Heat Recovery Ventilation: What is it?
Your Guide to HRV's and why they're Neccesary
We first became aware of Heat Recovery Ventilation (HRV) technology around 2017–2018, and it immediately caught our attention. Having been in the ventilation industry since the 1980s, we here at universal fans witnessed how the ventilation industry has slowly evolved and adapted new technologies, but HRVs had a different kind of promise. The concept has been around overseas since the post-war building boom of the 1950s – evolving through decades of design improvements and gaining real momentum in the 1990s with the establishment of modern, airtight housing. By the time we encountered it here, the technology had already being refined to suit a wider range of climates and building styles.
At its core, an HRV system extracts stale indoor air and brings in fresh outdoor air, but with one clever twist: it passes the two streams through a heat exchanger so the warmth (or coolness) from the outgoing air is transferred to the incoming air. In winter, that means fresh air enters your home already pre-warmed, and in summer, it arrives pre-cooled. The result? You get continuous fresh ventilation without throwing away the energy you’ve already spent heating or cooling your home — and without overworking your HVAC system.
Our team has seen first-hand how this simple principle can transform the comfort and air quality of a building. That’s why we’ve put together this guide: to share our experience, answer the most common questions we hear from customers, and help you decide if an HRV system is the right investment for your home or business
In This Article:
Understanding Heat Recovery Ventilation:
What is “Heat Recovery Ventilation”?
Heat Recovery Ventilation (HRV) is a system designed to provide fresh, filtered air to a building while minimising heat loss
It works by extracting stale, moisture-laden air from inside and replacing it with fresh air from outside, passing both streams through a heat exchanger so the warmth from the outgoing air is transferred to the incoming air. This process means you can maintain a comfortable indoor temperature without wasting energy on reheating or recooling the incoming air.
In well-sealed, energy-efficient homes, HRV plays a vital role in improving air quality, reducing condensation, and preventing mould growth—all while lowering heating and cooling costs.
A Quick History of HRV’s
The History
What do HRV’s actually do?
| Cycle | How it works | What it does for you |
|---|---|---|
| 1. Fresh air intake | Draws outdoor air in through a weatherproof vent, even when the building is well sealed. | Delivers a steady supply of clean air without opening windows — less noise, dust, and pollen. |
| 2. Heat exchange | Incoming and outgoing airstreams pass through a heat exchanger; they don’t mix, but heat (or cool) transfers across. | Pre-warms or pre-cools the fresh air, reducing heating/cooling load and running costs. |
| 3. Stale air extraction | Moist, stale indoor air is drawn from wet rooms and living spaces to the exchanger and exhausted outside. | Prevents condensation, damp, and mould; improves indoor air quality. |
| 4. Continuous balance | Supply and extract run together to keep airflow balanced and temperatures stable. | Consistent comfort and fresher air all day, with efficient energy use. |
Heat Recovery Ventilation isn’t widely used in Australia yet but that doesn’t mean we don’t need it.
According to the Australian government’s Your Home website, 15-25% of heat loss from buildings is caused by air leaking out of the building. Air leakage makes buildings more difficult to heat and so they are less energy efficient. Not only is this bad for the environment, heating an unsealed building also costs more money. As Australians become more energy conscious, they seal more of the little cracks around windows and doors that let the air escape from the building. New buildings are also often built with insulation and efficiency in mind. This makes sense, especially because heating and air conditioning continue to drive up energy bills. Stopping air leakage helps households and businesses take control of their expenses. But sometimes solving one problem creates another. Although sealing the building stops warm air from leaking out, fresh air can’t come in either!
Why Do We Need Heat Recovery Ventilation?
Heat Recovery Ventilation isn’t widely used in Australia yet but that doesn’t mean we don’t need it. According to the Australian government’s Your Home website, 15-25% of heat loss from buildings is caused by air leaking out of the building. Air leakage makes buildings more difficult to heat and so they are less energy efficient. Not only is this bad for the environment, heating an unsealed building also costs more money. As Australians become more energy conscious, they seal more of the little cracks around windows and doors that let the air escape from the building. New buildings are also often built with insulation and efficiency in mind. This makes sense, especially because heating and air conditioning continue to drive up energy bills. Stopping air leakage helps households and businesses take control of their expenses. But sometimes solving one problem creates another. Although sealing the building stops warm air from leaking out, fresh air can’t come in either!
