for just $33 in most cases. While this specific $33 offer is no longer available, NSW Government incentives like STCs and ESCs still apply, which can help significantly reduce your costs of upgrading to an energy-efficient hot water system.

Why is the $33 Hot Water Upgrade no longer available in NSW?

The main reason the "$33 Hot Water Upgrade" no longer exists is because the offer was never based on an explicit $33 rebate. Instead, it was made possible through two key incentives in NSW: Small-scale Technology Certificates (STCs) and Energy Savings Certificates (ESCs). These rebates significantly reduced the cost of upgrading hot water systems, and by law, the minimum amount that hot water companies could charge was $33. However, as time passed, several factors made it impossible for companies to continue offering the hot water upgrades at $33.

1. One major issue is that the number of STCs that could be claimed per heat pump decreases every year by around 3-4 certificates. At the time of writing, 1 STC is valued at $39.90, meaning each year, the rebates reduce by around $120-$160. This steady decline in the number of certificates has gradually reduced the financial incentives available.
2. The more significant factor, however, has been the steep drop in the value of ESCs. In October 2023, each ESC was valued at around $27, but in October 2024, that value has plummeted to $15 — a 45% decrease in just 12 months. 
3. Finally, since installers offering the $33 upgrade were working with very slim margins, the combination of fewer STCs and the sharp decline in ESC value made it financially unsustainable to continue offering hot water upgrades at just $33. As a result, the $33 hot water upgrade has been phased out.

So How Much Will it Cost to Upgrade?

Now that you are aware that it is impossible to upgrade your hot water system for $33, you are probably wondering how much it will cost. There is no definitive answer, because the cost will depend on several key factors:

1. Your Location: The effectiveness of energy-saving systems, such as heat pumps, varies by climate zone. If you live in an area where a heat pump hot water system can generate significant energy savings, your rebate will be higher. Warmer climates tend to benefit more from heat pump systems, while colder regions may see lower rebates due to reduced efficiency.
2. The Efficiency of the System You’re Installing: Rebates are designed to reward households for installing highly energy-efficient systems. If you're upgrading to a highly efficient heat pump or solar hot water system, you can expect a larger rebate. Less efficient systems receive smaller rebates, as the energy savings are not as substantial.
3. The System You're Replacing: If you’re replacing an outdated, inefficient system like an electric or gas water heater, you are more likely to qualify for higher rebates. However, if the system you’re upgrading is already efficient, your rebate may be smaller, as the potential for energy savings is lower.
4. The Cost of the System You Want to Install: The brand and model of hot water system you choose will vary in price, which will determine how much you need to pay. 

Keep reading to find out how to calculate your ESCs and STCs, and therefore estimate how much your discount will be when upgrading your hot water system.

Alternatively, to get a quote for your specific situation, or to discuss the available options, contact EE Hot Water via the contact form below, and an expert hot water specialist will give you a call.

NSW Hot Water Upgrade Incentives Explained

As mentioned above, the NSW Government has two schemes that help homeowners access discounted energy-efficient hot water systems. These are:

Energy Savings Certificates (ESC):

• NSW's Energy Savings Scheme (ESS) offers Energy Savings Certificates (ESCs) to reward households for installing energy-efficient appliances, including hot water systems. These certificates are generated when an accredited provider installs eligible systems, and the financial savings from ESCs are typically applied directly as a discount on the purchase and installation costs.
• ESCs aim to reduce energy consumption across the state and lower household energy bills.

Small-scale Technology Certificates (STCs):

• STCs are part of the federal government's Renewable Energy Target, designed to encourage the installation of energy-efficient systems like solar hot water and heat pumps. Homeowners can earn STCs based on the type of system they install and their location, which can then be traded to reduce the system’s upfront cost.
• The number of STCs available depends on the energy efficiency and type of system, as well as the installation location.

The total discount you receive will depend on the system you choose to install and your personal circumstances. When you combine ESCs and STCs you can save a significant amount of money when upgrading your hot water.

How Do I Calculate How Many ESCs I Will Earn?

You can use the calculators from the NSW Government to estimate the number of ESCs you will earn for upgrading your system. You can choose whether you are upgrading from an electric water heater or a gas water heater, and if you are replacing it with a heat pump or solar water heater.

Enter your postcode, and the brand and model of heat pump or solar water heater you plan to upgrade to, and it will calculate your ESCs.

In this example, we have calculated the ESCs using one of the most popular heat pump models, Ecogenica EG-260FR (read review here), upgrading from an electric hot water heater, and the results are displayed here:

You will receive 28 ESCs from upgrading from an electric hot water heater to the Ecogenica 260FR. At the time of writing, the market price of one ESC is $15, which means the savings you receive are $420. To see the current market price of an ESC, visit this website.

If we use another calculator to estimate the ESCs to upgrade from a gas water heater to the Ecogenica 260FR, you can see that the benefit is much lower, at only 13 ESCs, which equates to $195.

I also used the calculator to estimate the ESCs to upgrade from an electric hot water system to a solar water heater (Rinnai Close Coupled CCSE2002B) and the result is 37 ESCs, or $555.

If you upgrade from a gas hot water system to a solar water heater (Rinnai Close Coupled CCSE2002B) the benefit is much lower, at only 19 ESCs, or $285.

How Do I Calculate How Many STCs I Will Earn?

When calculating STCs, the great news is that you will be able to claim them regardless of which hot water system you currently have. The STCs are dependant on the efficiency of the new system that you will be upgrading to, as well as the location.

