Hot water rebates and running costs in Tasmania
The cleanest grid in the country and the hardest climate for a heat pump.
What a hot water system costs to run in Tasmania, what you can claim towards replacing it, and the local facts that change the answer here — the tariff structure, the climate and the grid.
What you can claim in Tasmania
Federal Small-scale Technology Certificates
$800–$1,200 off an eligible heat pump or solar thermal system
Available in every state. The installer claims the certificates and discounts your quote, so there is nothing for you to lodge. Tasmania sits in STC Zone 4, the lowest-value zone. Gas and electric resistance systems create no certificates.
Administered by the Clean Energy Regulator. Official scheme page. Last verified 5 September 2026.
Federal certificates only — on the cleanest grid in the country
Tasmania runs no state rebate for replacing a hot water system. The federal Small-scale Technology Certificate discount applies, worth roughly $800 to $1,200 off an eligible heat pump or solar thermal system.
Two Tasmanian facts change what that discount is worth. Reticulated gas reaches about 1% of Tasmanian homes, so for almost everyone the comparison is not gas against electric but one electric system against another — and there, a heat pump beats a resistance tank everywhere. And at 0.20 kg of CO₂ a kilowatt hour, Tasmanian electricity is already close to emissions-free, so the case here is about the bill rather than about carbon.
Why Tasmania is different
Tasmania's electricity is almost entirely hydro and wind, and its grid emissions factor of 0.20 kg CO₂-equivalent per kilowatt hour is the lowest in Australia — about a quarter of Victoria's. Anything you heat with electricity in Tasmania is close to emissions-free already, which removes the emissions argument from the decision and leaves it a straightforward question of money.
On money, Tasmania is also the hardest climate in the country for a heat pump. A heat pump extracts warmth from outside air, and Hobart has the least of it: the effective annual coefficient of performance here is about 2.14, the lowest of any capital, and the cold water entering the house averages 13.1 °C against Darwin's 27.6. A Tasmanian household needs roughly 40% more energy to heat the same volume of water as a Darwin one.
A heat pump is still comfortably the cheapest option in Tasmania, because the alternative is an element. Aurora Energy's Tariff 41 provides a controlled load rate of 21.1c for heating and hot water against the 28.0c standard Tariff 31, which narrows the gap but does not close it.
Reticulated natural gas reaches roughly 1% of Tasmanian homes, so any gas figure on this page should be read as indicative only. For practical purposes the choice in Tasmania is between a heat pump, an electric tank and solar thermal. There is no Tasmanian state rebate; federal certificates apply, and Tasmania sits in the lowest of the four STC zones, so the certificate value here is at the bottom of the national range.
Every system at Tasmania prices
A three-person household using 120 litres of hot water a day, at Tasmania's reference rates and the Hobart climate. On these assumptions the cheapest system to run in Tasmania is heat pump at about $414 a year.
| System | Cost per year | Rebates | 10-year total | CO₂e a year |
|---|---|---|---|---|
| Heat pump | $414 | −$800 | $7,985 | 260 kg |
| Solar thermal with electric boost | $561 | −$800 | $11,313 | 358 kg |
| LPG instantaneous | $778 | — | $10,131 | 612 kg |
| Electric storage | $859 | — | $10,486 | 613 kg |
| LPG storage | $1,108 | — | $13,476 | 873 kg |
| Solar thermal with gas boost | Reticulated natural gas reaches very few homes in Tasmania. | |||
| Gas instantaneous | Reticulated natural gas reaches very few homes in Tasmania. | |||
| Gas storage | Reticulated natural gas reaches very few homes in Tasmania. |
A three-person household in Tasmania using 120 litres of hot water a day, at 28.0c/kWh and 3.05c/MJ for gas, with the Hobart climate and the Tasmania grid's emissions factor of 0.2 kg CO₂e per kWh. Change any of it in the calculator.
Your own household will differ. Put your bill figures into the calculator and every number above recalculates.
The certificate value is falling every January
The federal scheme is winding down on a fixed schedule. Certificates are deemed over a period that shortens by one year every 1 January, and the scheme ends in 2030 — so the same system installed in Tasmania in December earns about a fifth more than it would a few weeks later.
| Install year | Deeming period | Indicative value |
|---|---|---|
| 2025 | 6 years | — |
| 2026 (now) | 5 years | $800–$1,200 |
| 2027 | 4 years | $640–$960 |
| 2028 | 3 years | $480–$720 |
| 2029 | 2 years | $320–$480 |
| 2030 | 1 years | $160–$240 |
The certificates a heat pump creates are deemed over a period that shortens by one year every 1 January until the scheme ends in 2030. Waiting from December to January costs about a fifth of the discount, for exactly the same system. It is the one piece of timing advice on this site that is worth acting on.
How Tasmania compares
The Northern Territory sits at the opposite climate extreme — among the best conditions for a heat pump in the country, against Tasmania's among the hardest. Victoria's stacked rebates are worth knowing about too, even though Tasmania cannot claim them: three separate programs deep, against Tasmania's federal certificates alone.
Frequently asked questions
What's actually the cheapest system to run in Hobart?
A heat pump, at about $414 a year for a three-person household on 120 litres a day — the one state on this site where a heat pump, not solar thermal with gas, takes the top spot, because reticulated gas barely reaches Tasmanian homes.
Is there a Tasmanian rebate for hot water systems?
Only the federal one — $800 to $1,200 off an eligible heat pump or solar thermal system, since Tasmania runs no state top-up. The final figure depends on system capacity and the certificate price on the day of an accredited quote.
What does Tasmanian electricity cost for hot water?
28.0c per kilowatt hour with a $1.68 daily supply charge, under Aurora Energy's OTTER-approved 2026–27 standing offer (approved 25 June 2026). A controlled-load circuit brings that to 21.1c. Retailer market offers frequently beat this reference rate.
Does a heat pump struggle in Hobart's cold?
It is at the lower end nationally — an effective coefficient of performance around 2.14 against a 3.2 nameplate, since there is less heat in the air to extract through a long Tasmanian winter. It still comes in under half the running cost of a resistance element, and on a grid this clean the emissions case is already settled.