Commercial Heat Pump Water Heater Upgrade In Victoria

Commercial Heat Pumps: VIC Rebate, Refrigerants, Defrosting & More

While the governments across the globe seem to be focused on rapid adoption of zero-emission vehicles and solar panels to cut carbon emission, a new climate-tech hero has emerged on the scene — the heat pump. Though the first heat pump was created in the mid 19th century, the technology found its place in the spotlight only in the early 21st century.

Why are heat pumps tech heroes?

Unlike conventional technologies — which use gas or electricity for space heating/cooling and water heating —  a heat pump pulls warmth from surrounding air (even if it is snowing outside), amplifies it, and pumps it inside to warm a space or water inside the water tank. The heat pumps are powered by electricity, but their energy output — in the form of water heating or space heating/cooling — is 3-5 times greater than the energy consumed. Since, we are currently offering upgrades under Victoria government commercial hot water rebates program, the rest sections of this blog will be focused on the commercial heat pump powered hot water systems and rebate application process.

Commercial Heat pumps offered under Victoria government programs

The Victoria government has set an ambitious target of 45-50 percent emission reduction — to 2005 emission levels — and net-zero emissions by 2050. To achieve this target, reducing emissions in the electricity sector — which accounted for 51.8% of Victoria’s total net emissions in 2021 —  becomes all important. About a quarter of the total electricity produced is consumed by commercial buildings in Australia, and appliances like water heaters, air conditioners and freezers are responsible for the highest energy use. Energy-efficient appliances can reduce the energy consumption and decarbonise commercial buildings by a large margin. The reduction achieved by achieving higher energy efficiency will in turn result in more energy and money savings for businesses and reduce their carbon footprints. If you run a business in Victoria state, achieving energy efficiency in your office/workplace building has never been so doable and budget friendly. The Victorian government —under the Victorian Energy Upgrades Program — is offering free replacement of your commercial electric boilers/water heaters with air-sourced heat pump powered commercial water heaters. The rebates are also on offer for replacement of gas-fired water heaters with heat pump units. The 3 to 5X energy efficiency achieved by heat pumps offer a great advantage for businesses who are looking to reduce their operating cost and carbon footprints. However, to achieve this, there are the following variables you need to factor in to achieve the maximum quantum of reduction in energy demand at your business:
  • COP (Coefficient Of Performance) of heat pump unit.
  • Quality of installation.
  • Size of heat pump system
  • Energy star rating
  • Compressor efficiency
  • Type of compressor
  • Insulation of pipes and water tank
  • Warranty

Application of heat pump technology in Industrial & Commercial sector

Heat pump technology is used in a range of industrial and commercial applications, such as:
  • Product heating and cooling in agro-based industries.
  • Space heating and cooling in agriculture and industries
  • Water heating and steam generation in industrial applications
  • Pool water heating and cooling in swimming pools
  • Air heating in agribusinesses and industries
  • Drying, cooling, boiling, distillation, and blanching in food & beverages industries.
  • Drying, melting and preheating in food processing applications

Upsides of commercial heat pump water heater 

Employing Heat pumps in commercial and industrial applications offers the following advantages: High energy-efficiency Commercial heat pumps offer 3–5 times COP (Coefficient of Performance) than their gas or resistance counterparts.  This makes them suitable for reducing energy demand and energy bills of the various commercial and industrial processes. Low operating cost  The cost of running heat pumps is always lower than gas-fired or electric boilers.  Here is a comparison of the operating cost of various commercial heating technologies.
Comparing the operating cost of various commercial heating technologies

Comparing the operating cost of various commercial heating technologies.

