Victorian Air Conditioner Rebates 2026: VEU Eligibility, Discounts & How It Works
Last updated: September 2026
Victorian Air Conditioner Rebates 2026: VEU Eligibility, Discounts & How It Works
If you’re considering replacing old gas heating or upgrading your heating and cooling in Victoria, you may be eligible for an upfront discount through the Victorian Energy Upgrades (VEU) program.
The VEU program provides incentives for Victorian households and businesses to upgrade to approved, energy-efficient reverse-cycle air conditioning systems.
For homeowners replacing ducted gas heating, the discount can be significant. Depending on your existing system, the new system capacity and other eligibility requirements, the indicative discount can be up to $5,530 when replacing ducted gas heating with an eligible ducted reverse-cycle air conditioner.
The exact discount isn’t the same for every home or system, so eligibility should always be checked before proceeding with an installation.
At City Wide Air, we help Melbourne homeowners determine the right heating and cooling solution for their property, check potential VEU eligibility and coordinate the installation and associated VEU process.
Quick Answer: How Much Is the Victorian Air Conditioner Rebate in 2026?
The amount you may receive depends primarily on what heating or cooling system you currently have, what replaces it and the capacity of the new system.
Current Victorian Government indicative discounts include:
| Existing system | New system | Indicative VEU discount |
|---|---|---|
| Ducted gas heater | 10kW ducted reverse cycle | Up to $2,520 |
| Ducted gas heater | 16kW ducted reverse cycle | Up to $4,200 |
| Ducted gas heater | 22.4kW ducted reverse cycle | Up to $5,530 |
| Central electric resistance ducted heater | 10–22.4kW ducted reverse cycle | Up to $5,460 |
| Existing ducted reverse-cycle AC | 10–22.4kW eligible ducted reverse cycle | Up to $490–$910 |
| No system decommissioned | 10–22.4kW ducted reverse cycle | Up to $410 |
| Non-ducted gas heater | 3–9kW room reverse cycle | $630–$1,610 |
| No system decommissioned | 3–9kW room reverse cycle | $70–$140 |
These are indicative Victorian Government figures. Actual discounts can vary depending on the installation, system selected, certificate value and current VEU requirements.
Want to Know What Discount May Apply to Your Home?
Tell City Wide Air your suburb, existing heating system and property details and our team can assess your heating and cooling options and potential VEU eligibility.
What Is the Victorian Energy Upgrades (VEU) Program?
Victorian Energy Upgrades is a Victorian Government energy-efficiency program designed to help households and businesses reduce energy use by upgrading to more energy-efficient products.
One of the upgrades supported by the program is replacing inefficient heating and cooling equipment with an approved high-efficiency reverse-cycle air conditioner.
Under the program, accredited providers can create Victorian Energy Efficiency Certificates (VEECs)
when eligible energy-efficiency upgrades are completed.
These certificates have a financial value, which helps fund the discount provided to the customer.
This is why the VEU incentive will generally appear as an upfront discount on an eligible installation, rather than a cashback that every homeowner independently claims after purchasing an air conditioner.
HOW THE VEU AIR CONDITIONING DISCOUNT WORKS
Step 1: Request a Free Quote
Check eligibility for the heating and cooling rebate
Step 2: Quick Consultation
Receive a recommended system suitable for your home
Step 3: Professional Installation
Professional installation by experienced technicians
Step 4: Rebate Applied
Rebate applied as part of the installation process
Who Is Eligible for the VEU Air Conditioning Discount?
Victorian households and businesses can potentially access heating and cooling discounts through the VEU program.
This can include:
homeowners
businesses
private rental properties
eligible apartments and properties managed by Owners Corporations.
However, being located in Victoria does not automatically mean every air conditioner or installation qualifies.
The system and installation must meet VEU requirements.
For residential installations, an eligible reverse-cycle air conditioner must be an approved high-efficiency model that provides both heating and cooling.
Eligible residential systems are also required to have a minimum five-year warranty.
If an existing heating or cooling system is being replaced, the system being replaced generally needs to be more than two years old.
Do I Have to Replace an Existing Heater?
Not necessarily.
VEU discounts can be available for eligible installations where no existing system is being decommissioned.
However, the available incentive can be substantially higher when an inefficient existing heating system — particularly ducted gas heating — is removed and replaced.
For example, current indicative discounts for installing a qualifying 10–22.4kW ducted reverse-cycle system without decommissioning an existing product are up to $410.
Replacing ducted gas heating with an eligible ducted reverse-cycle system can currently attract an indicative discount of up to $5,530, depending on system capacity.
This is one reason gas-to-electric heating upgrades have become particularly attractive for some Victorian households.
How Much Can I Get for Replacing Ducted Gas Heating?
