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Alastair McDowell
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New commercial and industrial (C&I) air source heat pump water heater (HPWH) activities have just been introduced to the Victorian Energy Upgrades (VEU) and NSW Energy Saving Scheme (ESS). EnergyAE worked with VIC and NSW government to develop these new schemes are we are now very excited to assist you to apply your products for the program.

These activities reward installation of new HPWH systems, either for replacing a gas or electric water heater/boiler, or for the installation of a new system.

Expected certificate returns can be up to 80-90% of equipment cost for replacing an electric system, and around 20-30% of equipment cost for replacing a gas system.

This article describes how to apply for the incentive schemes, eligibility criteria, documentation requirements (test reports, schematics, specifications), addresses frequently asked questions, and how EnergyAE can help you get your systems registered to the scheme.


EnergyAE can help you to register your HPWH systems to the VEU and ESS activities. We take care of all TRNSYS modelling, documentation and submission to the ESC Registry.

  1. Get in touch with EnergyAE to discuss the range of products you would like to register
  2. Provide EnergyAE with your product documentation (see below for Documentation requirements)
  3. EnergyAE models your system using C&I load profile and methodology
  4. EnergyAE submits your application to VEU Registry, administered by Essential Services Commission (ESC)
  5. Your application will be assessed by ESC for approval
  6. Install your product at an eligible location (see Eligibility requirements below)
  7. Claim VEECs/ESCs via an AP or ACP

If you would like EnergyAE assistance to register your products, or would like more information, contact us here.


There are a few differences between the Residential and new C&I activities. All systems must be re-modelled in TRNSYS using the updated C&I methodology:

  • New load profiles have been developed to represent typical C&I applications.
  • Variable load sizing, instead of fixed load sizing (small, medium, large etc)
  • Tank heat loss can be calculated for tanks larger than 700L
  • More flexible options for heat pump performance testing

Residential HPWHs can be registered for the C&I activities, but Bs/Be values are not valid. Residential systems must be re-modelled according to the C&I method to determine the equivalent C&I figures.


The following additional resources provide more information on the VEU and ESS programs:

This is a summary of the eligibility rules for the C&I VEU and ESS schemes:

Product Eligibility:

  • One or more air source HPWH
  • Must be modelled using the appropriate C&I TRNSYS templates, weather and load profiles developed for this scheme
  • Minimum delivery temperature of 45 degrees Celsius for all climate zones
  • Minimum annual energy savings of 60%
  • If total storage volume less than 700L, must be certified to AS/NZS 2712

Product Registration:

Installation Eligibility:

  • Business or non-residential premises
  • VEU: Common areas of a building that is classified under Part A6 of Volume One of the Building Code as a Class 2 building
  • ESS: must not be installed in a BCA Class 1 or 4 building
  • Installed by a licensed or registered plumber.


  • Existing equipment must be either gas or electric resistance hot water, not necessarily working at time of replacement
  • The existing water heater must be removed.
  • See activity guides for detailed decommissioning requirements.

Claims Process:

Q: Do I have to model a separate system for every multiple of a residential unit?

A: No, only a single unit needs to be modelled, and any multiple of this exact unit will have the annual energy consumption multiplied by the number of units installed.

Q: Can I submit a residential product to both the residential and C&I schemes?

A: Yes, the unit is modelled with different load profiles. See the differences in installation eligibility for residential vs C&I in the table above

Q: Please clarify the rules for installation of a new HPWH with greater capacity than the existing system capacity?

A: If the new heat pump thermal capacity (kW) > existing system thermal capacity (kW), then the VEECs are multiplied by the Capacity factor where: Capacity Factor =(Existing system thermal capacity (kW))/(Heat pump thermal capacity (kW)). For example, if existing capacity = 10kW, new HPWH capacity = 20kW, Capacity Factor = 10/20 = 0.5.

Q: If I have already got a residential system registered, what additional information do I need to provide?