As we can see in this chart, a commercial air-source heat pump can deliver 1 GJ (gigajoules) of heat (when electricity is charged @120/MWh) for $12.92.  The resistive water heater delivers the same heat for $33.33 and gas-fired steam boilers deliver the same amount of heat for $30.60 (when electricity is priced @ $24/GJ) and for $15.65 (when electricity is priced @ $12/GJ). Low maintenance cost Rightly sized and installed heat pumps need less maintenance than their electric and gas counterparts. Maintenance is only required if the manufacturer has recommended replacing air filters and cleaning evaporator and condenser coils after a certain period of time. One can find the coils and filters replacement schedule in the product document supplied with the heat pump system. Lower emissions Due to higher energy-efficiency, heat pumps produce lower emissions even if the electricity grid is powered by the coal-fired power plants.  As the Australian electricity grid is getting decarbonised every year and its emission factor (amount of CO2 per MWh of generated power) is expected to reduce to less than 0.3–0.45 t CO2/MWh by 2030, replacing resistive and gas-fired boilers/water heaters with heat pumps will deliver a substantial reduction in businesses and industrials sites. Pairing with solar panels  Powering heat pumps with solar panels can further reduce operating cost of heat pumps and achieve the holy grail of climate conscious businesses — net-zero emissions. Integrating with thermal storage systems Integrating heat pumps with thermal storage units (such as insulated water tanks) offers several advantages, such as:
  • Reduced heat loss from the stored water.
  • More efficiency
  • More savings: thermal storage systems can be programmed to store thermal energy during off-peak hours and utilize it during peak hours. It saves money and reduces dependence on the electricity grid.
Safety benefits Heat pumps reduce fire hazards in commercial and industrial processes as they are fully electric and handling of combustible fuels/gasses (as in the case of gas-fired boilers) is not required.

Downsides of heat pump water heaters

Despite the above advantages that heat pump hot water systems offer, they are associated with the following drawbacks: Limited efficiency in colder climate As the heat pump systems are primed for sourcing warmth of outdoor or ambient air and transferring it to the sink (which may be a water tank or a space inside a building), the efficiency of heat pumps drops significantly when the outdoor air temperature falls below zero degree celsius. The sub-zero temperature conditions (during the winter months of June, July, and August) in Victoria state are not a concern, as the average temperatures range from 6.5 C to 14.2 C during these months. Limited output temperature Most commercial heat pump water heating units can achieve maximum output temperature in the 60 to 80 degree celsius range. Some heat pumps use auxiliary resistive heating (called booster) to increase the max output temperature range, but it makes them less efficient. Cost Heat pump technology based commercial water heaters are more expensive — than gas and electric — upfront. Businesses in Victoria can utilize the government rebates/incentives to reduce the upfront cost.

Refrigerant consideration in commercial heat pumps 

Refrigerant’s global warming potential (GWP) and toxicity level are two key considerations that one needs to consider while choosing earth-friendly and safe commercial water heating systems. GWP is the heat trapping potential (relative to carbon dioxide) of a substance. A heat pump with carbon dioxide refrigerant has a GWP of 1.  All natural refrigerants like CO2 (R744), propane (R290) and ammonia (R717) have low global warming potential. Among these natural refrigerants, carbon dioxide has a low toxicity level and ammonia — which is a flammable and corrosive gas — has a high toxicity level. Let us walk you through the upgrade process.

Defrosting heat pump 

During normal operating conditions, air source heat pumps sources the warmth from ambient outdoor air and transfers it to a heat sink such as indoor space or water storage unit. However, in cold winter days when outdoor air temperature dips below freezing (0 °C) and wind speed is below 16 km/h, moisture in the air condenses into ice crystals, frost starts forming on the fins of evaporator coils of the heat pump. When the air temperature continues falling several notches below the zero degree Celsius, a thick layer of frost can form on the fins. At this stage, removing the frost is the only way to resume the heat transfer from outdoor air to a water tank or an indoor space. Commercial heat pump water heaters automatically defrost the evaporator fins by reversing the refrigeration flow. It is achieved by a four-way reversing valve (a solenoid coil operated valve) and heat pump sensors monitoring the air temperature and accumulation of frost on fins of evaporator coils. The reversing valve directs the passage of hot refrigerant from the compressor to the evaporator coils to melt the build-up of frost and ice. Some commercial air source heat pump water heating systems also have an auxiliary water tank to prevent heat loss in the main water tank during the defrost cycle. Most commercial heat pump water heaters employ a hot gas defrost method to defrost the evaporator coils.