Victoria's water consumption has been slashed almost 30% since the nirtoduction of government rebates for installing rainwater tanks and water-saving devices.

Water Minister Tim Holding said today that more than 19,000 households across the state had installed a rainwater tank since January 2003.

The program had resulted in a saving of about 1.5 billion litres of drinking water, or about 28%, he said.

"Rainwater tanks are an excellent way to save water around the home as well as providing a solution to water restrictions," Mr Holding said.

"There are no restrictions on the use of rainwater in Victoria, which means this water can be used for a range of purposes, including keeping gardens healthy and for washing cars."

Under the state's Water Smart Gardens and Homes Rebate Scheme households are eligible for a maximum rebate of $1000 for installing a 5000-litre or larger rainwater tank connected to the toilet and laundry.

The Government has provided more than 186,000 rebates to households on water-saving products like tanks, mulch and water-efficient shower heads since January 2003.

"This is a significant incentive for people to purchase a rainwater tank and have it plumbed for use inside the home, which means it can be used all year round," he said.

"By changing our water-use habits and fitting our homes and gardens with water-efficient products we are helping to secure our water for now and for the future.

"In Melbourne, the rebates program has helped slash per capita water consumption by around 28% compared with water use in the mid-1990s."

The rebate scheme will run until June 30, 2009.

 Source: AAP