A: None extra


The following documentation might  details the documentation EnergyAE requires to prepare an application and undertake TRNSYS modelling:

System Schematic
  • Tank model, number of tanks
  • Heat pump model, number of heat pumps

For stand-alone systems:

  • Pipework dimensions
  • Pump Model(s) and positions in system

If applicable:

  • Heat Exchanger(s) and position in system
  • Boost Tank Model, Number of tanks (if applicable)
  • Booster Model (e.g. CFGWH), Number of Boosters
  • Boost plant pipework dimensions
Heat pump performance
  • AS/NZS 5125.1 or;
  • EN 14511 Performance Report.
Storage Tank(s)
  • AS/NZS 4692.1 test report, or;
  • 700L+ calculation report (see AS/NZS 4234:2021 Appendix E)
  • Tank drawings: showing height /volume above all fittings, elements and sensors.
Auxiliary Heating
  • Electric booster capacity (kW)and thermostat settings (Set point and dead-band, e.g. 60°C and 8°C)
  • Gas booster performance: AS 4552 test report
  • Heat exchanger specifications (UA for specified flow rates and delta T)
  • Control logic specifications or flow charts
  • Flow rate specifications, and demonstration of flow rate control, such a via a flow meter, or flow rate controller. This may be demonstrated by the installation manual
  • Pump test report or hydraulic analysis: determining of pump flow rate and power consumption specific to collector array size or boost plant
  • Pipework insulation specifications: thickness and thermal conductivity. This can be specified by the installation manual.



This section lays out the standards referenced by this incentive program.

AS 2712 – Design & Construction of Solar & Heat Pump Water Heaters

Products with a total storage volume less than 700L must be certified to AS 2712 through an accredited certification body. Bodies are accredited by the Joint Accreditation System of Australia and New Zealand (JAS-ANZ). JAS-ANZ accredited bodies will provide certification to AS 2712, WaterMark and GasMark, as applicable.

This standard specifies design and construction requirements for solar and heat pump water heaters. Your certifier should specify the specific tests required for a product.

AS/NZS 4234 – Annual Energy Performance Calculation Method

This standard specifies the calculation methodology for evaluating the annual energy consumption for heated water systems including SWHs and HPWHs using TRNSYS software.

In June 2021, an update to this standard was released: AS/NZS 4234:2021. VEU/ESS C&I modelling calls on AS/NZS4234:2021. The prior version was released 2008.

Heat Pump Performance: AS/NZS 5125.1 or EN 14511

Residential HPWH have their performance assessed by AS/NZS 5125.1 This standard specifies the performance assessment for air source heat pump water heaters and is used to determine the power and COP of an HPWH, which are used to form correlation equations for HPWH performance over a range of conditions.

An alternative test standard is EN 14511which allows the performance a HPWH to be assessed over a grid of test points for varying entering water (inlet) temperatures and ambient air temperatures. The power input and thermal capacity is measured at each point, forming a 2D table(performance map) of values.

Tank Heat Loss: AS/NZS 4692.1 or AS/NZS 4234 Appendix E

Testing to AS/NZS 4692.1 is required for systems including water storage tanks up to 700L in volume. This standard specifies energy consumption, performance and general requirements for electric water heaters and is used to determine the tank heat loss value for a thermal storage tank.

For tanks with volume greater than 700L,AS/NZS 4234:2021 Appendix E provides a calculation methodology.

AS 4552 – Gas Fired Water Heaters

Testing to AS 4552 is required for systems including gas boosters. This standard specifies requirements for gas fired water heaters for hot water supply and provides the thermal performance for the gas booster.


EnergyAE specialises in helping manufacturers to register their product for VEU and ESS activities. We provide the following related services:

  • Eligibility check
  • TRNSYS modelling
  • Preparation of application documents
  • Application via the VEU Registry
  • Training in TRNSYS modelling

Get in touch with us today to discuss an upcoming project.


EnergyAE is an Australia & NZ engineering consultancy providing engineering & energy analysis services in the solar and heat pump water heater industry. EnergyAE has extensive experience assisting manufacturers to apply for government incentive programs to be eligible for STCs and VEECs. EnergyAE has helped VIC and NSW government to develop these new Commercial & Industrial HPWH activities.

Got a project in mind?

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