Heat pump or gas hot water in Pakenham?
The honest arithmetic, including the one number that decides most of these jobs and that nobody puts in the brochure: the daily gas supply charge. Plus what a Pakenham winter really does to a heat pump, and the noise problem on a 400-square-metre estate block.
The arithmetic, with the supply charge in it.
Start with the energy, because everything else follows from it. A four-person Pakenham household gets through roughly 200 litres of hot water a day, which across a year is about 3,800 kWh of actual heat delivered. Every system below has to produce that same 3,800 kWh. The only question is what it costs to make.
- Electric resistive storage. One unit of electricity in, one unit of heat out. 3,800 kWh at a flat 25c is roughly $950 a year, or nearer $700 if it is all on a controlled off-peak circuit. Cheapest to install at $1,500 to $2,600, dearest to run, and a decision you live with for a decade.
- Gas continuous flow. About 16,000 MJ a year to deliver the same heat. At Victorian 2026 rates that is roughly $600 to $700 in gas - plus the daily supply charge.
- Heat pump. Moves heat rather than making it, at a seasonal COP of about 3 in our climate. So roughly 1,200 kWh of electricity for the same 3,800 kWh of heat. Run on a daytime timer into your own solar, call it $120 to $250 a year.
Now the number that decides it. A Victorian gas daily supply charge is around $0.80 to $1.00 a day - $300 to $350 a year just to keep the connection live, before you burn anything. If hot water is the last thing you have on gas, that charge is entirely attributable to it, and the comparison becomes roughly $950 a year for gas against roughly $150 for a heat pump. If you still have a gas cooktop and gas ducted heating, the charge is shared, gas hot water costs you the $600 to $700 of gas alone, and the heat pump still wins by about $500 a year. Tariffs move and households differ, so these are bands, not promises - but the direction does not change.
Why this changed recently, and why it favours the heat pump.
Ten years ago exporting solar paid well, and a heat pump running at midday was competing against a decent feed-in tariff. That is over. Victorian feed-in rates have collapsed to a few cents, and the mandatory minimum has been wound back, so the electricity your roof makes at 1pm is worth almost nothing to you if it leaves the property.
That completely inverts the sum. A heat pump on a midday timer is a way of converting near-worthless exported electricity into a tank of hot water you will use tonight - effectively a thermal battery you already own. That is the single biggest reason we are fitting so many of them across Officer, Cardinia Lakes and Lakeside, where nearly every roof has panels on it. If you have solar and you are still exporting at midday while paying a gas supply charge to heat water, the numbers are actively arguing with you.
No solar changes the picture but does not reverse it. A heat pump on a plain flat tariff still needs only about a third of the electricity of a resistive unit and still beats gas once the supply charge is counted. It just pays back slower.
What the brochure leaves out.
Winter performance is real. A heat pump pulls heat out of outside air, so its COP falls as the air cools. Our overnight minimums of 4 to 6 degrees knock it back without breaking it - this is not Ballarat. Most units carry an electric booster for the worst mornings and a properly sized 250 to 280 litre tank rides through. But up in Pakenham Upper, Beaconsfield Upper and Gembrook where frost is annual, buy a unit with a genuine cold-climate rating, not the cheapest box on the pallet. Our winter checklist covers the rest of the seasonal picture.
Noise, on blocks this size. Nobody raises this until after the install. A heat pump has a compressor and a fan, roughly 37 to 50 dB. On a 400-square-metre estate block with a 1.5 metre side setback, that puts it about two metres from a neighbour's bedroom window. It is entirely manageable, but it has to be planned: pick a wall away from bedrooms on both sides, use proper anti-vibration mounts, respect the manufacturer's airflow clearances (you cannot box it in to hide it), and run it on a daytime timer. The timer fixes the noise and captures the solar in one move.
Recovery is slower. A heat pump takes hours, not minutes, to reheat a tank. Run it dry with three teenagers on a Sunday night and you wait. Gas continuous flow never runs out - that is its genuine, permanent advantage, and for a big household with unpredictable demand it counts for something.
