Hot water systems

Why are we reviewing hot water systems?

Hot water makes up 23% of residential energy use in Australia and 28% in New Zealand.
There is no agreed or consistent way of comparing products across technologies or incorporating new developments in water heating.
Consumers do not have the appropriate information to make informed choices about the energy use of hot water systems and their impact on greenhouse gas emissions.
Minimum energy performance standards (MEPS) date back to 1999 for electric and gas storage water heaters and are overdue for review. Other water heaters are not subject to MEPS.

What outcome are we seeking?

A review of the hot water policy will offer a number of potential benefits and opportunities for change, including:

consistent regulation of all hot water systems available for purchase in the transTasman market irrespective of technology type
consistent, mandatory energy labelling which will allow consumers and installers greater access to information to make well informed purchasing decisions
changes to advice for consumers and purchasing behaviours to favour more energy efficient hot water products and will reduce household energy bills and reduce greenhouse gas emissions
greater alignment of the standards and regulations for hot water products across Australia and New Zealand with potential to use international standards and test methods

How is this work happening?

Government wants to work with the hot water industry to come up with practical and effective solutions.

The first phase of the project was the development of a policy framework and roadmap.

Hot water systems policy framework [PDF 1.1 MB]

Stakeholder engagement

Stakeholders were invited to comment on the discussion document and the proposed policy framework document in 2018. Twenty-four written submissions were received from a range of interested parties with diverse perspectives.

Phase 2 (the current phase) of the project will develop a relational database of current hot water systems available in Australia and New Zealand. This includes and an evaluation methodology suitable for assessing the energy efficiency of all hot water system technologies and fuel types. Water draw off profiles (tapping profiles) will be established across Australia and New Zealand. This will provide consumer hot water consumption data to enable comparability of technologies for different consumer profiles. These activities will address stakeholder feedback from Phase 1.

A discussion paper outlining the proposed method for evaluating the performance of hot water systems was released on 18 January 2021. Twenty six submissions were received. Feedback included broad acceptance of the proposed method.

Hot water CTM discussion paper [PDF 1.2 MB]

What systems are being reviewed?

Electric storage
Gas storage
Instantaneous gas
Heat pump technology
Instantaneous electric
Solar hot water with electric boost

How will consumers benefit?

New standards and better information on hot water systems can save households money and reduce greenhouse gas emissions.

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Regulatory requirements under review
Have your say about regulations being revised and developed.

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- Distribution transformers
  EECA and the Australian Department of Climate Change, Energy, the Environment and Water (DCCEEW) are consulting on policy options to improve the energy efficiency of distribution transformers in New Zealand and Australia.
- Electronic Displays: televisions, computer monitors, and digital signage displays
  EECA and the Australian Department of Climate Change, Energy, the Environment and Water (DCCEEW) have consulted on whether to update the MEPS and MEPL requirements for electronic displays.
- Australia's Greenhouse and Energy Minimum Standards (GEMS) due to expire
  EECA and the Department of Industry, Science, Energy and Resources (DISER) are consulting on 6 products energy efficiency regulations that are due to sunset (expire) in Australia in the next few years.
- Residential space heaters in Australia and New Zealand
  EECA and the Australian Department of Climate Change, Energy, the Environment and Water (DCCEEW) have consulted on a Space Heating Comparison Methodology
- Smart appliances
  During 2019, E3 investigated whether all new air conditioners and heat pumps, electric hot water cylinders, and electric vehicle chargers sold in New Zealand should be demand response capable.
- LED lighting
  On 28 April 2018, the Council of Australian Governments (COAG) Energy Council Ministers, alongside New Zealand Minister of Energy and Resources - Megan Woods, agreed to introduce minimum standards for LED lamps that align with European Union regulations.
- Air conditioners & heat pumps
  In May 2019, New Zealand Cabinet approved the E3 policy proposal to revise the MEPS and energy labeling requirements for air conditioners and heat pumps. A process to amend current regulations is underway.
- Chillers
  An E3 project to review the minimum energy performance standards (MEPS) for chillers has been initiated. A consultation Regulatory Impact Statement will be developed.
- Industrial equipment (pumps, boilers and compressors)
  The Equipment Energy Efficiency (E3) programme has primarily targeted household electrical equipment. The E3 Programme is in the initial stages of investigating potential regulations for industrial equipment.
- Fans (non-domestic)
  In April 2019, E3 agreed to put the non-domestic fans project on hold.
- Commercial refrigeration
  In May 2018, New Zealand Cabinet approved the E3 policy proposal to revise the minimum energy performance standards (MEPS) for commercial refrigeration. A process to amend current regulations is underway.
- Fridges & freezers (domestic)
  On 28 May 2018, New Zealand Cabinet approved the proposed updates to regulations for Household Refrigeration products.
- Hot water systems
  EECA is leading a joint project with Australia to improve the energy efficiency of water heating in residential households under the Equipment Energy Efficiency (E3) Programme.
- Electric motors (three-phase)
  New Zealand Cabinet has agreed to update the requirements in line with an international test standard for registration of electric motors, streamlining the registration process for industry. An issues paper is being developed.
- Commercial ice makers
  EECA and the Australian Department of Climate Change, Energy, the Environment and Water (DCCEEW) have consulted on whether to introduce Minimum Energy Performance Standards (MEPS) for commercial ice makers.