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  • Hot water system

    The Ultimate Hot Water System Buying Guide



February 2018


What you need to know when shopping for the best hot water system for your home.

Usually, we only learn to appreciate our hot water system when it fails... and it’s time to buy a new one. When that time comes, modern invention spoils us for choice. Today, you can choose from three main options, including:

  • a gas hot water system
  • an electric hot water system
  • and an instant hot water system

Which is the best hot water system for your home?

Choosing the best hot water system for your home depends on various factors. Apart from your budget, you might also consider how your choice relates to energy consumption. Second to space heating and cooling, water heating is the largest source of energy use. It is also the main source of greenhouse gas emissions in the average Australian home.

Although less than half of Australian homes use electric water heaters, they still contribute to 80% of hot water greenhouse emissions. The other homes in Australia use natural gas (48%), solar energy (4%) and liquefied petroleum gas (4%) for water heating. 1

Hot water system buying considerations

When it comes to choosing the best hot water system for your home, try not to be too hasty. Instead, weigh up the pros and cons of each system, along with your specific requirements, including:

Gas hot water systems

It is generally accepted that gas is an efficient energy source, so if you have a natural gas connection, that may be a good option. Unlike LP gas, natural gas should never run out while you’re in the shower, and it is also cheaper than LPG. 2

You may be able to choose between a gas pilot light and electric ignition option on your hot water system. The pilot light only uses a negligible amount of gas, while the electric ignition is more economical. But, you can lose your hot water supply during a blackout with the electric ignition option.

The size of your holding tank will depend on the size of your household. However, instantaneous systems provide almost instant hot water while saving space. There is no tank, which is great for small apartments.

Gas hot water systems have energy efficiency star ratings, so choose the one with the highest rating you can afford. 3

Solar hot water systems

In order for a solar hot water system to be efficient, it needs to be installed in the sunniest spot. You may want to consider buying a larger tank for less sunny days or increased hot water use. Most solar systems are equipped with a gas or electric booster element to maintain heat on less sunny days.

Over time, the low running costs of a well-chosen solar hot water system should make up for the time-consuming and comparatively expensive installation costs. A solar water system may provide as much as 90% of your hot water needs for free, without any greenhouse gas emissions. 4

Electric hot water system

An electric hot water system is usually relatively cheap to buy and install. However, it can be expensive to run on a continuous rate. If your meter is configured to include off-peak rates, it should work out cheaper. Off-peak electricity rates are cheaper than peak rates. The water will be heated overnight, but you will probably need a bigger tank to make your hot water last all day. 5

You may also opt for an electric instant heat system.

Best hot water system for energy saving

Depending on your bathroom, laundry, and general household hot water needs, an instant hot water system might be the best option in terms of energy saving. Here’s why:

  • You can choose an electric or gas instant hot water system.
  • An instant hot water system only heats the water you need when you need it.
  • Since no hot water is stored in a tank, there is no heat loss, which tends to make it a cheaper option than hot water storage systems.
  • Although electric instant hot water systems use the full electricity tariff when they are in use, it should still work out cheaper than a continuous hot water system.

Alternatively, consider the benefits of a heat pump hot water system. This alternative uses renewable energy to heat water, and doesn’t require solar panels to function.

The final word

Calculating the size of your hot water heater correctly for your family’s hot water requirements can help you maintain energy-efficiency in your home.

When you’re in the market for a new how water system, look at the energy efficiency ratings on gas hot water systems, and Minimum Energy Performance Standards (MEPS) for electric hot water systems.


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