Preventing fresh air from entering reduces the air quality in the room, making it stale. This is partly because humans breathe in oxygen and breathe out carbon dioxide. Sealing a building to increase energy efficiency stops the carbon dioxide from flowing outside and oxygen from flowing in to replace it. This means that a poorly ventilated building will have a higher concentration of CO2 than a building with good ventilation. We breathe out moisture as well as carbon-dioxide. Households also create moisture from use of showers, cookers and laundry appliances (just a few examples). As moisture builds up inside, it creates condensation which can lead to mould growth. All of this is bad for the air quality if there isn’t any new air coming in to push the old air out. Of course, opening a window swaps the old stale air for fresh new air. But this undoes all the time and effort already invested in sealing the building. In Winter months, opening a window cools a space very quickly.
Heat recovery ventilation systems offer a solution by allowing fresh air to enter a building without letting cool air affect the inside temperature.
Does Heat Recovery Ventilation work in Australia?
yes
The Cost Benefits of Heat Recovery Ventilation
The Cost benefits
How Heat Recovery Ventilation can Support Your Health
Preventing fresh air from entering reduces the air quality in the room, making it stale. This is partly because humans breathe in oxygen and breathe out carbon dioxide. Sealing a building to increase energy efficiency stops the carbon dioxide from flowing outside and oxygen from flowing in to replace it. This means that a poorly ventilated building will have a higher concentration of CO2 than a building with good ventilation. We breathe out moisture as well as carbon-dioxide. Households also create moisture from use of showers, cookers and laundry appliances (just a few examples). As moisture builds up inside, it creates condensation which can lead to mould growth. All of this is bad for the air quality if there isn’t any new air coming in to push the old air out. Of course, opening a window swaps the old stale air for fresh new air. But this undoes all the time and effort already invested in sealing the building. In Winter months, opening a window cools a space very quickly.
Heat recovery ventilation systems offer a solution by allowing fresh air to enter a building without letting cool air affect the inside temperature.
How effective is a Heat Recovery Ventilation system?
It’s not yet possible to preserve all of the heat energy as it passes through an HRV, but the technology continues to get better. At Universal fans we carry a range of heat recovery units that incorporate the latest technology. Because they aren’t widely used in Australia yet, it’s difficult to say how the energy savings might translate onto a gas or electricity bill. But HRV systems are already common in Europe. Over there, the general consensus is that they reduce heating costs but it will take time to offset the cost of installation. It’s also worth remembering that just sealing a building reduces energy costs by up to 20 per cent, according to a 2006 report by the Sustainable Energy Authority of Victoria. But a sealed building without any ventilation is unpleasant to live or work in.
HRV’s a Recap
Recap Table
What are the different types of Heat Recovery Systems?
Centralised VS Decentralised At A Glance
Heat recovery systems generally fall into two main categories: centralised and decentralised.
Centralised units service an entire building from a single, integrated system, while decentralised units are designed to ventilate individual rooms or zones. The best choice depends on factors like property size, layout, and energy efficiency goals—something we’ll explore in more detail below.
| Feature / Consideration | Centralised Heat Recovery Ventilation | Decentralised Heat Recovery Ventilation |
|---|---|---|
| Coverage | Whole-house system delivering fresh air to multiple rooms via ducting | Targets individual rooms or zones with standalone units |
| Installation Location | Central air handling unit connected to a duct network | Through-wall installation directly in the room served |
| Heat Recovery Efficiency | High efficiency (example: Fanco Habitat Central up to 92%) | High efficiency in a single space (example: Fanco Habitat Series up to 95%) |
| Airflow Balance | Dual motors provide balanced supply and extraction across the home | Operates in alternating cycles, extracting then supplying air |
| Humidity Control | Can manage humidity across the whole home with enthalpy technology | Controls humidity in targeted rooms via integrated sensors |
| Best Suited For | New builds, well-sealed energy-efficient homes, and full-home retrofits with duct access | Renovations, apartments, heritage homes, and targeted problem areas without duct access |
| Scalability | One unit covers the entire building | Multiple units can be installed for broader coverage, but operate independently |
| Installation Complexity | Requires duct design, plant space, and professional installation | Minimal construction work; simpler to retrofit |
| Cost Profile | Higher upfront cost due to equipment and ducting | Lower initial cost per unit; scalable investment over time |
A centralised Heat Recovery Ventilation System has several elements:
- An incoming vent in at least one room of the building
- A corresponding outgoing vent for each incoming vent
- An air handling unit with heat recovery.
