Heating & Cooling
Gas vs electric: which heating system is more efficient?
How reverse cycle efficiency, tariffs and duct losses affect the comparison.
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Designed & installed by AEU
Licensed A-grade electricians · Victoria
Residential Heating & Cooling Solutions
Ditch the gas. Keep year-round comfort.
AEU designs and installs energy-efficient reverse-cycle air conditioning for Victorian homes, from one-room split systems to zoned whole-home ducted systems. We assess your existing equipment, heat load and eligible Victorian Energy Upgrades (VEU) discount before we quote, then apply the confirmed discount upfront. If you are comparing residential heating and cooling in Victoria, start with the system your home actually needs, not the largest rebate number on the market.
The Industry Standard We Set
30
Year
Workmanship Guarantee
Most HVAC installers offer a 5-year workmanship guarantee — if they’re still operating to honour it. AEU backs every residential installation for three full decades — split, multi-split and ducted reverse cycle systems.
Our Difference
65k+
Products installed
300k+
Tonnes CO₂ prevented
10k+
Customers & homeowners
100%
Australian owned & operated
What We Install
The right system for every home.
Single Room · Open Plan
CUSTOMER FAVORITE
Split System
Heat or cool a single room or open-plan space. Quick install, VEU rebate-eligible, and perfect for bedrooms, living areas or home offices.
Typical annual saving
$600–$1,200
VEU rebate available
Up to $3,000+
Get a free quote
Most popular
Multiple Rooms · One Outdoor Unit
Popular
Multi-Split System
One outdoor unit powers 2–5 indoor units. Control each room independently. Perfect for 3–4 bedroom homes — comfort without the cost of ducted.
Typical annual saving
$1,000–$1,800
VEU rebate available
Up to $10,290
Get a free quote →
Whole Home · Zone Control
Premium
Ducted Reverse Cycle
The gold standard for whole-home comfort. Zoned control, invisible vents, silent operation. Highest VEU rebates available — up to $10,290.
Typical annual saving
$1,400–$2,200
VEU rebate available
Up to $10,290
Get a free quote
Save On Energy Costs
Save on Energy Costs with Reverse Cycle Air Conditioning
Switching to reverse cycle air conditioning for home heating and cooling can dramatically cut your energy bills compared to gas. A 2.5-star multi-split costs about $400/year, while gas ducted can run up to $1,760/year.
- Lower heating costs than gas
- Year-round comfort — heating and cooling in one system
- Eco-friendly — reduces both costs and emissions
Annual running cost — heating & cooling
Gas systems
Reverse cycle — we install these
VEU rebate eligibility
Who qualifies for a VEU discount.
The household VEU heating and cooling discount is available across Victoria without an income test, including for private rental properties with the necessary owner and tenant coordination.
The new reverse cycle air conditioner must provide heating and cooling, be on the VEU approved-product register and carry the required warranty. If equipment is being replaced, it must generally be more than two years old. An accredited provider must be engaged before installation, confirm the eligible model, include the discount in the quote and manage the evidence and certificates.
Existing systems that may support a claim
- Ducted or non-ducted gas heating, including fixed room heaters
- Hard-wired electric resistance room, slab or central ducted heating
- Cooling-only refrigerative air conditioning
- Older ducted or non-ducted reverse cycle air conditioning
A property with no eligible equipment to remove may still receive a smaller discount; therefore, decommissioning is not a universal yes-or-no test. The quote must use the correct baseline, and replaced equipment must be safely decommissioned with the required evidence.
Products that are not VEU approved, cooling-only new systems, unverified DIY work and installations completed without an accredited-provider pathway do not qualify for the standard upfront discount.
Size Matters
Get the right size system — not just the cheapest quote.
Capacity is heating and cooling output in kilowatts, not electricity consumption. A unit that is too small may run continuously without holding temperature; one that is too large can cost more, cycle excessively and produce wider temperature swings. AEU should complete an on-site load assessment that considers floor area and ceiling height, insulation and draughts, glazing, orientation and shade, construction, local winter conditions, occupancy, room use, airflow, outdoor-unit clearance, noise, switchboard capacity and future electrification.
