The federal STC scheme does not pay for hot water in general. It pays for two product types: solar water heaters and air source heat pump water heaters. Everything else falls out of scope, which is why these three questions have mostly the same answer.
Gas boosted solar hot water
A solar water heater uses roof collectors to heat water, with a booster for cloudy days. The booster can be gas or electric. The registered product is the whole system, so a gas boosted model is eligible when its exact model is listed on the Clean Energy Regulator’s register of solar water heaters and installed by an eligible installer. The STC count comes from the register for your zone and install year, with a factor of 0.5 for 2026. See how many STCs a solar hot water system gets.
What does not qualify is a gas heater that is simply connected to solar panels or a retrofit that does not match a registered model.
Electric storage hot water
A standard electric storage system heats water with an element and holds it in a tank. It is not a solar water heater and not a heat pump, so it creates no federal STCs. Replacing one with an eligible heat pump or solar water heater does earn STCs, and the old unit’s removal is part of the evidence. See is a replacement heat pump eligible.
Instantaneous hot water
Instantaneous (continuous flow) gas and electric heaters heat water on demand without a tank. They are not eligible for federal STCs. Some state programs treat gas or electric appliance changes separately, so see your state’s scheme, for example Victorian heat pump certificates or NSW heat pump rebates.
Quick reference
| System | Federal STCs |
|---|---|
| Solar water heater, gas boosted | Yes, if the model is registered |
| Solar water heater, electric boosted | Yes, if the model is registered |
| Air source heat pump, under 425 L | Yes, if registered |
| Electric storage (element) | No |
| Gas storage | No |
| Instantaneous gas or electric | No |
At roughly $38 to $40 per STC at the time of writing, being eligible matters, but so does the year: counts fall each January to 2030.
Common mix-ups
- Brand ranges. A brand’s solar range and its standard electric range sit under different model codes.
- Hybrid systems. Check whether the unit is a heat pump with an electric boost or an electric unit with a marketing label.
- Retrofits. Adding collectors to an existing tank is a different question from a registered complete system.
What this means for you
Before you buy, check the exact model on the register: how to check hot water STC eligibility. Installers can find the claim steps in our hot water STCs page, the hot water checklist and pricing.