Today's rateSTC $38.50·VEEC $60.00Rate card

Hot water and heat pump STCs

Can you stack heat pump STCs and ESCs in NSW?

Short answer

Often, yes. A NSW heat pump can earn federal STCs and, where the activity qualifies, ESCs under the Energy Savings Scheme. Whether both apply depends on the product, the method and the current rules, so check each scheme before quoting.

Written and checked by the Energy Merchants desk · Reviewed 3 October 2026 · For installers and homeowners

NSW runs two schemes that can touch a hot water upgrade. One is federal and one is state. They are administered by different bodies and the certificates reach the customer as a discount rather than cash.

The federal layer

Eligible air source heat pumps create STCs based on the registered model, the climate zone and the installation type. Sydney, Newcastle and Wollongong are zone 3. At the time of writing STCs have been roughly $38 to $40. Federal rules require the usual evidence: signed assignment form, compliant installation and photos. See heat pump hot water STCs.

The NSW layer

The Energy Savings Scheme (ESCs) and the Peak Demand Reduction Scheme (PRCs) are run under NSW regulation, with IPART as the scheme administrator for ESS. An accredited provider creates ESCs when an approved activity is completed, and sells them to liable retailers. Whether a heat pump replacement qualifies depends on the activity method, the equipment and the property. ESC prices move with the market. See what an ESC is and ESC price. The NSW heat pump context is in NSW heat pump rebate and ESCs and the NSW heat pump guide.

How stacking works on a quote

The installer shows the gross price, the STC discount and, where it applies, an ESC discount as separate lines. Behind the scenes there are two claim processes, two sets of records and potentially two certificate providers.

What can stop it

  1. The model is eligible under one scheme and not the other.
  2. The activity’s replacement or baseline conditions are not met.
  3. The installer is not, or does not work with, an accredited provider for ESCs.
  4. Required records are missing for one scheme.
  5. The ESC method has changed since the quote.

From the desk: do not state an ESC dollar figure on a quote unless your accredited provider has confirmed it in writing. Values depend on the method and the market, and we do not quote NSW incentive amounts here for that reason.

What this means for installers

Decide who is the accredited provider, who holds the customer consent and who bears the risk if a certificate is refused. Use one organised document set for both. A trader that buys both certificates simplifies settlement. See our ESC trading page, pricing, how it works, VEECs and STCs on the same job for the Victorian parallel, and the hot water STC pillar.

Records for two schemes

Keep the ESC provider’s documents next to the STC pack: customer consent, product details, photos and the replacement evidence. If a question comes from IPART or the Clean Energy Regulator, you want to answer from one folder. Agree in writing with the accredited provider who holds which record and for how long.

Where a customer asks which scheme pays what, give them the mechanism and refer them to IPART for the current rules.

Follow-up questions

People also ask

Who creates the ESCs?
An accredited certificate provider under the NSW Energy Savings Scheme, not the Clean Energy Regulator.
Is the PDRS relevant to heat pumps?
The Peak Demand Reduction Scheme creates PRCs for certain activities. Check the scheme's activity list for hot water.
What are PRCs worth?
Reported at about $3 in 2026. Check the live market, as it moves.

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