A Smart Buyer’s Guide to Choosing Hot Water Systems

The humble hot-water system has a tendency to fly below the radar – we don’t often give much attention to it until something goes wrong, then you are faced with a catastrophe. Having a cold shower to start the day is the best way said no one ever. Breakdown of the system leads to an emergency replacement wherein you don’t have the time to research the best option. Big and expensive decisions are made hastily.


To avoid a buyer’s remorse, a little education will save you time and dollars in the long term. An excellent hot water systems should last ten years according to Henry Fudge of Bunnings Warehouse. It is worth the time and effort to research the most appropriate system that will last long without compromising efficiency. Here’s a summary on the knowledge you need to arm yourself with before making a considered choice:




Electric hot water systems are readily available, they can be found at your local dealers and plumbing stores. These systems normally have the highest running costs compared to other options. Initial outlay is cheaper especially if you are replacing an electric system as installation is not complicated.


It has some advantage if you can access an off-peak tariff, so check with your electricity provider. However, that advantage diminishes if your household has high water consumption which requires the system to run even during off peak periods.


One great alternative to electric system is a heat-pump hot-water system, a more energy-efficient electric option. Mark Padwick of Sanden Hot Water says these products generate heat “by running like an air-conditioner in reverse”. Mark points out that with the Sanden Eco heat pump you can save up to 80 per cent on the cost of hot water using a heat-pump system versus a conventional electric storage system.


Heat pumps can also be configured to utilise solar power if you have existing PV panels which further makes the running cost lower if not free. Sanden Eco heat pump system uses a unique refrigerant (CO2) which is a game changer and makes the Sanden the most advanced, clean, sustainable and efficient hot water system to run on the market today.



Gas is generally cheaper for initial cost and often a good option for continuous-flow systems. However, it is only effective if you have piped natural gas available on your property, which is common in Victoria, Adelaide, Perth, Canberra and metropolitan NSW. Rural parts of Australia have limited availability, so again check with your provider. LPG gas or bottled gas is also used to heat hot water, but costs about three times more than natural gas, and is usually only used where there is no natural variety available. Gas prices are also rising yearly so these systems end up costing more to run in the long term and over its life.



Solar hot water Majority of solar hot water systems have either a gas or electric booster – or even a heat-pump system – to ensure hot water, stored in an insulated tank, is always available. Solar hot water systems are much more expensive to install and are more common with new builds or people looking to make their home greener, according to Patrick Hooper from Rinai. “You do save money over time, as despite a higher initial cost and install price, your running costs are fairly low,” says Patrick. Solar-powered systems work better in some parts of Australia, particularly Queensland and the Northern Territory. In Southern Australia or some parts of Victoria “you may need to rely on your booster a little more at certain times of year.” One disadvantage of the system is the maintenance required especially if the tank has sacrificial anodes which might need replacing.





Storage: “The most common type of hot-water system in Australia are Storage heaters,” says Henry. These systems work the same way as an electric kettle, using either a gas or electric element to heat the water and store it for future use. Many people opt for a storage unit because it’s what they are familiar with – bearing in mind it’s usually an on-the-spot decision – and will simply replace their old unit with a new version. They work well if you use off-peak tariffs only, ensuring that you purchase energy at the lowest possible rate. They’re often cheaper to install.


However, storage units can be costlier to operate, can run out of hot water and take a while to heat water. They come in different sizes, but know that they heat the whole tank, so make sure you choose the right size for your needs, so energy is not wasted.


Continuous flow:  Almost all major hot-water system manufacturers now offer continuous-flow systems, which are small, instantaneous and has a steady supply of hot water. They take up far less room than most storage units – “just a little box that sits on the wall,” says Patrick, and can even be recessed into the wall. These are appropriate for small dwellings such as apartments with low occupancy. Unlike storage units, they only turn on when needed, which means they don’t waste energy when not in use. They’re also good if you have fluctuating demand – frequent visitors or a family with kids.


Choose the right flow rate for the number of outlets – if you have two or more bathrooms you may want to have a higher flow unit, keeping in mind that a normal showerhead runs at about nine litres per minute. Continuous flow units however can be more costly to operate in the long run if you have a bigger household and uses more at different times of day when you cannot restrict the operation to run during off peak periods.


It is worthy to remember that these hot-water systems require different connections to storage units and also need access to a powerpoint for the electric ignition – so if you are planning on changing systems, there may be additional installation costs.


*Rebates for solar hot water – Sanden Eco heat pump offer the highest rebates amongst the hot water systems. Check with state authorities for more info.  Check your available rebates at http://www.newgensolar.com.au/rebate-calculator





  • Are you licensed? Use a licensed plumber for installation. You can double-check tradies’ details online at licensedtrades.com.au.


  • Are you an accredited installer of my chosen product? Your plumber needs to be experienced in installing the selected system and have accredited training by the manufacturer.


  • Where is the best place to install it? Units are more efficient when located next to the kitchen and/or bathroom. There’ll be a delay if you put the system away from point of use


  • What can I expect to pay? Always get a quote prior to installation.


Adapted from:


By Lynne Testoni