Hot water running costs

Before making a decision on which hot water system to buy, talk to a retailer about the purchase and running costs, as well as government incentives that may be available.

Choosing between electric, gas and solar

Electric hot water systems are the cheapest to buy, but the most expensive to run. A solar hot water system is more expensive to buy and install, but the running costs will be significantly lower.

Gas and electricity prices are rising, so if you have a conventional gas or electric hot water system that needs replacing, consider a more efficient gas or solar system as an investment against rising costs.

The table below compares the annual running costs for various types of hot water systems for a range of households – a typical household uses around 40–50 litres of hot water per person per day.

Water Heater Type

100L/Day

1-2 people

150L/Day

2-3 people

200L/Day

3-4 people

250L/Day

5+ people

Gas storage - natural gas (5 to 3 Star)*

$219 - $275

$291 - $356

$362 - $436

$434 - $516

Gas instantaneous - natural gas (6 to 4 Star)*

$162 - $198

$243 - $296

$324 - $395

$406 - $494

Gas storage - LPG  (5 to 3 Star)*

$501 - $629

$664 - $813

$828 - $996

$991 - $1,180

Gas instantaneous - LPG (6 to 4 Star)*

$371 - $452

$556 - $678

$742 - $903

$927 - $1,129

 

 

 

 

 

Electric storage - peak tariff

$682

$1,064

$1,337

$1,609

Electric instantaneous - peak tariff

$535

$802

$1,070

$1,337

Electric storage - off peak tariff

$508

$684

$859

$1,035

 

 

 

 

 

Solar/natural gas boosted+

$91

$115

$158

$209

Solar/electric boosted - off peak tariff+

$194

$206

$293

$399

Solar/gas - LPG boosted+

$185

$228

$325

$442

 

 

 

 

 

Heat pump - peak tariff^

$316

$426

$535

$644

Heat pump - off peak tariff^

$203

$274

$344

$414


Based on energy tariffs of: natural gas (1.75 c/MJ), LPG (4 c/MJ), peak electricity (28 c/kWh), off-peak electricity (18 c/kWh).

*All gas hot water systems are star rated – the more stars the more energy efficient they are and the cheaper to run.

+ Based on a 70% solar contribution at rated delivery. Costs of 100 L/day based on unit with small rated delivery, and costs for all other uses based on a unit with a large rated delivery.

^ Based on a 60% solar contribution at rated delivery.

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