An Officer house with a 5kW system on the roof.
Four people, 2016 Officer build, 5kW of solar, original gas continuous flow unit, gas cooktop already swapped to induction and the ducted gas heater replaced with a reverse cycle system two years ago. So hot water is the last gas appliance in the house. Right now she pays roughly $650 a year in gas plus $330 in supply charge: about $980.
Fit a 280-litre heat pump on the north-east wall away from both bedroom windows, on a midday timer. Installed cost roughly $4,200, and after the rebates available to most Victorian households the net is commonly in the $1,500 to $3,000 range - we go through what applies and how to stack it on our hot water rebates guide. Running cost on the timer, soaking her own solar for most of the load: call it $150 a year. Then disconnect the gas service entirely and the $330 supply charge goes with it.
So roughly $980 a year becomes roughly $150. An $830 annual saving against a net install somewhere around $2,000 pays back in about two and a half years, and the unit has a 10 to 15 year life. That is a genuinely good job. Note how much of it came from the supply charge rather than the appliance - which is exactly why we ask what else is on your gas before quoting a hot water changeover.
The thing that may decide it for you anyway.
Victoria has legislated an end to like-for-like gas hot water replacement in existing homes from 1 March 2027 - when a gas hot water system reaches end of life after that date, it gets replaced with an efficient electric system. New homes requiring a planning permit have already been all-electric since the start of 2024. This is material if you are standing in front of an eleven-year-old gas unit deciding what to do, because a gas unit fitted now may well be the last one that house ever has.
Two honest caveats. This area of policy has moved more than once, so confirm the current position before you commit money to either path - do not take a website's word for it, including ours. And a compliant gas unit already installed is not going anywhere; nobody is coming to remove working appliances. It is about what happens the day the current one dies, which for most of the housing stock around here is not far off - see our lifespan guide for where your unit sits.
Common questions.
Is a heat pump cheaper to run than gas in Pakenham?
Comfortably, on our arithmetic. A four-person household needs about 3,800 kWh of heat a year. Gas continuous flow burns roughly 16,000 MJ for that, about $600 to $700 at 2026 Victorian rates. A heat pump at COP 3 needs about 1,200 kWh, roughly $120 to $250 on a daytime solar timer. Tariffs vary, so treat those as bands.
Does the gas supply charge really matter that much?
It is the whole argument if hot water is your last gas appliance - $0.80 to $1.00 a day is $300 to $350 a year just to have the connection live. Take hot water off gas, disconnect the service, and it goes. If you still run a gas cooktop and heating, the charge is shared and the heat pump wins by about $500 a year instead of $800.
Do heat pumps work in Pakenham winters?
Yes, but less well in July than January - COP falls as air temperature drops. Minimums of 4 to 6 degrees knock it back without breaking it; this is not Ballarat. Most units have an electric booster and a 250 to 280 litre tank rides through. In Pakenham Upper, Beaconsfield Upper and Gembrook, buy a proper cold-climate rated unit.
Are they noisy on an estate block?
Roughly 37 to 50 dB, and on a 400sqm block with a 1.5m setback that is two metres from a neighbour's bedroom window. Manageable with planning: a wall away from bedrooms both sides, anti-vibration mounts, the manufacturer's airflow clearances (no boxing it in), and a daytime timer that fixes noise and soaks solar at once.
Is there any case left for gas?
A narrowing one. Shared supply charge with a cooktop and ducted heating, no solar, and nowhere sensible for a heat pump in the setback - then a 6-star continuous flow at $2,200 to $3,500 is defensible for one more cycle. It never runs out and it is silent. But note the 1 March 2027 rule, and confirm its current status before committing.
Service areas.
Want the sum run on your actual house?
We will look at what else is on your gas, where a unit can go, and what the rebates net it down to. No pressure either way.