Can a heat pump hot water system be installed indoors?
Sometimes, but it is the exception. A heat pump needs a lot of air and it produces cold air and water. Here is why that rules out most rooms.
Usually no. A heat pump hot water system is designed to sit outdoors. And putting it inside a closed room can stop it working properly. Some models are made for indoor or ducted use. But those are specific products with strict rules.
If you are short of outdoor space, read on before you assume an indoor spot will do.
Why does a heat pump need so much air?
It pulls heat out of the surrounding air and moves it into the tank. That means a steady flow of air through the unit. In a small, closed space the heat pump cools the air it breathes, and its performance drops.
It also blows out noticeably cold air. In a cupboard or small garage that cold air has nowhere to go. Our guide to heat pump hot water explains the basic process.
What about noise?
A heat pump has a fan and a compressor, so it makes noise. Outside, that is usually fine. Mounted against a bedroom wall or in a room under living space, it can become a daily irritation. Check the noise rating on the product sheet and think about where the sound will travel.
Where does the condensate go?
As the unit cools the air, water drips out. It has to drain somewhere safe. Indoors, that means a tray and a drain line to a legal discharge point. That is plumbing work, and a blocked drain line can leak into the room.
When can an indoor install work?
It can work in a large, well-ventilated space with proper air supply, such as a big garage with ducting. Some models are built to be ducted to the outside and back. The data sheet will say if indoor use is allowed and what clearances apply.
Never decide this yourself from a brochure. If the manual does not allow it, an indoor install can void the warranty.
Things to check before you consider indoors
- Does the manual allow indoor use for this exact model?
- How much free air and clearance does it need on each side?
- Where will the cold exhaust air go?
- Where will the condensate drain, and is that discharge point allowed?
- How loud is it next to the rooms you use most?
My view: outdoors first, indoors only with a clear reason
If you have a side passage or a back wall with space, put it there. Indoors adds ducting, drainage and noise problems, and rarely saves anything. Choose indoors only when outdoor space truly does not exist, and get it in writing from the installer.
If space is the problem, a different system may suit you better. Compare options in gas, electric, heat pump or solar.
This far you can go yourself
You can measure the spaces you have, read the product manual, note where bedrooms sit and ask for the noise rating. You can also look at where water could drain.
Fitting the unit, connecting the water, the tempering valve, the pressure relief and the condensate drain are for a licensed plumber. And the electrical connection is for a licensed electrician in every Australian state and territory. Your state or territory regulator lists licensed tradespeople.
Heat pump indoors or outdoors: how they compare
Most units are built for outdoors. This table shows why an indoor spot is the harder option.
| Question | Outdoors | Indoors |
|---|---|---|
| Air supply | A steady flow of air passes through the unit | A small closed space cools the air it breathes, so performance drops |
| Cold exhaust air | It blows away | It has nowhere to go in a cupboard or small garage |
| Noise | Usually fine | Can become a daily irritation against a bedroom wall |
| Condensate | Drips away | Needs a tray and a drain line to a legal discharge point |
| Warranty | Normal installation | Can be void if the manual does not allow indoor use |
| Where it can work | A side passage or back wall with space | A large, well-ventilated space with proper air supply, or a model made to be ducted |
Read our heat pump hot water guide for how the process works.
How to find an outdoor spot before giving up
Before you accept indoors, look at what outside space you really have. These steps take a tape measure and a notepad.
- Walk the outside of the house. Look at the side passage, the back wall and any gap beside the garage.
- Read the manual for clearances. It says how much free air each side of the unit needs.
- Mark where the bedrooms sit. A fan and compressor against a bedroom wall can become a daily irritation.
- Check the noise rating. It is on the product sheet, so think about where the sound will travel.
- Look at where water could drain. Condensate drips out and has to reach a legal discharge point.
- Ask the installer to confirm the spot in writing. If outdoor space truly does not exist, get the indoor option in writing too.
If nothing works, a different system may suit you better. Compare options in gas, electric, heat pump or solar.
Frequently asked questions
Can a heat pump hot water system be installed indoors?
Only if the manual for that exact model allows it. Most are designed for outdoor use because they need a large, steady flow of air.
Why does a heat pump not work well in a small room?
It cools the air around it. In a closed space it keeps recycling that cold air, so its performance drops.
Do heat pump hot water systems make noise?
Yes, they have a fan and a compressor. Check the noise rating and keep the unit away from bedroom walls.
Where does the water from a heat pump drain?
Condensate drips out as the unit cools the air. It needs a tray and a drain line to a legal discharge point, which is plumbing work.
Sources
What this page explains is based on these official sources. If you check one and it does not match what you read here, send it to us and the article gets corrected.
- Australian Government, energy.gov.au. Hot water systems: types, installation and energy performance
- NSW Fair Trading. Plumbers, drainers and gasfitters: licensing