The incoming vents bring in fresh air from outside the building. As the air comes in through the roof, it passes through the heat exchanger. At the same time the stale (but warm) air is flowing in the opposite direction from inside the house. It also passes through the heat exchange mechanism, but it does not mix with the cool fresh air. Instead the two types of air pass alongside each other in separate pipes. The warm air from inside the building heats the fresh cool air from outside. The fresh air is now warm and flows into the building. There you go! You can stay cosy and breathe fresh air!
These design strengths translate directly into lifestyle and health improvements. By recovering humidity as well as heat, the Habitat Central helps maintain a stable indoor environment—retaining beneficial moisture in dry winters and reducing excess in humid summers. This is particularly important for respiratory health, skin hydration, and protecting timber furnishings from seasonal changes. With optional indoor-air-quality sensors for CO₂, PM₂.₅, temperature, and humidity, the system can automatically adjust ventilation rates in real time, ensuring you’re always breathing fresh, filtered air without sacrificing efficiency.
While many decentralised units can match high recovery rates in a single room, achieving the same consistency across an entire home can require multiple devices and more manual control. A centralised system like the Habitat Central delivers that performance in one integrated package, making it easier to maintain even comfort and air quality throughout the building. In this way, it not only meets the technical goal of recovering energy—it actively supports a healthier, more comfortable home environment.
An Example of Centralised Heat Recovery Ventilation In Australia – The Fanco Habitat Central
To give a clearer picture of how a centralised heat recovery ventilation system works in practice, consider the Fanco Habitat Central HRV—a model we supply nationally and one that sits at the upper end of industry performance. With a regenerating heat- and humidity-recovery efficiency of up to 92% (compared to many basic cross-flow systems that struggle to reach 70%), it’s a good example of how modern HRVs can dramatically reduce energy loss while maintaining year-round comfort. Its dual-motor, counter-flow design keeps air supply and extraction perfectly balanced, avoiding the draughts and pressure imbalances that can occur with simpler setups.
Decentralised (or single-room) heat recovery works on the same principle as a centralised HRV system—delivering fresh, filtered air while retaining valuable warmth—but it does so on a smaller, room-by-room scale.
Instead of servicing an entire home from one main unit, a decentralised HRV like the Fanco Habitat is installed directly into the space it ventilates. This means that compared to a centralised system, the decentralised unit doesn’t need a lot of space making it ideal for targeted applications such as bedrooms, home offices, or living areas where improving air quality and reducing condensation is a priority.
The Habitat perates in short, automated cycles which automatically switch over during operation. On the first cycle, it draws out the stale air and moisture from inside the property. As the air passes through the unit, the unit retains the air’s heat. By operating in cycles, a small unit is able to facilitate air exchange without mixing the incoming and outgoing air streams. Once it switches to the second cycle, it then transfers the heat to incoming fresh air. Decentralised heat recovery is a fantastic option for renovations or retrofits, especially for small or older dwellings, because they need less space. Installing several units throughout the property will create a similar outcome to a centralised system. To get the best use out of decentralised heat recovery, you will still need to seal the space your are working on to prevent air leakage. In the first cycle, it extracts stale, moisture-laden air from the room, capturing the heat within a ceramic core.
Compared to a centralised HRV, which provides consistent, whole-home ventilation through a ducted network, a single-room unit is simpler to install and requires far less space—making it an excellent choice for retrofits, renovations, or older homes where ducting is impractical. Multiple units can be installed in different rooms to replicate whole-home coverage, though centralised systems tend to offer more seamless airflow management. When properly paired with a well-sealed building envelope, the Habitat Single Room offers a cost-effective and efficient way to enjoy the health, comfort, and energy-saving benefits of heat recovery ventilation without the complexity of a full centralised setup.
The Habitat Series excels in targeted ventilation scenarios—such as a bedroom prone to condensation, a home office with elevated CO₂ levels, or a kitchen or bathroom that needs humidity control without losing valuable warmth. Its ceramic core offers up to 95% heat recovery efficiency, allowing it to provide fresh, filtered air while preserving comfort even in winter. With an integrated humidity sensor and adjustable timer settings, it can automatically ramp up ventilation in response to moisture spikes, reducing the risk of mould growth in wet areas.
