When people ask “solar hot water vs heat pump STCs” they usually want to know which discount is bigger. The honest answer is that it is a model-by-model question, but the two categories do differ in useful ways.
What is the same
Both sit under the Small-scale Renewable Energy Scheme and both are listed on the Clean Energy Regulator’s register of solar water heaters. In both cases the entitlement is built on a 10-year system life, then scaled by an install-year factor: 0.5 for 2026, 0.4 for 2027, 0.3 for 2028, 0.2 for 2029 and 0.1 for 2030, with the scheme ending on 31 December 2030. Both need an eligible installer, an approved model and an assignment form from the owner. At roughly $38 to $40 per STC at the time of writing, the dollar logic is the same.
What differs
| Solar water heater | Air source heat pump | |
|---|---|---|
| Postcode zones | 4 | 5 |
| Size limit | Under 700 litres without extra documentation | Under 425 litres |
| Energy source | Sun, with a booster | Outside air, electric compressor |
| Cold climates | Weaker on cloudy days, needs boost | Works, with lower efficiency |
| Roof use | Needs roof space for collectors | Needs outdoor space, no roof |
Which earns more?
Each registered model has its own figure per zone. A well-performing solar water heater in a sunny zone can register a higher count than an average heat pump, and a high-efficiency heat pump can beat a basic solar unit. The category does not decide it. See how many STCs a heat pump gets and how many STCs a solar hot water system gets.
Beyond the STC count
STCs are only part of the cost comparison. Think about:
- Running cost. A heat pump uses electricity at a fraction of an element’s draw. A solar water heater uses a booster, often gas or electric.
- Install cost and complexity. Collectors on the roof add plumbing and structural considerations.
- State incentives. Victorian VEECs and NSW certificates can apply differently. See heat pump VEECs in Victoria and solar hot water rebates in Victoria.
- Your solar panels. A heat pump can be timed to run on rooftop solar output, which is a strong argument if you already have PV.
What this means for you
Pick the system for your household first, then use the register to confirm the discount. The longer comparison is in heat pump vs solar hot water and heat pump hot water STCs explained. Installers can see how claims run on the hot water STCs page, and rates are on pricing.