Why Is Ducted Reverse Cycle Installation So Expensive Even after VEU Rebates?

azhar7772 on 29/06/2024 - 12:33
Last edited 29/06/2024 - 13:18 by 1 other user

I'm in the market to get a 14-16kW ducted reverse cycle system (9-10 vents) installed to replace my existing gas ducted heater. I've been doing some research and have encountered a few issues and would appreciate any advice or experiences you could share.

Background:

Previous Installation: A few years ago, I installed a 10kW ducted system at my previous property without the VEU rebate, and it cost me around $6,000.

Current Situation: Despite the availability of a $4.2k VEU rebate, the quotes I'm getting for the new installation are all upwards of $11,000 out of pocket.

Details:

Standard Pricing: From what I’ve seen, a standard 14kW unit with an installation kit sells for approximately $4,200 on trade websites like The Air Store.

Installation Charges: The quotes I'm receiving suggest that tradespeople are charging around $11,000 just for the installation, which seems excessively steep, especially considering the unit's base cost.

Concerns:

Cost Justification: I'm trying to understand why the installation costs are so high. What exactly justifies the $11,000 installation charge? Are there hidden costs or complexities I might be overlooking?

I’m looking forward to hearing your thoughts and experiences.

Electrical & Electronics Air Conditioner

Comments

  • Wiadro on 29/06/2024 - 12:46
    +1

    bro i had a 18kw system installed like 20 years ago and it cost 15k
    its 2024 and the same system is like 20k now.

    • HeWhoKnows on 30/06/2024 - 15:17

      And any time the government encouarges sales of anything by way of rebates, the costs just about double every time!

      So the government's effort to make things cheaper always backfires!

  • AustriaBargain on 29/06/2024 - 13:06

    Perhaps a lot more smaller wall units are made and sold, so they benefit from economy of scale. And fewer single large units for ducted are made and sold for home use, so it's a specialised machine? And if a business uses one they can afford to pay more a lot more than 20k to heat and cool their space.

  • ozbargainsam on 29/06/2024 - 13:31
    +1
    • Did you get more than one quote? It does seem high
    • Is the current property more than one storey?
    • Are they removing and disposing the old gas ducting and hardware?
    • Maybe you got a good deal last time?

    I had a 20kW Daikin system installed (replacing/removal of old similar system) with fresh ducting (where they could reach) in a two storey home - for around $16k (no subsidy). A couple grand of that was the MyZone thing. That was early 2021, so 'early' COVID.

    • azhar7772 on 29/06/2024 - 13:56

      Got 4 quotes - From 11k to 15k.

      Its a single storey house. All of them said they cant use the 3 year old existing gas ducting so will need new ones/bigger.

      I did get a good deal last time. Called up the same installer and he is now quoting $12k with zoning.

      • AustriaBargain on 29/06/2024 - 13:59

        Why not multiple split systems instead, is it the aesthetics of seeing the wall units on the wall you or your life partner don't like?

        • azhar7772 on 29/06/2024 - 14:02

          Partner does not like White aircon blocks on walls. Else I think a big split in the large living room will also be a good option and i keep existing gas ducted.

        • Bargain-er on 30/06/2024 - 07:19

          Yea, we are considering multi AC systems as well but not sure how it will affect house price since it will change the aesthetic and no "centralized control" unless we add wifi. As mentioned by others, VEU rebate is absorbed by installers so not as enticing to decide now.

          • sumyungguy on 30/06/2024 - 09:27

            @Bargain-er: Are you doing a new build? I did an architect-designed extension where ducted was the recommended. Pre-plumbed splits were cheaper and offer a few advantages;
            - unoccupied rooms don't get conditioned
            - you're more aware they're on which makes it more likely you'll switch them off
            - indoor units are relatively easy to clean
            - service lifetime differs for each split and we've only ever had one off-line in peak summer

            • Bargain-er on 30/06/2024 - 09:32

              @sumyungguy: No, an existing house with underfloor ducted heating (no cooling). I'm considering the Zena too but Max 6kwh may be too small for my open living room (may need to get a Cora 7.1kwh). However, i dun think it s our forever house (at this stage) and not sure if all splits will affect house price in near future. Thanks.

              • sumyungguy on 30/06/2024 - 09:37

                @Bargain-er: I reckon reverse cycle aircon (splits) will increase your house price

                • Bargain-er on 30/06/2024 - 09:39

                  @sumyungguy: Thanks mate for your feedback.

                • Bargain-er on 30/06/2024 - 09:40

                  @sumyungguy: Btw, what do you think abt the Zena? Is the WiFi feature useful (some ppl says gimmick?). Is it powerful enough? Thanks

                  • sumyungguy on 30/06/2024 - 09:50

                    @Bargain-er: I stayed in tiny house fitted with a Zena, love the aesthetics but can't comment on the capacity. I'm in Qld so the humidity demands properly sized units for cooling performance, but if you're in Melbourne this may not matter as much?

