Compare water heating running costs

Last updated: 4 August 2021

This page provides approximate annual energy costs and greenhouse gas emissions for various types of common water heating system for different household sizes. It also shows the estimated greenhouse gas emissions of the different options over a 10-year period.

This provides a fairer comparison of emissions between systems that use gas and electricity, as over this time the greenhouse intensity of Victoria’s electricity supply will become much lower.

These calculations should be used as a guide only.

Your water heating energy costs will depend on:

  • the number of people in your household
  • how you use hot water
  • your energy tariffs
  • your climate
  • how efficient the system is
  • the length and insulation of connecting pipes.

1 person (60 litres per day)

Gas

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas – storage 5.3 $165 540 5.4
Natural gas – storage 4 $190 630 6.3
Natural gas – instant 7 $115 375 3.5
Natural gas – instant 6 $120 405 3.8
LPG – storage 5.3 $390 635 6.3
LPG – storage 4 $455 735 7.3
LPG – instant 7 $245 425 4.0
LPG – instant 6 $265 465 4.4

Electric

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff – storage N/A $460 1,730 10.4
Peak tariff – instant N/A $325 1,230 7.4
Off-peak tariff – storage N/A $390 2,160 13.0

Solar

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas boosted High efficiency $25 85 0.7
Natural gas boosted Standard $30 105 0.8
Electric boosted – peak tariff High efficiency $95 345 2.1
Electric boosted – peak tariff Standard $150 570 3.4
Electric boosted – off-peak tariff High efficiency $70 390 2.3
Electric boosted – off-peak tariff Standard $115 635 3.8
LPG boosted High efficiency $40 95 0.7
LPG boosted Standard $55 115 0.9

Heat pump

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff High efficiency $125 460 2.8
Peak tariff Standard $195 725 4.4
Off-peak tariff High efficiency $85 460 2.8
Off-peak tariff Standard $135 725 4.4

2 people (90 litres per day)

Gas

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas – storage 5.3 $205 675 6.7
Natural gas – storage 4 $235 775 7.7
Natural gas – instant 7 $160 530 5.1
Natural gas – instant 6 $175 580 5.5
LPG – storage 5.3 $485 790 7.9
LPG – storage 4 $560 905 9.0
LPG – instant 7 $355 610 5.9
LPG – instant 6 $390 665 6.4

Electric

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff – storage N/A $615 2,315 13.9
Peak tariff – instant N/A $485 1,835 11.0
Off-peak tariff – storage N/A $500 2,745 16.5

Solar

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas boosted High efficiency $35 120 1.0
Natural gas boosted Standard $45 150 1.3
Electric boosted – peak High efficiency $150 560 3.4
Electric boosted – peak Standard $225 840 5.0
Electric boosted – off-peak tariff High efficiency $115 620 3.7
Electric boosted – off-peak tariff Standard $170 930 5.6
LPG boosted High efficiency $65 130 1.1
LPG boosted Standard $90 170 1.5

Heat pump

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff High efficiency $160 610 3.6
Peak tariff Standard $255 960 5.8
Off-peak tariff High efficiency $110 605 3.6
Off-peak tariff Standard $175 955 5.8

3 people (120 litres per day)

Gas

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas – storage 5.3 $245 805 8.0
Natural gas – storage 4 $280 915 9.1
Natural gas – instant 7 $210 690 6.6
Natural gas – instant 6 $225 755 7.3
LPG – storage 5.3 $580 940 9.4
LPG – storage 4 $660 1070 10.7
LPG – instant 7 $470 795 7.7
LPG – instant 6 $515 870 8.4

Electric

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff – storage N/A $765 2,900 17.5
Peak tariff – instant N/A $645 2,440 14.7
Off-peak tariff – storage N/A $605 3,330 20.0

Solar

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas boosted High efficiency $50 160 1.4
Natural gas boosted Standard $65 210 1.9
Electric boosted – peak tariff High efficiency $215 810 4.9
Electric boosted – peak tariff Standard $305 1,145 6.9
Electric boosted – off-peak tariff High efficiency $165 885 5.3
Electric boosted – off-peak tariff Standard $230 1,255 7.5
LPG boosted High efficiency $95 180 1.6
LPG boosted Standard $130 235 2.1

Heat pump

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff High efficiency $200 755 4.5
Peak tariff Standard $320 1,200 7.2
Off-peak tariff High efficiency $135 750 4.5
Off-peak tariff Standard $215 1,185 7.1

4 people (150 litres per day)

Gas

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas – storage 5.3 $285 935 9.3
Natural gas – storage 4 $320 1,060 10.6
Natural gas – instant 7 $255 850 8.2
Natural gas – instant 6 $280 925 9.0
LPG – storage 5.3 $675 1,095 10.9
LPG – storage 4 $765 1,240 12.4
LPG – instant 7 $580 980 9.5
LPG – instant 6 $640 1,075 10.4

Electric

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff – storage N/A $920 3,485 21.0
Peak tariff – instant N/A $805 3,045 18.3
Off-peak tariff – storage N/A $710 3,915 23.6

Solar

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Natural gas boosted High efficiency $65 210 1.9
Natural gas boosted Standard $85 280 2.5
Electric boosted – peak tariff High efficiency $290 1,095 6.6
Electric boosted – peak tariff Standard $395 1,480 8.9
Electric boosted – off-peak tariff High efficiency $215 1,190 7.1
Electric boosted – off-peak tariff Standard $290 1,605 9.6
LPG boosted High efficiency $130 235 2.1
LPG boosted Standard $175 315 2.9

Heat pump

Water heater type Energy star rating Annual energy cost Greenhouse Gas emissions 2020 (kg/year) 10 year Greenhouse Gas emissions (tonnes)
Peak tariff High efficiency $240 910 5.5
Peak tariff Standard $380 1,435 8.6
Off-peak tariff High efficiency $160 885 5.3
Off-peak tariff Standard $255 1,400 8.4