This is one of the most common questions Melbourne homeowners ask when considering a gas-to-electric heating upgrade.
Under the current VEU settings, indicative discounts for replacing ducted gas heating with eligible ducted reverse-cycle air conditioning are:
- 10kW system — up to $2,520
- 16kW system — up to $4,200
- 22.4kW system — up to $5,530
However, you shouldn’t choose a larger air conditioner simply because it may attract a larger incentive.
City Wide Air Installer Advice
Choose the right air conditioner for your home first and calculate the available incentive second.
An oversized or poorly designed system isn’t suddenly a good installation simply because it attracts a larger VEU discount. A professional assessment should determine the appropriate capacity and design for your home.
Can I Get a VEU Discount for a Split System?
Yes.
Eligible high-efficiency single-split and multi-split reverse-cycle air conditioners can qualify under the VEU program.
For example, replacing a non-ducted gas room heater with an eligible 3–9kW reverse-cycle air conditioner can currently attract an indicative discount between $630 and $1,610.
Other installation scenarios have different incentives.
A single-split system generally consists of one outdoor unit connected to one indoor unit and is commonly used for an individual room or open-plan area.
A multi-split system connects multiple indoor units to one outdoor unit and can be an option where several rooms require independent heating and cooling.
Your installer should be able to provide a more accurate timeframe once the job has been assessed.
Can I Get a Rebate If I Already Have Reverse-Cycle Air Conditioning?
Potentially.
The VEU program isn’t limited to households switching from gas.
Replacing an existing ducted reverse-cycle air conditioner with a qualifying high-efficiency ducted system can currently attract an indicative discount of approximately $490 to $910, depending on the new system’s capacity.
The incentive is generally much higher when replacing less efficient forms of heating because the calculated energy and emissions savings are greater.
Why Is the Discount Higher When Replacing Gas Heating?
VEU incentives are connected to the expected energy and greenhouse gas savings generated by an eligible upgrade.
Replacing an inefficient whole-home gas heater with an efficient reverse-cycle air conditioner can produce a substantial improvement in energy efficiency.
Modern reverse-cycle systems also provide both heating and cooling from the same system, making them an increasingly popular option for Melbourne homes moving away from gas heating.
From there, City Wide Air can recommend an appropriate system and provide a personalised quote based on the actual installation.
What Air Conditioners Qualify for the VEU Program?
Not every air conditioner on the market qualifies.
The system must meet VEU efficiency requirements and be included as an approved product under the program.
Eligible technologies can include:
Single-Split Systems
One outdoor unit connected to one indoor unit.
These are generally suited to individual rooms and open-plan areas.
Multi-Split Systems
One outdoor unit connected to multiple indoor units.
These can provide individual heating and cooling across several rooms without requiring a separate outdoor unit for every room.
Ducted Reverse-Cycle Systems
A central system distributes conditioned air throughout multiple areas of the home using ducts and outlets.
Ducted reverse cycle is particularly popular with homeowners wanting whole-home heating and cooling or replacing existing ducted gas heating.
Important: Don’t purchase a system assuming you can claim the VEU incentive afterwards. Eligibility should be confirmed before installation.
How Does the VEU Air Conditioning Process Work?
For most homeowners, the process is relatively straightforward.
1. Assess Your Existing System
We determine what heating and cooling equipment is currently installed and what you’re hoping to achieve with the upgrade.
2. Determine the Right Replacement System
The property is assessed so an appropriately sized and configured system can be recommended.
3. Check VEU Eligibility
The proposed system and installation are checked against current program requirements.
4. Receive Your Quote
Where applicable, your quote includes the relevant VEU discount rather than requiring you to independently navigate the program afterwards.
5. Installation
Qualified tradespeople complete the installation and any required decommissioning of the existing system.
6. VEU Documentation
The required evidence and paperwork is completed and processed through the VEU program.
Depending on the upgrade, documentation can include invoices, compliance certificates, evidence of the existing equipment and geo-tagged photographs taken before and after installation.
Do I Receive the VEU Rebate as Cash?
Generally, no.
For a normal VEU upgrade, the incentive is typically provided as an upfront discount, reducing the amount you pay for the eligible installation.
This distinction is important because people commonly refer to it as a “Victorian air conditioning rebate”, even though the program generally operates as a discount facilitated through an accredited provider.
Do I Need an Accredited VEU Provider?
Yes.
Only VEU Accredited Providers can create the certificates associated with the discount.
However, that doesn’t necessarily mean the Accredited Provider has to physically install your air conditioner.
A qualified air conditioning installer can work with an Accredited Provider to facilitate the VEU discount.
This arrangement must be established correctly as part of the upgrade process.
