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 varieties, and total expense is largely dictated by system type and installation complexity.

• Air‑source (split) systems: The most common residential option. For a single indoor + outdoor split system, purchase plus installation costs vary widely based on model, capacity and site conditions. For many New Zealand homes the all‑up cost typically sits in a lower‑to‑moderate residential range.
• Multi‑split and ducted systems: These provide zoned heating across larger areas, increasing equipment and installation complexity and raising the price.
• Ground‑source (geothermal) and complex systems: Solutions involving ground loops, significant site works, or full hydronic integration cost substantially more and approach commercial‑scale pricing.
• Water‑source and specialised systems: Generally used where a water heat source is available or for commercial setups; the added complexity is reflected in higher costs.

Cost drivers to watch: - Size and capacity required for your home - Number of indoor units and heating zones - Need for a new or upgraded electrical supply - Access and mounting difficulties (for example, multi‑storey or 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 focusing only on the headline unit price.

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

Warmer Kiwi Homes gives targeted financial help to eligible homeowners installing heat pumps. Key points to know:

• The programme subsidises a large portion of approved purchase and installation costs for qualifying heat pump installs, with a maximum approved subsidy amount set by the programme.
• Once approved and installed under the programme, many households experience a significantly reduced out‑of‑pocket cost for a qualifying split system installation.
• The subsidy is managed through EECA‑approved providers and installers, who handle the application process for the homeowner.

Eligibility and how the subsidy is linked to insulation: - Eligibility generally centres 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 help with insulation to bring homes up to those standards. - EECA‑approved providers can assess eligibility and determine the right mix of insulation and heating support for each home.

Insulation: why it matters and the subsidy linkage

Insulation is both a condition for receiving the subsidy and one of the most effective ways to maximise savings from a heat pump.

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

Application steps and typical timeline

A straightforward sequence helps avoid delays and supports subsidy approval:

• Verify eligibility: Contact an EECA/Warmer Kiwi Homes approved provider to review your home and household situation.
• Obtain quotes: Request 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, organise the installation.
• Installation and inspection: Installers carry out the work and any post‑install checks required by the programme.

From first quote to completed install typically takes a few weeks to a couple of months, although scheduling can be longer during peak demand periods.

Installation best practices to maximise performance and savings

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

• Proper sizing: Ensure the installer performs a room‑by‑room assessment and sizes units according to the home’s heat‑loss profile; both oversized and undersized units can harm comfort and increase costs.
• Combine with insulation upgrades: Complete insulation and draught‑proofing work before or at the same time as the heat pump to improve outcomes.
• Site preparation: Clear access routes and mounting areas, and resolve any electrical supply needs ahead of installation.
• Seasonal timing: Installing in spring or autumn can shorten lead times.
• Confirm warranty and service terms: Understand recommended routine maintenance and what is covered by the warranty.

Running costs, maintenance and expected savings

Ongoing costs and savings vary according to usage, climate, and home performance:

• Annual running costs for a well‑sized basic split system depend on household behaviour, insulation and local climate, but many households find running costs are much lower than for older electric or inefficient heating methods.
• Routine maintenance, such as filter cleaning and an annual service by a qualified technician, keeps efficiency high and usually involves modest yearly expenses.
• Smart controls, correct zoning, and consistent maintenance all help reduce 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 improved heat‑exchange components
• Smart thermostats and app controls for scheduling and remote management
• Zoned controls and sensors to heat only occupied areas

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

Other funding sources and practical next steps

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

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

Deciding which system suits your home

Picking the right system requires balancing household needs, building layout, and long‑term running costs:

• For many households, a correctly sized split system heat pump delivers the best mix of affordability and performance.
• Larger, whole‑house ducted systems or geothermal solutions are better for larger or unusual properties but need careful evaluation of long‑term costs and benefits.
• Always request a heat‑loss assessment and ensure proper insulation before committing to a system.

Conclusion

Heat pumps continue to be a practical route to warmer, healthier, and more energy‑efficient homes in New Zealand in 2025. 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.