If you are considering ducted reverse-cycle in Victoria, quote it before 30 September 2026. The minimum you must pay out of pocket under the VEU triples from $1,000 to $3,000 on that date, and incentives on residential multi-splits get capped at 20kW. Small single splits are untouched.
What exactly changes on September 30
The Victorian government announced the change in July 2026 following its review of the VEU's heating and cooling activity. Two things happen:
| System | Now | From 30 Sept 2026 |
|---|---|---|
| Single split under 10kW | $200 min co-payment | $200 (no change) |
| Multi-split under 10kW | $1,000 min co-payment | $1,000 (no change) |
| Ducted reverse-cycle | $1,000 min co-payment | $3,000 |
| Multi-split 10kW+ | $1,000 min co-payment | $3,000 |
| Residential multi-split over 20kW | Full incentive | Incentive capped at 20kW |
Source: DEECA, VEU latest industry news, energy.vic.gov.au, re-checked 2 September 2026. Some industry sites report a 17kW cap or a 31 July date; both come from earlier consultation drafts. The announced decision is 20kW and 30 September.
DEECA's wording is explicit — the cap "will not apply to installations in non-residential premises." If you are putting a large multi-split into a shop, office or other commercial site, the 20kW cap does not affect you. The higher co-payment on ducted and 10kW-plus multi-splits is not limited that way.
When we first published this in August the change was still formally a proposal — the department's language was that it "proposes to" make the changes and the VEU Specifications had not been updated. DEECA has since finalised them. There is no longer a question of whether it happens.
The detail that matters more now is what has to be finished by the date. The installation must be completed and accredited before 30 September 2026 to receive the current incentive levels. A signed contract or a paid deposit before the deadline does not carry the old co-payment if the job is completed after it. If you are quoting now, four weeks out, ask the provider in writing to commit to a completion date — not an installation booking, a completion.
What it means in dollars
The headline VEU discounts on ducted systems, up to $5,530 when replacing ducted gas heating, are generated the same way before and after the change. What moves is the floor: today a provider can discount a big ducted job down to $1,000 out of pocket, from September 30 they cannot go below $3,000. If your quote would have landed anywhere near the old floor, the change costs you up to $2,000. If your discount was modest anyway, you may notice nothing.
Put actual numbers on it. A whole-home ducted system in Melbourne runs $8,000–$16,000 installed before any discount. Take a $12,000 job replacing ducted gas heating, where the VEU discount is large enough to reach the floor: today you pay $1,000 and the certificates cover the rest. From 30 September the same job costs you $3,000. Nothing about the system, the installer or the certificates changed — only the floor did.
That is the whole story, and it is worth being clear about who it does not touch. If your quote already sits well above $3,000 out of pocket, which describes most straightforward ducted replacements without gas decommissioning, the deadline changes nothing for you at all.
What comes after this
Worth knowing if you are planning a larger job: the department has said it "plans to release a consultation paper later in 2026 on further proposed changes to the activity", specifically aimed at system sizing practices. Stakeholders in the last round strongly agreed that sizing needs improving, and the department says it is "considering further changes to the activity to improve system sizing practices".
In plain terms: 30 September is unlikely to be the last change to this scheme, and the next one looks like it will target how systems are sized rather than what they cost. If you are weighing a ducted job that has been on the list for a while, that is another argument for doing it sooner.
What to do about it
- Replacing ducted gas heating, or an old ducted system? Get quotes now and aim to have the job contracted and installed before September 30. This is the group with real money on the line.
- Buying a single split? Nothing changes for you. Ignore any urgency marketing that says otherwise.
- Quoted a "free" or near-free large system? That already breaches the co-payment rules. The floor exists precisely because of those offers, choose a provider who shows the discount and co-payment as honest line items.
Full scheme detail, official discount figures and eligibility are on our Victorian rebate page.
Six weeks is enough time, barely. Ducted quotes typically take a site visit, and installers' books fill towards summer. Start now and the deadline is comfortable.
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