How Much Does an Air Conditioning System Cost?

If you’re considering installing a new air conditioning system, one of your first questions is likely: How much is this going to cost me? And the answer isn’t as straightforward as you might hope.

The price of an air conditioning system can range from a few hundred dollars for a small split system to over $10,000 for a fully ducted solution. The final cost depends on several factors, including the type of system, its size, installation complexity, and ongoing running costs.

In this guide, we’ll break down:

By the end, you’ll have a clear understanding of what to budget for and how to ensure you’re getting the best value for your money.

Types of Air Conditioning Systems & Their Costs

When it comes to air conditioning, there isn’t a one-size-fits-all solution. The right system for your home depends on your cooling needs, space, and budget. Below, we’ll break down the cost of aircon installation across different system types.

1. Split System Air Conditioners

Best for: Cooling or heating individual rooms
Split system aircon cost: $550 – $2,500 (unit only)
Split system aircon installation cost: $900 – $3,500 

Split systems are one of the most popular choices for Australian homes. They consist of an indoor unit mounted on a wall and an outdoor compressor. The cost of installing a split system aircon varies depending on the unit’s size and complexity of the installation.

What affects the cost?

• Larger capacity systems (measured in kW) are more expensive but necessary for bigger rooms.
• Multi-split systems, which allow multiple indoor units to be connected to one outdoor unit, increase costs but offer greater flexibility.
• Installation prices vary based on home layout and required electrical work.

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2. Ducted Air Conditioning

Best for: Whole-home cooling and heating
Ducted aircon cost: $7,350 – $20,000+ (unit & installation)

Ducted air conditioning provides seamless temperature control across an entire home. It consists of a central unit connected to ducts that distribute air to different rooms. While the upfront cost of ducted aircon installation is higher, it offers better long-term efficiency for larger homes.

What affects the cost?

• Larger homes require bigger ducted systems, increasing costs.
• Zoning features (allowing different rooms to be cooled separately) can add to the price but improve efficiency.
• Retrofitting ducted aircon in an existing home is more expensive than installing it in a new build.
• Brand of air conditioning system

Key Factors That Affect Pricing

The cost of aircon installation isn’t just about the unit itself. Several factors influence the final price, including system size, brand, energy efficiency, and installation complexity.

1. System Size & Capacity

The size of an air conditioner, measured in kilowatts (kW), impacts both the price of the unit and its installation. 

• Small rooms (10–20m²): 2.5–3.5kW system ($700–$1,500)
• Medium rooms (20–40m²): 4–6kW system ($1,500–$2,500)
• Large open areas (40m²+): 7kW+ system ($2,500–$4,000)

Choosing the wrong size can lead to inefficiency, higher electricity costs and an angry phone call to the company that installed it!

As a rule of thumb, measure the square meterage of the rooms that you want to heat / cool and multiply it by 0.15 (150 watts / m²) to calculate the system size you need.

2. Brand & Quality

Not all air conditioning brands are equal. Premium brands like Daikin, Mitsubishi Heavy, and Actron cost more upfront but offer better performance, durability, and efficiency. Cheaper brands may have a lower price tag but often lead to higher energy bills and maintenance costs over time.

3. Energy Efficiency & Running Costs

Investing in an energy-efficient air conditioner can save you hundreds of dollars in running costs each year. Look for:

• High energy star ratings – More stars mean lower electricity usage.
• Inverter technology – Adjusts power use based on cooling needs.
• Zoning for ducted systems – Allows you to cool only the rooms you need. 

4. Installation Complexity

The cost of aircon installation depends on several factors:

• Distance between indoor and outdoor units – The longer the required piping and cabling, the higher the cost.
• Wall material – Installing brick or multi-storey homes can increase labour costs.
• Electrical work – Older homes may need upgrades to support the system’s power requirements.

For a standard split aircon installation cost, expect to pay between $900–$3,500, while ducted aircon installation costs range from $3,000–$6,000+, depending on the home’s layout.

How to Get the Best Value for Your Money

1. Compare Quotes from Reputable Installers

Not all installers charge the same rates. Some offer low upfront prices but cut corners, leading to inefficiencies and costly repairs later. When comparing quotes, ask:

• What’s included? – Does the price cover installation, warranty, and extras?
• Is the installer licensed? – Always check credentials and reviews.
• Are they offering the right system for your needs? – Some companies push specific brands rather than what’s best for you.

2. Prioritise Energy Efficiency Over the Cheapest Option

A cheap system might seem like a good deal, but an inefficient unit can cost hundreds more in energy bills each year. Opt for:

• A high-star energy rating for lower running costs.
• Inverter technology to adjust power usage.
• Zoning options if choosing a ducted system.

3. Think About Long-Term Costs, Not Just Upfront Price

The cost of installing split system aircon or ducted aircon shouldn’t be your only concern. Consider:

• How much will it cost to run each year?
• Will cheaper brands require costly repairs sooner?
• Is it worth spending more on a system that will last longer?

4. Schedule Regular Servicing

Routine aircon service costs are minimal compared to repair bills from a neglected system. Regular maintenance keeps your system running efficiently and extends its lifespan. Expect to pay $180–$300 per year for professional servicing, but this can prevent much costlier issues down the line.

Next Steps

The cost of aircon installation depends on the system type, brand, installation complexity, and long-term running costs. Whether you choose a split system or ducted aircon, getting the best value means considering more than just the initial price.At Lenergy, we specialise in helping homeowners find the best air conditioning solution for their budget and needs. If you’re ready to install or upgrade your air conditioning, contact us today for expert advice and a tailored quote.