Get a free site assessment →Room size
Example
Indicative heating output
Up to 20m²
Bedroom or study
2.5–3 kW
21–40m²
Ensuite bedroom or small lounge
3–5 kW
41–60m²
Lounge or large kitchen
5–8 kW
More than 60m²
Open-plan area or large lounge
8 kW+
Indicative only — actual sizing follows an on-site load assessment.
Use this Victorian Government table only as a first pass. Ducted design also needs room-by-room air volumes, return-air sizing, zone diversity and duct heat-loss calculations. Existing gas ducts often need replacement when converting to reverse cycle.
Source: energy.vic.gov.au — choosing the right reverse cycle air conditioner
Trusted HVAC Brands We Install
Australia's leading
reverse cycle brands.
AEU works across Mitsubishi Electric, Mitsubishi Heavy Industries, Daikin, Fujitsu, Midea and Panasonic ranges. Check VEU approval, rated heating output, zoned energy label, sound power, controller, warranty and service support model by model.
Best value
Mitsubishi Electric
Wall-mounted, multi-split and ducted units with varied indoor formats and integrated control options.
Mitsubishi Heavy
A focused split and ducted range to compare on heating output and low-temperature performance in colder Victorian locations.
Popular
Daikin
Wall-mounted, multi-split and ducted options, including underfloor ducted configurations where ceiling routes are impractical.
Fujitsu
Residential splits and high-capacity single-phase ducted options for designs that need substantial output without three-phase supply.
Midea
Value-focused split, ducted and multi-head or VRF configurations for budget-conscious, independently controlled rooms.
Panasonic
Split and R32 ducted options with model-specific choices for controls, air treatment and zoning.
Recent Installs
See our work.
Real homes. Real results.
$0 upfront finance
Get installed. Pay nothing today.
Pay nothing today may be available to approved applicants through AEU's heating and cooling finance options, including the named CommBank Home Energy Upgrades option where eligible. Finance is separate from the VEU discount and is subject to lender approval, fees, terms and credit criteria. Before accepting, compare the cash price, VEU deduction, deposit, repayment amount, term, interest and total amount repayable. A $0 deposit is not a $0-cost system.
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$0 deposit — nothing to pay upfront
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Up to $10,290 VEU rebate applied before you pay
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Interest-free options available — pay off with your savings
Check my $0 options →
60 seconds · No obligation
Our finance partners
Interest-free & green loans
$0 deposit · No interest ever · Same-day approval
Best rates in Australia
Access to Australia's widest lender panel · Flexible terms
Major lender programs
AEU is an accredited installer under major Australian lender energy-upgrade programs, offered through third-party finance providers including Brighte and Boom Power.
Green loan
Competitive green loan rates · Fast online approval
*Subject to lender approval. We'll find the right option for you.
Established
2017
The founders' story
"Most energy companies are owned by people who chose this industry. We were already in it."
Australian Energy Upgrades was founded in 2017 by two brothers, one of whom is a licensed electrical contractor. As a family-owned team, AEU has worked in the energy industry since 2014 and operates as a Registered Electrical Contractor (REC 23631). The design starts at your switchboard and usage rather than a package. The same team stays with the job from network approval to after-sales support.
Licensed & accredited
Founded by tradies, led with purpose
Tom & Sam Vandermark
Founders, AEU
Verified reviews
Loved by thousands of Aussie homeowners
Read verified heating and cooling feedback from homeowners who have dealt with AEU from quote through installation and commissioning.
Cam McG
Google Review
★★★★★
2 weeks ago
Great service, integrity and efficient trades highly recommend Australian Energy Upgrades for Solar installations.
Steve Herrity
Google Review
★★★★★
3 weeks ago
Dealt with Dean Hopkins, Dean was right on point with information, recommendations for our solar needs. When the job was booked in the team arrived bang on time they were very professional and got the whole job done in a day, they explained how it all worked and keeped it in basic language making it easy to understand. We were so impressed we have just order a new water pump heater. Thanks to all the team Dean.
Meredith Quick
Google Review
★★★★★
a month ago
Great experience from start to finish. The installation was timely and completed without a hitch. Great job by everybody!
