Choose a hot water system

Things to consider when choosing a hot water heater.

  • fuel type – electric, gas or solar 
  • system size
  • running costs.

Electric, gas or solar?

Electric hot water systems

Electric storage hot water systems – the most common type in Victoria – heat water with an element in the bottom of the unit and store it in an insulated tank, ready for use throughout the day. Electric hot water systems are the cheapest to buy but the most expensive to run.

Learn more about electric hot water

Gas hot water systems

A high efficiency gas hot water system is one of the most economical types of water heaters, when operated on natural gas. 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 hot water system.

Learn more about gas hot water

Solar hot water systems

A solar hot water system is more expensive to buy and install, but the running costs will be significantly lower. The cheapest and most environmentally friendly type of water heating to run is natural gas-boosted solar.

Learn more about solar hot water

Heat-pump water heaters

A heat-pump water heater uses heat from the surrounding air to heat water in a storage tank. A heat-pump water heater uses much less electricity than an electric storage water heater, but are generally better suited to warmer climates.

Learn more about heat-pumps

Running costs

The type of hot water system you have makes a big difference to your energy bills.

Compare running costs

How to size your hot water heater

A storage heater that is too small will continually run out of hot water, while one that is too large will be more expensive to run because it will maintain the water temperature even when it's not being used.

Similarly, a continuous flow system that's too small may not be able to keep up with your hot water demands when multiple hot water outlets are being used at the same time. Your water heater supplier will be able to help you choose the right-sized system.

  • Storage hot water heaters are sized according to household size. The more people, the larger your storage tank will need to be.
  • Continuous flow or instantaneous systems are sized according to the number of hot water outlets in the home, rather than the number of people.
  • Solar water heaters are sized according to the number of people in the household. The more people, the larger the storage tank and the more solar collectors required.

Replacing an electric hot water heater

If you currently have an electric hot water heater, you could replace it with:

  • a high-efficiency natural gas/LPG continuous flow hot water heater 
  • a high-efficiency natural gas/LPG storage hot water heater 
  • a natural gas/LPG-boosted solar hot water heater 
  • an electric-boosted solar water heater 
  • a heat-pump hot water heater.

Replacing a gas hot water heater

If you currently have a gas hot water heater, you could replace it with:

  • a high-efficiency gas continuous flow water heater
  • a high-efficiency gas storage water heater
  • a gas-boosted solar hot water heater.

Questions to ask your hot water retailer or plumber

When making your decision, it's important to ask your hot water retailer or plumber the right questions.

Government incentives

At various times, government incentives may be available for the purchase of new hot water heaters.

To find find out if there are any incentives available, always ask your Smarter Choice retailer.

A man and a woman shopping for electrical goods

Smarter choice

Energy efficient appliances will save you money. The Smarter Choice retail program will help you make better choices when buying new appliances, hardware and lighting.

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