Air-sourced heat pumps have been classified on the SRES as a solar-powered technology, although they draw all their power from the main grid.

GIA spokesman Peter Harcus said “Under this policy each heat pump has a $2,000 advantage at installation, despite the report showing their carbon footprint is 50 per cent larger than gas hot water systems.

“Gas systems were excluded from the scheme because they do not generate electricity.”

Air-sourced heat pumps already had the lowest installation costs before they received the rebate and small technology certificates, meaning that their market share has picked up considerably at the expense of lower emissions technologies, said the GIA.