Rodney Graham
Google Review
★★★★★
a month ago
I could not fault this company, really straight talking and very knowledgeable at to what would suit my property. I conclusion these guys are in a league of there own and would highly recommend them. Rodney
Robert Ormiston-Smith
Google Review
★★★★★
a month ago
Very prompt and efficient install of hot water heat pump and the price was very competitive. Very easy to deal with and I have no hesitation in recommending them. I am now considering Australian Energy Upgrades for a gas ducted heater replacement. By
Cam McG
Google Review
★★★★★
2 weeks ago
Great service, integrity and efficient trades highly recommend Australian Energy Upgrades for Solar installations.
Steve Herrity
Google Review
★★★★★
3 weeks ago
Dealt with Dean Hopkins, Dean was right on point with information, recommendations for our solar needs. When the job was booked in the team arrived bang on time they were very professional and got the whole job done in a day, they explained how it all worked and keeped it in basic language making it easy to understand. We were so impressed we have just order a new water pump heater. Thanks to all the team Dean.
Meredith Quick
Google Review
★★★★★
a month ago
Great experience from start to finish. The installation was timely and completed without a hitch. Great job by everybody!
Rodney Graham
Google Review
★★★★★
a month ago
I could not fault this company, really straight talking and very knowledgeable at to what would suit my property. I conclusion these guys are in a league of there own and would highly recommend them. Rodney
Robert Ormiston-Smith
Google Review
★★★★★
a month ago
Very prompt and efficient install of hot water heat pump and the price was very competitive. Very easy to deal with and I have no hesitation in recommending them. I am now considering Australian Energy Upgrades for a gas ducted heater replacement. By
Accredited & certified
The accreditations that protect you — and hold us accountable.
Solar Victoria-approved installer
Authorised by the Victorian Government to deliver rebates directly at point of sale — your incentives processed correctly, every time.
Registered Electrical Contractor
Licensed by EnergySafe Victoria. Every installation is completed by a licensed electrician — legally certified, compliant and safe.
CM3 certified
Independently verified work health & safety management — required by Australia's largest commercial clients.
Tesla certified
Factory-trained and certified by Tesla to design and install Powerwall systems with full manufacturer warranty.
SAA accredited designer & installer
Solar Accreditation Australia — the national standard for solar and HVAC system design and installation.
New Energy Tech Consumer Code
Signatory to Australia's consumer protection code — bound by transparent pricing, fair contracts and honest sales practices.
Guides & insights
Expert advice on heating,
cooling & government rebates
Heating & Cooling
Read the guide →
Government Rebates
How to size your HVAC system for maximum efficiency
Why room area is only the first input in a residential load calculation.
Ducted Systems
Best practices for efficient home heating and cooling
Insulation, draught sealing, zoning, set-points and maintenance.
Free · No obligation
Check your HVAC rebate eligibility
Find out how much VEU rebate you qualify for. Free assessment. Rebates applied upfront. No paperwork on your end.
Certified & accredited
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Common questions
Heating & cooling questions — answered
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Since 2017: family-owned Australian energy-upgrade specialist. 5,000+ customers and businesses shown on AEU’s current About page. REC 23631: Registered Electrical Contractor. 30 years: AEU heating and cooling workmanship warranty. Australian Energy Upgrades was founded in 2017 by brothers Tom and Sam Vandermark. One team coordinates the site assessment, system design, incentive paperwork, installation, commissioning and after-sales support. Before a gas-to-reverse-cycle upgrade in Victoria goes ahead, AEU checks the electrical supply, outdoor-unit position, pipe or duct routes, controls and the evidence needed for decommissioning.
AEU positions its 30-year workmanship guarantee as long-term cover for installation workmanship, separate from the manufacturer’s product warranty. Work is completed by appropriately licensed electrical and refrigeration trades, with the relevant electrical, refrigerant and gas compliance certificates supplied at handover. Your proposal and AEU’s published heating and cooling terms should state exactly which work the guarantee covers, along with exclusions, servicing conditions and the claims process.