                    • Bargain-er on 30/06/2024 - 10:07

                      @sumyungguy: In Melbourne, more cold days than hot days, especially our brick house tends to be more cold than warm so we may care more for the hearing performance. Do you use the WiFi feature much? Coz that's probably the most reason I want to get Zena next to aesthetics reasons. Thanks

                      • sumyungguy on 30/06/2024 - 10:12

                        @Bargain-er: Heating performance is usually better than cooling. I have Aqara hubs to operate my Daikin splits but I hardly ever need to remote start them.

  • JIMB0 on 29/06/2024 - 13:37
    +8

    It's because these subsidies are largely soaked up by the industry and not passed onto consumers.

    • azhar7772 on 29/06/2024 - 14:00
      +6

      100%. One installer said if you want to claim VEU rebate - add $2k to the quote and I will still benefit. They are the ones who are benefitting from rebates - not the consumers. This whole VEU rebate is a sham. You will find 200 sponsored Ads on google if you search for VEU rebates - Green this, green that… all shady business charging extra under the pretense of VEU rebates.

  • ninohax on 29/06/2024 - 14:59
    +3

    $11000 for installation is nothing but absolute loot. Pretty sure they are pocketing these rebate and not passing it on. Trades people make some really good money in Australia and your case is one of the many easiest way for them to increase their income easily.

    • azhar7772 on 29/06/2024 - 15:14
      +3

      Exactly. And where they don't have to show cash in hand jobs(and pay no taxes) - there is CENTRELINK. Again - not applicable to all tradies but for the shady ones! And here I bust mein cojones the entire day at office job and not even make $400 a day after taxes at a senior role.

  • dtc on 29/06/2024 - 15:57
    +2

    I got a 16kw system installed recently and every quote was similar to yours. That’s the market. Complain all you want or keep getting quotes until you either accept it’s the market or you find some random person willing to do it cheap

    What are you being quoted on? Are you comparing the pricing for the same units - big difference between a very basic Samsung or Rinnai unit at around $5-6k purchase price and a Daiken or Panasonic at $7-9k (let alone an Actron)

    The unit is just the outdoor unit. You also need $2k plus ducting - 9 outlets is $2100 https://theairstore.com.au/product/9-outlet-8-zone-air-handl…

    Are you getting a smart controller? Thermostats for each room? Add $1k+ or more

    Are they removing and disposing the old system? That’s $1k in labour and tip fees.

    You probably need a slab for the outdoor unit. You need things rewired because the gas unit is in a different location. You need a gas fitter to disconnect and shut off the gas feed.

    • azhar7772 on 29/06/2024 - 18:45

      Looks like this is what it is going to be. Either pay up or stop complaining !

      Someone quoted for a Midea install today for under $8k, Hisense $8.5K, Mitsubishi 10k, & Daikin at $11k.

      The selling point for Midea for them is that it has 7 year warranty and is the biggest manufacturer in China. I think they also own Toshiba & Carrier.

      If I was to go with the cheapest option of Midea - do you think its worth it ?

      I dont want fancy Airtouch and 8 zones. I want something simple with 3 zones.

      • sumyungguy on 29/06/2024 - 19:15
        +1

        Do you drive an MG3 or a Mazda3? Stuff is cheap for a reason.

        • azhar7772 on 29/06/2024 - 19:50
          +1

          It is but I have seen numerous post about issues with Daikin and other top brands as well. My Westinghouse 4 door fridge broke down in <3 months, Westinghouse Washing machine was dead in 9 months so I am a bit skeptical about better brands now…. Premium does not really equal to quality these days !

          • sumyungguy on 29/06/2024 - 20:11
            +2

            @azhar7772: Westinghouse isn't premium so no need to be skeptical until you try some better brands.

      • dtc on 29/06/2024 - 19:25
        +1

        No idea if Midea is any good. The specs look ok, COP of 4 which is as good as most. I don’t know what its minimum operating percentage is (ie if you only want one zone working, can it drop to only one zone or must it still run at, say, 80% capacity). However that just goes to running cost and if you save $4000 or more up front then a few $100pa running costs still puts you ahead

        Whether the unit lives up to its specs who knows. If you just want/can afford the cheapest then give it a go.

        • azhar7772 on 29/06/2024 - 19:48

          Thanks for your input. I don't really understand COP but will read about it. I am also getting 6.6kw Solar installed next week so that should help me save some cost during the day with heating/cooling. My gas bill for the last 12 months was $2600 (gas heating + cooktop + 270L Gas hot water unit) and Elec bill was $1600. Hoping to cut some some $$$

          • dtc on 29/06/2024 - 22:54
            +1

            @azhar7772: I switched from gas heating + instant gas hot water to reverse cycle + heat pump. My gas + electricity bill for last winter (well, just May - July) was around $1900 (Canberra), most of that was heating as the instant gas doesnt use very much.

