The Federal Government has detailed how the adoption of renewable energy is increasing across Australia, with several initiatives playing a key role.
This includes the $1 billion Household Energy Upgrades Fund, which delivered 6000 clean energy upgrades to Australian households in 2025, including the installation of hot water heat pumps alongside other technologies such as rooftop solar and batteries.
Administered by the Clean Energy Finance Corporation (CEFC), this initiative is designed to accelerate homeowners’ adoption of green technologies through low-cost finance.
Brighte, Plenti, Commonwealth Bank, Westpac and ING have developed loans to support homeowners on their clean energy journey, with the installation of hot water heat pumps a core part of their offerings.
Hot water heat pumps are increasingly being chosen in place of gas and electric resistive hot water services in households, while air-to-air heat pumps are preferred over gas-ducted heaters.
In commercial applications, gas boilers are being replaced by larger multi-function chiller heat pumps that drive higher energy efficiency and provide both heating and cooling.
In May 2025, the Australian Manufacturing Technology Institute Limited (AMTIL) observed the current industrial heat pump landscape in Australia, suggesting local industry should take cues from New Zealand’s growing adoption of industrial heat pumps (IHPs).
In doing so, AMTIL enlisted the expertise of IEEFA Australia chief executive officer Amandine Denis-Ryan.
“Adoption remains slow in Australia, with only a few IHPs deployed here,” she said. “In contrast, New Zealand is already well ahead of its larger neighbour.
“New Zealand’s Energy Efficiency & Conservation Authority (EECA) estimates that about a quarter of their country’s potential for IHPs has now been captured. The shift appears to have contributed to a material decrease in coal and gas use in the country’s food and beverage sector.”
Denis-Ryan found coal and gas use had decreased 12 per cent and 21 per cent, respectively, in the food and beverage sector, with electricity use increasing 7 per cent.
New Zealand industry has increased the adoption of IHPs since 2013 when the NZ Government introduced the Technology Demonstration Fund, which has provided 50 per cent co-funding of IHP projects using heat pump technologies of varying temperatures.
The Government Investment in Decarbonising Industry (GIDI) fund followed that, with the Energy Transition Accelerator following that.
“One of the key impacts of the various government programs was catalysing the development of an IHP industry in New Zealand,” Denis-Ryan said.
“Refrigeration companies are now the primary suppliers of IHPs, supported by specialised consultants. IHPs utilise the same technology as refrigeration systems, which makes refrigeration companies a natural fit.
“Australia can learn a lot from New Zealand and benefit from its capacity development. Given the imminent excess gas demand on Australia’s east coast, it’s time to start seriously considering those opportunities.”
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