A split system rebate in Victoria is not the same as a multi-split or ducted reverse cycle rebate. VEU value changes with the old equipment, the new system’s type and capacity, approved-product status and the market value of Victorian Energy Efficiency Certificates. The following figures are current Victorian Government household examples current at August 2026, not fixed AEU offers.
Split System — Targeted Comfort
One outdoor unit connects to one indoor head. A single split suits a bedroom, study, living room or open-plan zone and is often the lowest-cost way to electrify the rooms used most. Separate units also let you leave empty rooms off.
For an approved 3–9 kW model, indicative VEU discounts range from $630–$1,610 when replacing a non-ducted gas heater, up to $840 for hard-wired resistance heating and about $210 for an older non-ducted reverse cycle unit. With nothing eligible to decommission, the example falls to $70–$140. Typical annual saving: up to $460 in the Victorian Government’s eligible gas-replacement example.
Multi-Split System — Several Rooms, One Outdoor Unit
A multi-split connects several indoor heads to one outdoor unit, which can solve limited outdoor space while preserving room-by-room control. The design must account for simultaneous demand: the outdoor unit cannot always deliver every indoor head’s nameplate output at once. The current official example for a 10 kW multi-split replacing ducted gas is up to $2,940.
Four separate splits — one 8 kW and three 3 kW units — may attract up to $2,520. In Sustainability Victoria’s 100 m² model, a multi-split costs about $771–$1,448 less a year to heat than unzoned 3–6 star ducted gas, depending on system rating. A useful proposal includes the indoor-unit schedule, outdoor-unit diversity, sound data and winter heating output.
Ducted Reverse Cycle — Zoned Whole-Home Control
A central unit sends heated or cooled air through insulated ducts and ceiling or floor outlets. It is the closest functional replacement for whole-home gas ducted heating, with cooling added. Good zoning keeps bedrooms and living areas independent, while correct return-air sizing and sealed, insulated ducts limit losses.
For ducted gas replacement, current examples are up to $2,520 at 10 kW, $4,200 at 16 kW and $5,530 at 22.4 kW. Central electric resistance replacement is up to $5,460; replacing an old 22.4 kW ducted reverse cycle unit is up to $910. The Victorian Government estimates annual bill savings of up to $1,140 for an eligible large ducted upgrade. Tariffs, insulation, zoning, set-points and operating hours determine the household result.
Reverse cycle systems move heat rather than creating it by combustion or electric resistance. In Sustainability Victoria’s current small-home comparison, the modelled annual heating cost is $513 for a 2.5-star multi-split, $769 for a 1.5-star multi-split and $1,153 for an unzoned 1-star ducted reverse cycle system. The same comparison puts unzoned ducted gas at $1,540 for a 6-star unit, $1,754 at 4 stars and $1,961 at 3 stars.
What the numbers do and do not tell you
These are comparative estimates, not a bill guarantee. The best decision uses your floor area, building fabric, local climate, energy tariff and operating pattern.
Residential solar can reduce daytime electricity purchases, while solar battery storage can shift stored energy into evening heating. Draught sealing and insulation reduce the load before a larger system is considered.
AEU is a Registered Electrical Contractor (REC 23631). Its wider company credentials include Solar Accreditation Australia credentials, Solar Victoria approved-retailer requirements, CM3 contractor prequalification, New Energy Tech Consumer Code approval and NECA membership. Each credential should be presented for what it covers. Tesla certification has been omitted from this service page because it does not establish heating and cooling competence. HVAC work must be completed by appropriately licensed trades, with the required electrical and refrigerant compliance document supplied at handover.
Availability is confirmed from the property postcode and project type. Planning a broader home-energy upgrade? Compare heat-pump hot water, residential solar, solar battery storage and home EV charger installation.
Melbourne metro
Melbourne CBD, North Melbourne, Richmond, Kew, Balwyn, Box Hill, Doncaster, Doncaster East, Donvale, Glen Waverley, Ringwood, Preston, Sunbury, Melton, Point Cook, Hoppers Crossing, Werribee, Wyndham Vale, Narre Warren, Pakenham, Dandenong, Cranbourne, Frankston, Mornington and Seaford.