            This year electricity (no gas anymore) would be around $800 but solar reduces that to about $550 (11kw solar system). So you will definitely save. Of course, the upfront cost is pretty high as you have found; but my heater and hot water were old and broken/breaking anyway.

            Your fastest payback will come from the solar. iI you just want to save money, put in a big solar system and do the rest later only when they absolutely need replacing. Depending on where you live you should be able to use solar for 15 - 30% of your electricity during winter and probably 50% during summer. Or more.

            Wont save your gas bill though!

            • azhar7772 on 30/06/2024 - 09:48

              @dtc: Provided info to Chatgpt and this is what it suggest:

              Step 1: Estimate Future Electricity Consumption
              Current Electricity Consumption: Based on your electricity bill, your annual consumption is approximately:

              Total kWh for the last year:
              959.207 + 1298.496 + 937.263 + 1138.324 + 413.760 = 4747.05 kWh
              Additional Consumption from New Appliances:

              Induction Cooktop: Typically, an induction cooktop can consume about 300 kWh per year.
              Heat Pump Water Heater: Heat pumps are more efficient than traditional electric water heaters. For a 270L unit, an estimate is around 1000-1500 kWh per year.
              Reverse Cycle Air Conditioning: This will vary based on usage, but for a house with 12 vents, heating and cooling could consume approximately 2000-3000 kWh per year, depending on the size of your home and usage patterns.
              Total Estimated Annual Consumption:

              Current consumption: 4747.05 kWh
              Induction Cooktop: 300 kWh
              Heat Pump Water Heater: 1250 kWh (average estimate)
              Reverse Cycle System: 2500 kWh (average estimate)
              Total: 4747.05 + 300 + 1250 + 2500 = 8797.05 kWh
              Step 2: Determine Solar System Size
              To cover a significant portion of your electricity needs with solar power, you'll want a system that generates enough kWh annually to offset your consumption.

              Solar System Output in Melbourne:

              Melbourne has an average solar panel output of about 3.6 kWh per kW per day.
              Annual output per kW = 3.6 kWh/day * 365 days/year = 1314 kWh/year
              Required Solar Capacity:

              Required capacity = Total estimated annual consumption / Annual output per kW
              Required capacity = 8797.05 kWh / 1314 kWh = 6.7 kW

              • dtc on 30/06/2024 - 14:59

                @azhar7772: The problem with the solar calculation is that most of your solar production is in summer during the day, and most of your electricity use is in winter at night and early morning.

                My system is producing around 18 -24kWh per day at the moment (11kW system), but even then I'm only using around 50% of production on average since most of the production is the middle of the day and even when we are at home the heater usually isnt running in the middle of the day.

                In summer I'm expecting to generate 50kWh+ per day (could be up to 80kWh) but will probably only use 30kWh or less. However summer use for air con is generally at the same time as solar production so you can offset the use a lot more (probably 75% or more)

                Also the calculations didnt take off the electricity used by the gas heater (to run the fans etc).

  • ZloyKrys on 30/06/2024 - 08:35
    +2

    Try to get a few quotes from people who don't participate in VEU, actually many of good people don't and their prices can be lower for a better quality product, too.

    VEU is being abused

  • Geoff01 on 30/06/2024 - 21:20

    Just remember you don't need a system that will run all the outlets. If you need 10 outlets a system that will run 6 to 8 is all that's needed. We have 6 outlets in our house and a 7.5kw unit. Was 7k for Samsung. But we will only have 3 outlets on at any one time. So factor that in. We also have the simpler push button controller not the iPad style wifi which costs considerably more.

  • azhar7772 on 01/07/2024 - 18:12

    Since we are talking about rebates - has anyone upgraded their hot water system. From what I can see - there are two forms of rebates available - 1. VEU & 2. Solar Vic Rebate

    I am only eligible for VEU - so if anyone has used this and got their hot water system upgraded - I would appreciate if you can share details.

  • ranakuldeep on 01/07/2024 - 21:23

    Someone quoted for a Midea install today for under $8k, Hisense $8.5K, Mitsubishi 10k, & Daikin at $11k.
    How many outlets and how big the system kW.
    Are you able to provide the company's details name etc.

    • azhar7772 on 02/07/2024 - 09:34

      I have sent you his details.

  • azhar7772 on 02/07/2024 - 09:39
    +1

    If anyone else need details of a genuine good installer in Melbourne I have come across - let me know and I will send you his details. Ta.

    • sneatbusiness on 03/07/2024 - 13:01

      Yes please would like to know a good installer. So far I've received a quote of $12k for a Mitsubishi ducted 18kw with 6 zones and airtouch controller. I'm a little put off with how hard it is to contact the company though. Now that I saw your post, I'm wondering whether I am oversizing since I have 10 vents?

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