2025 New Zealand Heat Pumps: Costs, Rebates, Warmer Kiwi Homes Eligibility, Installation and Savings — A Practical Guide

Heat pump types and typical cost ranges in 2025

Heat pump systems come in several configurations, and the final price is strongly influenced by the system type and installation complexity.

• Air‑source (split) systems: The most common choice for homes. For a single indoor and outdoor split system, purchase plus installation costs vary widely by model, capacity and site conditions. For many New Zealand households the total cost usually sits in a lower‑to‑moderate residential range.
• Multi‑split and ducted systems: These provide zoned heating and cover larger areas, which increases both equipment and installation complexity and raises cost.
• Ground‑source (geothermal) and complex systems: Systems needing ground loops, major site works, or full hydronic integration are substantially more expensive and approach commercial pricing.
• Water‑source and specialised systems: Generally used where a water heat source is available or for commercial projects; the costs reflect that added complexity.

Cost factors to watch: - Size and capacity needed for your home - Number of indoor units and heating zones - Requirement for new or upgraded electrical supply - Access and mounting difficulties (e.g., multi‑storey homes, solid walls) - Ductwork, site works, or ground loops for geothermal installations - Installer labour rates and regional demand

Obtain multiple quotes from experienced installers so you can compare system sizing, warranties, and the full scope of work rather than only the headline unit price.

What the Warmer Kiwi Homes heat pump subsidy covers and how it works in 2025

Warmer Kiwi Homes offers targeted financial assistance to help eligible homeowners install heat pumps. Key facts to note:

• The programme subsidises a significant portion of approved purchase and installation costs for qualifying heat pump installations, with a maximum subsidy amount set by the programme.
• After approval and installation under the programme, many households experience a substantially reduced out‑of‑pocket expense for a qualifying split system installation.
• The subsidy is delivered through EECA‑approved providers and installers who handle the application on the homeowner’s behalf.

Eligibility and the link to insulation: - Eligibility generally focuses on homes built before 2008 and households holding a Community Services Card, SuperGold Combo Card, or living in government‑identified low‑income areas. - A dwelling must meet EECA’s minimum ceiling and underfloor insulation standards to qualify for the heat pump subsidy. Warmer Kiwi Homes can also assist with insulation to help homes reach those standards. - EECA‑approved providers can assess eligibility and determine the right combination of insulation and heating support for the home.

Insulation: why it matters and the subsidy linkage

Insulation is both a condition for subsidy eligibility and one of the best ways to maximise heat pump savings.

• Meeting required ceiling and underfloor insulation standards reduces heat loss, which lowers the heat pump capacity needed and reduces running costs.
• The Warmer Kiwi Homes programme also supports insulation upgrades, with a separate subsidy component for insulation works in qualifying homes.
• Prioritising insulation upgrades before or alongside heat pump installation improves comfort, reduces energy use, and typically increases the payback on the heating upgrade.

Application steps and typical timeline

A straightforward sequence cuts delays and helps secure subsidy approval:

• Verify eligibility: Contact an EECA/Warmer Kiwi Homes approved provider to review your home and household circumstances.
• Obtain quotes: Ask for at least three quotes from EECA‑approved installers who can manage the subsidy application.
• Apply and schedule: Approved installers submit the subsidy application and, once approved, arrange installation.
• Installation and inspection: Installers complete the work and any post‑installation checks required by the programme.

From first quote to finished install typically takes a few weeks to a couple of months, though scheduling can take longer during busy periods.

Installation best practices to maximise performance and savings

Pick an experienced, accredited installer and follow these practical tips:

• Proper sizing: Ensure the installer conducts a room‑by‑room assessment and sizes units to the home’s heat‑loss profile; oversized or undersized units reduce comfort and increase costs.
• Combine with insulation upgrades: Do insulation and draught‑proofing work before or alongside the heat pump to boost effectiveness.
• Site preparation: Clear access paths and mounting spots, and resolve any electrical supply needs before the installer arrives.
• Seasonal timing: Scheduling installation in spring or autumn can help reduce lead times.
• Confirm warranty and service terms: Understand recommended routine maintenance and what the warranty covers.

Running costs, maintenance and expected savings

Ongoing costs and savings depend on usage patterns, climate, and home performance:

• Annual running costs for a well‑sized basic split system vary by household behaviour, insulation and local climate, but many households find running costs are much lower than older electric or inefficient heating methods.
• Routine maintenance, such as filter cleaning and an annual service by a qualified technician, preserves efficiency and typically results in modest yearly costs.
• Smart controls, correct zoning, and regular maintenance all help lower energy use and extend equipment life.

Maintain simple habits — regular filter cleaning, prompt repairs, and sensible thermostat settings — to protect efficiency and savings.

Features and technologies that improve efficiency

When comparing models, consider technologies that support long‑term efficiency:

• Inverter compressors for variable output and smoother, more efficient operation
• Modern refrigerants and high‑efficiency heat‑exchange components
• Smart thermostats and app controls for scheduling and remote management
• Zoned controls and sensors to heat only occupied areas

Ask installers to explain how these features will affect operating costs and comfort in your specific home.

Other funding sources and practical next steps

Beyond Warmer Kiwi Homes, consider: - Local council or electricity retailer programmes that may offer complementary incentives - EECA guidance and tools for home energy efficiency - Community or charity programmes that can assist eligible households with retrofit work

Practical next steps: - Check your eligibility with an EECA‑approved provider - Get at least three EECA‑approved quotes that include the full scope of work - Prioritise insulation and draught‑proofing where needed - Plan for routine maintenance to protect savings

Deciding which system suits your home

Choosing the right system depends on balancing household needs, building layout, and long‑term running costs:

• For many households, a correctly sized split system heat pump gives the best balance of affordability and performance.
• Larger, whole‑house ducted systems or geothermal solutions fit larger or unusual properties but demand careful analysis of long‑term costs and benefits.
• Always request a heat‑loss assessment and ensure appropriate insulation before committing to a system.

Conclusion

In 2025, heat pumps continue to be a practical way to achieve warmer, healthier, and more energy‑efficient homes in New Zealand. By understanding system types, how the Warmer Kiwi Homes programme ties subsidies to insulation, and by following installation and maintenance best practices, homeowners can make informed choices that boost comfort while managing ongoing energy costs.

Sources

• EECA — Energy Efficiency and Conservation Authority (New Zealand): https://www.eeca.govt.nz/
• Archipro — The true cost of buying and installing a heat pump in New Zealand: https://archipro.co.nz/article/heat-pump-installation-costs-new-zealand

Prices, financing options, and availability vary by region, dealer, and current promotions. Always verify current information with local dealers. Offers and incentives are subject to change and may vary by location. Terms and conditions apply.