For homes that don’t require full-house coverage—or where budget, layout, or structural constraints make a centralised system impractical—multiple Habitat Series units can be installed in different rooms to create a modular, whole-home solution. This approach can be particularly effective in multi-storey townhouses, secondary dwellings, or partial renovations, where different zones can be ventilated independently. The result is flexible, energy-efficient ventilation tailored to the spaces that need it most, without the scale, cost, or complexity of a centralised HRV.
An Example of Decentralised Heat Recovery Ventilation In Australia – The Fanco Habitat
For smaller homes, apartments, or individual problem areas, the Fanco Habitat Series decentralised heat recovery unit offers an efficient alternative to a full centralised system. Its compact, through-wall design requires no ducting, making it ideal for retrofits in older properties, strata apartments, or heritage buildings where space and access are limited. Unlike centralised systems that require a dedicated plant space and duct network, the Habitat Series can be installed directly into the wall of the room it serves, keeping installation simple and disruption to a minimum.
Is an HRV system right for your home or business?
Figuring out if a HRV is right for you:
Before you start deciding on which HRV to get, you need to assess if your space is suited for a HRV. HRV’s are at their best when they are in airtight, stable and secure structures. Things like poor insulation, non-airtight rooms, or limited access too the site may make your space unsuited for a HRV at this time, and you may find greater value from addressing these smaller concerns first.
Is your space ready for a HRV?
| Checklist & Question | Yes – Good Fit for HRV | No – Work Likely Needed First |
|---|---|---|
| Insulation quality | Walls/roof well insulated; minimal heat loss. | Poor insulation. Upgrade insulation to improve performance and comfort. |
| Airtightness & draughts | Building is well sealed with few (or no) noticeable leaks. | Gaps/cracks or leaky windows/doors. Seal the envelope before investing in HRV. |
| Condensation & moisture issues | Bathrooms, kitchens, or bedrooms would benefit from controlled ventilation and humidity management. | Moisture problems caused by obvious water ingress or major envelope failures—fix these first. |
| Health & comfort priorities | Desire for fresh, filtered air and stable indoor comfort year-round. | Natural ventilation currently adequate and comfort not a priority (note: efficiency gains may still be missed). |
| Project type & access | New build or retrofit with reasonable access for installation. | Limited access (e.g., heritage/solid walls). Consider decentralised units or enable access first. |
| Coverage goal | Whole-home, consistent ventilation – consider a centralised HRV. | Targeted rooms/zones only – consider decentralised units. |
| Space for equipment | Room for an air handling unit and duct network (centralised). | No plant space/duct routes available – through-wall decentralised units are more practical. |
| Budget & staging | Budget for one integrated system now. | Prefer staged investment – add decentralised units room-by-room. |
Tip: If your answers skew “No,” start with insulation and airtightness upgrades. Once the envelope is improved, HRV can efficiently deliver fresh air, reduce condensation, and maintain comfort.
Factors that Reduce HRV effectiveness in more depth:
What makes HRV’s not work well
Choosing between Centralised or Decentralised Heat Recovery Ventilation
Still need help deciding which Heat Recovery Ventilation System is right for you? Expand this guide:
HRV Decision Flow – Click to Expand/Collapse ▶
Step 1: Is your building well insulated and relatively airtight?
Step 2: Do you want consistent, whole-home ventilation from one system?
Step 3: Do you have space for ducting and an air handling unit?
Step 4: Are your needs targeted (e.g., bedroom condensation, bathroom humidity)?
Choose Centralised HRV when:
- New build or deep retrofit; good insulation & airtightness.
- Even, whole-home ventilation and central controls desired.
- Space available for ducting and an air handling unit.
- Budget allows for a higher upfront investment.
Choose Decentralised HRV when:
- Renovations, apartments, heritage/solid-wall homes with limited access.
- Targeted problem areas (bedroom condensation, bathroom humidity).
- No plant space/duct routes; prefer staged, room-by-room investment.
- Budget requires a lower initial cost with option to expand later.
Need Further Guidance?
If you are in the process of making your building energy efficient, or have queries about the information presented in this article today then our team are available for consultation. Our team has much experience and knowledge of modern HRV systems, and are always avaliable to help guide you through the process of figuring out which type of HRV is for you.
We also take enquiries for new builds.
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