Geelong, Bellarine and Surf Coast
Geelong, North Geelong, West Geelong, Newtown, Belmont, Highton, Grovedale, Hamlyn Heights, Lara, Leopold, Moolap, Whittington, Waurn Ponds, Armstrong Creek, Charlemont, Ocean Grove, Barwon Heads, Drysdale, Clifton Springs, Portarlington, St Leonards, Indented Head, Queenscliff, Torquay, Anglesea and Wallington.
Regional Victoria
Ballarat, Bendigo, Colac, Mildura, Shepparton, Morwell, Traralgon, Warragul, Wonthaggi, Bannockburn and the Grampians.
New South Wales
Sydney and selected surrounding service areas.
A split suits one room or open zone. A multi-split serves several rooms from one outdoor unit where outdoor space is tight. Ducted reverse cycle provides discreet whole-home coverage through vents. Compare how many rooms run together, available pipe or duct routes, noise, appearance and budget. Several efficient splits can cost less to run than an unzoned ducted system when unused rooms remain off.
It is not a flat rebate. The accredited provider identifies the old equipment and approved new model, then calculates certificates from the system type, capacity, efficiency and VEU method. Certificate prices and provider costs affect the dollar value. Current examples run from $70–$140 for a new 3–9 kW split with nothing decommissioned to $5,530 for a 22.4 kW ducted reverse cycle system replacing ducted gas. The specific deduction belongs in your written quote.
Yes. Modern reverse cycle air conditioners are heat pumps designed to heat as well as cool. When comparing reverse cycle air conditioning Victoria-wide, look at the model’s rated heating output and cold-climate zoned energy label, not only cooling capacity. Sizing, defrost behaviour, outdoor-unit airflow and insulation matter most in colder locations such as Ballarat, Bendigo and the Dandenong Ranges.
A straightforward single split is often completed in one day. Multiple splits or a multi-split commonly take several days, while a ducted changeover may take two to five days depending on roof or underfloor access, new ducts, switchboard work, zones and removal of gas equipment. AEU should confirm scope, access, electrical work, decommissioning and commissioning before scheduling.
Possibly, but the discount is normally much smaller. Victorian Government examples allow about $70–$140 for a 3–9 kW system with no decommissioned product, compared with $630–$1,610 when eligible non-ducted gas heating is removed. If gas remains for other appliances, ask whether closing the gas account after later electrification would avoid the daily supply charge.
No. VEU is a Victorian program. NSW households may have different certificate pathways or retailer offers, and the product, baseline and installer rules are not interchangeable. AEU’s Sydney team can assess the current NSW pathway and provide a separate quote. Victorian discount figures do not apply to a NSW installation.
It depends on the system you replace and the system installed. Replacing ducted gas with an approved ducted reverse-cycle system attracts the largest discounts; replacing a non-ducted gas heater attracts less. AEU confirms the eligible amount before quoting and applies it upfront.
Not always. Many ducted systems up to roughly 16kW run on single phase. Larger systems generally require three phase, and where a property is single phase an upgrade may be needed. We confirm supply and switchboard capacity at assessment.
Split suits one room or a small area. Multi-split runs several indoor heads from one outdoor unit, which saves external space. Ducted conditions the whole home from one system and hides the equipment, but needs ceiling or subfloor space for duct runs.
Yes. Without zoning a ducted system conditions every room whenever it runs. Zone dampers close off unused areas so the system works against a smaller load, which cuts run time and makes overnight bedroom-only operation practical.
Rated heating output is measured at 7°C, so what matters in Ballarat, Bendigo and the ranges is output at 2°C and below. We specify cold-climate capable equipment where the location calls for it rather than sizing from the headline figure.
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A single split system is usually a one-day job. Multi-split and ducted installations typically take two to three days depending on duct runs, roof access and any switchboard work. Known site work is identified in your quote.
Where We Install
65,000+ installations.
Heating & cooling installation Melbourne & Victoria.
AEU completes residential heating and cooling installation across metropolitan Melbourne, Greater Geelong, Ballarat, Bendigo, the Latrobe Valley, Colac and the Surf Coast, plus Albury–Wodonga, Wagga Wagga and Deniliquin in southern New South Wales.
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