Heat pump hot water system attached to the wall of a house.

Top 5 Benefits of a Heat Pump Hot Water System

When it comes to water heating solutions for the home, most of us will think of gas, electric or solar powered systems. The heat pump hot water system offers a compelling range of benefits that are well worth your consideration.

No doubt you’d have heard of gas, solar and the electric hot water system, but what about the heat pump hot water heater? Perhaps less common than the other hot water systems, heat pump systems actually provide a compelling range of benefits over their more familiar counterparts.

From superior energy efficiency to longer lifespan and high level versatility, there are numerous reasons as to why the heat pump might be the right hot water system for you. Let’s dive head first into the world of heat pump technology and explore further how it can help you save money and the planet all at once.

But First … How Do Heat Pump Water Heaters Work?

Before we look at the many benefits of the heat pump water heating, it’s worth looking first at how the system works.

Heat pump water heaters consist of a hot water storage tank, a compressor and a heat exchanger. There are two different types available. The most common are air source heat pumps, which draw heat from the ambient air. There are also ground source heat pumps, which extract heat that has come from a range of sources (instead of the air) including:

  • A body of water
  • Shallow trench
  • Deep bore

Unlike gas, electric and solar water heater systems, heat pumps don’t actually create heat energy. Instead, they draw in the surrounding air and then pass that ambient air across a heat exchanger. That heat moves through to a refrigerant fluid, where it is compressed and in doing so increases its temperature.

The heated refrigerant fluid then moves through to a heat exchanger. At this point, it transfers the heat to the water stored in the tank. The system repeats the process over and over until the stored water achieves its set temperature.

Heat Pump Water Heater Benefits

To be upfront, the heat pump water heater can be considerably more expensive to purchase and install than other hot water systems. However, it also offers considerable advantages that make it a worthwhile option for many Australian homes. Let’s take a look at some of them.

1. Heat Pumps are Energy Efficient 

Heat pump hot water systems are incredibly efficient when it comes to energy use. Unlike traditional hot water units that use combustion to produce heat, heat pump systems heat water using heat energy extracted from the ambient air or the ground. It’s a process that consumes far less energy, which therefore makes for a more efficient water heating solution.

Though heat pump systems do use electricity to operate the heat pump, it generally uses between 60% and 75% less electricity than a traditional electric hot water heater. This is because it doesn’t directly heat the water with an element, and only uses electrical energy to run the pump.

2. Heat Pump Water Heaters are Cost-Effective

Following on from the benefit of energy efficiency, a heat pump hot water system will offer excellent cost-effectiveness as well. The reduced electricity use with heat pumps effectively translates to savings on your quarterly energy bill. Heat pump hot water systems may ultimately be more expensive to purchase, but the savings on running costs you enjoy can potentially offset that additional initial cost over the system’s lifespan.

Speaking of which, the overall longevity of a heat pump hot water system means that they require less-frequent replacement, thereby further saving you money. More on longevity later though.

And on top of each of these, you may be eligible for extra financial incentives by adopting this particular form of water heating technology. For example, Victorian homeowners may be entitled to a partial payment towards the cost of a heat pump system installation. Check with your state government to determine what possible rebates and incentives you might be entitled to.

3. Heat Pump Hot Water Systems are Eco-Friendly

It should perhaps come as no surprise that, with their high energy efficiency, heat pump water heaters are among the most environmentally friendly systems. They offer greater sustainability simply because they use renewable sources of energy rather than rely on fossil fuels to produce heat. Additionally, they generate fewer greenhouse gas emissions, and effectively help you to minimise your carbon footprint.

Opting for a heat pump hot water system means that homeowners are more equipped to exercise more control over their general impact on the environment. This is particularly important in the need to reduce the effects of climate change and help protect the planet for future generations.

4. A Heat Pump Water Heater Offers Longevity

We mentioned it before, but it’s worth repeating – heat pump hot water systems offer excellent longevity. They boast a lifespan that is typically longer than many traditional electric or gas heaters, and therefore need replacing less frequently.

There are many variables that will determine the lifespan of your heat pump water heater; factors such as:

  • the amount of usage it receives
  • the amount of maintenance it receives, and
  • the overall quality of the system

By sticking to a strict maintenance schedule, one that really gives your system a thorough servicing, you can potentially get a good 20 years or more out of your system. By comparison, many traditional hot water systems will provide between 10 and 15 years of service.

5. Heat Pump Systems are Versatile

Finally, hot water heat pump units offer a versatile range of options. There are many choices you can make. Among them are:

  • Whether you opt for an integrated system, with a combined tank and compressor in a single unit, or a split system where the tank is a separate unit to the compressor.
  • The right environment for installation – whether indoors or outdoors – depending on possible space restrictions.
  • System sizes and configurations.
  • Whether you integrate them with other renewable sources, such as solar systems, to save energy on a larger scale.

The versatility of heat pump systems enables them to be just as effective in everything from homes to apartment blocks to commercial buildings. It’s a smart choice.


A heat pump hot water unit delivers benefits in spades to Australian homeowners, where warmer climates are part and parcel of our lifestyle. Sure, they may be a more expensive option to purchase and install than other more familiar hot water solutions. However, with benefits such as high energy efficiency, cost-effectiveness, eco-friendliness, long lifespan and versatility, the pros far outweigh the cons.

If you’re looking for a system that draws its hot water energy from the air temperature rather than from gas or electricity, now’s the time to look at a heat pump hot water heater.

Please note: This information is provided for advice purposes only. Regulations differ from state to state, so please consult your local authorities or an industry professional before proceeding with any work. See our Terms & Conditions here.

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