Can Landlords Get the Air Conditioning Rebate?
Yes.
Private rental properties can participate in VEU heating and cooling upgrades.
Landlords and tenants will need to work together where an upgrade affects the rental property, and landlord approval may be required.
Can Apartments Get the VEU Discount?
Potentially, yes.
Residential Owners Corporations and eligible apartment properties can participate in the VEU program.
However, installing air conditioning in an apartment can involve additional considerations such as:
- Owners Corporation approval
- Outdoor-unit locations
- Balcony restrictions
- bBuilding access
- Electrical capacity
- Refrigerant pipe routes
- Ceiling space
- Building rules.
City Wide Air works with complex residential and apartment air conditioning installations across Melbourne and can assess whether a proposed system is practical as well as its potential VEU eligibility.
Can I Claim the Rebate After I've Already Installed My Air Conditioner?
Don’t rely on being able to do this.
The Victorian Government advises consumers to engage with an Accredited Provider before undertaking an upgrade.
Retrospective VEU rebates can be possible in some circumstances, but they can be difficult to organise and remain subject to program requirements and submission deadlines.
If you’re considering an installation, the safest approach is to check eligibility before purchasing or installing the system.
How Much Can Reverse-Cycle Air Conditioning Save on Energy Bills?
The answer depends heavily on your existing heating system, home, energy tariff, usage patterns and replacement system.
However, the Victorian Government currently estimates households replacing ducted gas heating with an efficient reverse-cycle air conditioner may save up to $1,140 per year on energy bills, in addition to an upfront VEU discount of up to $5,530.
These are estimates rather than guaranteed savings.
Your actual running costs depend on factors including:
house size
insulation
thermostat settings
system efficiency
zoning
electricity tariff
solar generation
hours of operation
Melbourne weather conditions.
Is It Worth Replacing Ducted Gas Heating With Reverse Cycle?
For many Melbourne households, it’s worth investigating.
A ducted reverse-cycle system can provide heating and refrigerated cooling through one system, while eligible households replacing ducted gas heating may also qualify for a substantial VEU incentive.
But the decision shouldn’t be made on the rebate alone.
Consider the age and condition of your existing heater, whether you already have cooling, your home’s electrical capacity, expected running costs, system design, zoning and how long you expect to remain in the property.
City Wide Air can assess these factors before recommending whether a gas-to-electric conversion makes sense for your particular home.
Frequently Asked Questions
Is there still an air conditioning rebate in Victoria in 2026?
Yes. The Victorian Energy Upgrades program currently provides discounts for eligible high-efficiency reverse-cycle air conditioning installations.
What is the maximum VEU air conditioning discount?
For residential heating and cooling, the Victorian Government currently lists an indicative discount of up to $5,530 when replacing a ducted gas heater with an eligible ducted reverse-cycle air conditioner. Different upgrade scenarios have different maximum amounts.
Is everyone in Victoria eligible?
Victorian households and businesses can access the program, but the individual product and installation must satisfy the relevant VEU requirements.
Can renters use the VEU program?
Yes. Private rental properties can be eligible, although heating and cooling upgrades generally require cooperation and approval from the property owner.
Does a new air conditioner qualify if I'm not replacing anything?
Potentially. Eligible installations without a decommissioned product can receive a smaller discount.
Can I replace gas ducted heating with reverse-cycle air conditioning?
Yes. This is one of the major heating and cooling upgrade scenarios supported by the VEU program.
Does City Wide Air handle the VEU paperwork?
For eligible City Wide Air installations, our team can help coordinate the VEU process associated with the installation so you don’t have to navigate the process alone.
Should I choose an air conditioner based on the biggest available rebate?
No. The system should be sized and designed for your property first. The available VEU incentive should then be determined for that suitable system.
Check Your VEU Eligibility With City Wide Air
If you’re thinking about replacing gas heating, upgrading an old air conditioner or installing a new reverse-cycle system, the first step is finding out what will actually work for your home.
City Wide Air provides heating and cooling installations throughout Melbourne, including ducted reverse-cycle, split and multi-split systems.
Our team can assess your:
existing heating and cooling
home’s heating and cooling requirements
suitable system capacity
ducted, split or multi-split options
VEU-eligible systems
potential VEU discounts
installation requirements.
Tell us about your home and we’ll help you determine the right system and whether your proposed upgrade may qualify for a VEU discount.
Reviewed by City Wide Air
Josh Burgess Director, City Wide Air | Melbourne, Victoria
VEU incentives, eligibility requirements and certificate values can change. Discount amounts shown in this guide are indicative figures based on Victorian Government information available in September 2026. Your actual discount will depend on the eligible product, system capacity, existing equipment, installation and applicable VEU requirements at the time of your upgrade.
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