You can use this STC calculator to estimate the number of STCs you will earn. Simply enter the model of heat pump or solar water heater that you wish to install, your date of installation and the postcode, then click the 'Calculate' button.

In our example, I calculated the STCs for the Ecogenica EG-260FR, and the result was 22 STCs. At the time of writing, the market rate for 1 STC is $39.90, which means you will receive $877.80 for installing this heat pump. To see the current market price of an STC, visit this website.

I also calculated the STCs for the Rinnai CCSE2002B solar hot water system, and the result was 24 STCs, which equals $957.60.

Remember you can take advantage of both ESCs and STCs to maximise your discount. For example, if you make the switch from an electric hot water system to a heat pump system, you can save around $1,300, and if you are upgrading from an electric system to solar water heater, you could save around $1,500. This amount could be higher, depending on your location and which model you choose to upgrade to.

Who is Eligible for Hot Water Upgrade Rebates in NSW?

Households in NSW may be eligible for hot water upgrade rebates under the Small-scale Technology Certificates (STC) and Energy Savings Certificates (ESC) schemes, but several factors determine eligibility. These factors include your location within NSW, the type of water heating system you are replacing, and the energy efficiency gains that the new system will offer. Additionally, whether your area is serviced by an accredited provider also plays a crucial role in your eligibility.

To qualify for these rebates, your home must be located in NSW, and the existing water heater you are upgrading should demonstrate significant potential for energy savings. For instance, upgrading from an outdated electric or gas water heater to a more energy-efficient solar or heat pump system will likely make you eligible for the rebates. However, if you are replacing a system that already has high efficiency, such as an advanced solar water heater, you may not qualify, as the energy savings would not be substantial enough to meet the requirements.

Another key condition is that the upgrade must be completed by an accredited provider under the STC and ESC schemes. Only providers approved by the NSW Government are authorised to apply the rebates to your installation. Therefore, it’s essential to ensure that your location is within the service area of an accredited supplier. Before moving forward with an upgrade, it's wise to contact EE Hot Water to confirm your eligibility and understand the exact savings you can expect.

Types of Hot Water Systems That Qualify for NSW Incentives

To qualify for the available NSW government rebates, you must select one of the following energy-efficient hot water systems:

• Solar Hot Water Systems: Solar hot water systems harness energy from the sun to heat your water, making them one of the most sustainable options. By relying on solar panels, these systems dramatically reduce energy consumption and greenhouse gas emissions. While the initial cost may be higher, the long-term savings on energy bills and environmental impact make it a wise choice.
• Heat Pump Hot Water Systems: Heat pumps extract heat from the surrounding air and transfer it to the water, making them another highly energy-efficient option. These systems work well in a variety of climates and offer significant savings on energy usage compared to traditional electric water heaters. They are also known for their durability and efficiency, making them a cost-effective solution over time.

Both solar and heat pump systems greatly reduce energy consumption compared to conventional electric water heaters. Although the upfront costs may be higher, the rebates available through the STC and ESC schemes, along with the long-term energy savings, make these systems an excellent investment for households looking to lower their energy bills and environmental impact.

How to Apply for a Discounted Hot Water Upgrade in NSW

If you're thinking about upgrading your hot water system and want to take advantage of the available incentives, the application process is simple:

1. Find an Accredited Provider: Start by finding an installer accredited under the Energy Savings Scheme, as only accredited providers can apply the ESC discounts to your upgrade. Accredited providers like EE Hot Water can ensure that your system qualifies for the available rebates. Be sure to confirm that your chosen provider is certified to apply both STC and ESC rebates.
2. Choose an Eligible System: After connecting with an accredited provider, work together to select a hot water system that qualifies for both STCs and ESCs. Your provider will guide you through the options—such as heat pumps or solar hot water systems—and help you calculate how much you can save based on the incentives and energy efficiency of your chosen system.
3. Installation Process: Once you’ve selected your new hot water system, your accredited provider will take care of the installation. The rebates from both STCs and ESCs will be applied upfront, meaning the savings will directly reduce your out-of-pocket costs, making the upgrade more affordable from the start.

Benefits of Upgrading to an Energy-Efficient Hot Water System

Upgrading to an energy-efficient hot water system comes with several benefits beyond the financial incentives offered by government programs:

• Lower Energy Bills: One of the most significant advantages is the reduction in electricity usage. By switching to systems that rely on renewable energy, like solar, or heat pump technology, you can substantially lower your energy consumption. This translates into long-term savings on your utility bills, making the investment more cost-effective over time.
• Reduced Environmental Impact: Energy-efficient hot water systems contribute to a greener environment by cutting down on household energy consumption. These systems reduce reliance on fossil fuels, helping to lower your carbon footprint and support more sustainable living practices. For environmentally conscious homeowners, this is a great way to contribute to a cleaner, healthier planet.
• Extended System Lifespan: Modern energy-efficient systems are designed with longevity in mind. They often have longer lifespans compared to older models and require less maintenance, providing better value for your investment. By upgrading, you're not only reducing energy costs but also enjoying a more reliable and durable hot water system for years to come.

Upgrade Your Hot Water and Save Money

Although the $33 hot water upgrade is no longer available, the NSW Government’s STC and ESC incentives still offer a valuable opportunity to upgrade your hot water system at a reduced cost. These programs make energy-efficient systems more affordable, providing long-term savings on energy bills while reducing environmental impact. If you're thinking about upgrading, take advantage of these incentives and consult an accredited provider like EE Hot Water to find the ideal solution for your home.