A practical guide to selecting the right hot water system based on household size, energy source, running costs and long-term value.
The right system depends on how much hot water your household actually uses. Key factors include:
As a rough guide, electric storage systems need 55–60 litres per person; gas storage systems need 30–40 litres per person (because gas reheats faster).
Each system type has distinct advantages and trade-offs:
Electric Storage: Reliable, simple to install, lower upfront cost. Can heat on off-peak tariffs to reduce running costs. However, electricity rates mean higher long-term operating costs compared to gas or heat pump alternatives.
Gas Storage and Continuous Flow: Faster reheat times, lower greenhouse emissions than electric, and generally lower running costs where natural gas is available. Continuous flow (tankless) systems heat water on demand — no tank, no standby losses, and virtually unlimited hot water. Requires gas connection.
Heat Pump: Uses 60–65% less electricity than conventional electric systems. Eligible for government rebates (STCs). Higher upfront cost but lowest long-term running costs for most households. Best suited to outdoor installation with adequate airflow.
Solar with Electric or Gas Boost: Lowest running costs in sunny conditions. Eligible for significant rebates. Higher installation cost and requires suitable roof space and orientation. A booster (electric or gas) ensures hot water on cloudy days.
This is one of the most important decisions:
Storage tanks heat and store a fixed volume of water. They suit households with predictable usage patterns and off-peak tariff access. Stainless steel tanks last longer and require less maintenance than mild steel. The trade-off is standby heat loss — energy is used to keep stored water hot even when nobody is using it.
Continuous flow systems heat water only when a tap is opened. There is no tank, no standby loss and no limit on consecutive hot water use (within flow rate). They are compact, long-lasting (15–20 years) and efficient. The trade-off is a slightly lower maximum flow rate — running three showers simultaneously may reduce temperature.
Undersizing leads to running out of hot water during peak demand. Oversizing wastes energy heating water that is never used. Use these guidelines:
These are starting points — a licensed plumber will refine the recommendation based on your specific property, climate and usage patterns.
The cheapest system to buy is rarely the cheapest to own. Over a 10–15 year lifespan, running costs typically exceed the purchase price several times over. A heat pump or solar system with a higher upfront cost may save thousands in energy bills over its life compared to a basic electric unit.
Factor in available rebates (STCs for heat pumps and solar can reduce upfront costs by $1,000+), expected energy price increases, maintenance requirements and expected lifespan when comparing total cost of ownership.
Heat pumps and solar systems have the lowest running costs. Heat pumps use 60–65% less electricity than conventional electric systems. Solar is cheapest to run in sunny conditions but requires suitable roof space.
Gas is generally cheaper to run than electric storage where natural gas is available. However, heat pumps (electric) are cheaper to run than gas because they use so much less electricity. The answer depends on your specific tariffs and system type.
As a guide: 55–60L per person for electric storage, 30–40L per person for gas storage. A licensed plumber will assess your specific household demand, peak usage times and property layout to recommend the correct size.
Yes. Heat pumps and solar systems are eligible for federal STC rebates (often $1,000+). Some state programs offer additional incentives. O'Brien can confirm current eligibility during your consultation.
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