Hot Water System Buyers Guide

Hot water systems continually improve to become more efficient. This is good for the environment and for your wallet. There are several kinds of hot water systems available and each is good in their own way. There are many factors you need to consider when choosing the best system suited for you and your family. 

How to Calculate Hot Water Usage

There are many factors to consider when calculating the amount of hot water your family will use. Amounts will vary depending on your lifestyle and the equipment that you use. You will need to factor in the number of showers and baths you take as well as the number of dishes and clothes you wash.

How Many People Live in the Household? 

The first thing you need to consider is the number of people in your household. Generally larger families will use more water than those who are single. In Australia, the average household is between 2-3 people. As each individual will contribute to the amount of water used, it will be one of the first questions you are asked by a hot water system sales consultant. 

Are You Using Water-Saving Showerheads?

Older, regular showerheads typically use between 15-20 litres of water per minute. A 10-minute shower would average between 150-200 litres per day, 1,050-1,400 litres per week, and 5,475-7,300 litres per year. 

When upgrading to a water-saving showerhead, you can reduce the amount of water used to about 9 litres per minute. This is a little less than ¼-½ of the normal amount used. Strategic planning can help you use even less per shower. Try the following:

  • Shave your legs before you take a shower using a small tub of water. 
  • Store excess water in a bucket while you play with the water temperature. Use the excess to water plants or complete chores around your home. 
  • Upgrade to a temperature-controlled faucet to reduce wasted water.
  • Time your showers to make sure you get out on time.
  • Invest in an energy-efficient hot water system. 

How Many Baths Are Taken in Your Household Per Week?

The average bath in Australia uses just short of 95 litres (when leaving enough room to get in and bathe). This is less than a 10-minute shower with a “normal” shower-head and on-par with a water-saving showerhead. Multiply the number of litres by the number of baths that are taken in your home on a weekly basis. 

Dishwasher vs Washing Dishes By Hand

The University of Bonn conducted a study to determine the average amount of water it takes to wash dishes by hand. It was determined that it took approximately 10.5 litres of water per person. The average Australian household of 2-3 people would use 21-31.5 litres daily. 

An average dishwasher, on the other hand, will use 15 litres of water per cycle. Highly efficient models may even use less (down to 11 litres).
Taking into account the average dishwater usage, Australians use 105 litres washing dishes per week if the machine is used daily. 

Average Amount of Water Used for a Load of Laundry

Using the above numbers, if you have a family of three who shower daily (for 10 minutes each) with a water-saving showerhead and use an efficient dishwasher and washing machine, you will consume approximately 2172.5 litres per week or 9311 litres of water per month. 
In actuality, the average daily amount of hot water used per Australian is 76 litres (due to variances in showers, baths, and amount of chores completed). This translates into 1,596 litres per week and 6,840 litres per month for a family of three.

What Size Hot Water System Do You Need for Your Household?

When shopping for a new hot water system, you should consider the following:

  • The number of people who live in your home
  • Whether or not you wash your dishes by hand or in the machine
  • The temperature of water you use when washing your clothes
  • Time of day when most showers/baths are taken and how often

While the size of the hot water system may vary depending on your specific needs, the average 4-person Australian home will need a 125-160 litre tank for a continuous electric system or a 250-315 litre off-peak system. If you’re in the market for a gas tank, a 4-person house averages a 135-170 litre tank. Solar users will need a 300-360 litre tank (and two solar panels) for a family of four. A 270-315 litre tank should be sufficient for heat-pump users. 

Types of Hot Water Systems

The four major types of hot water systems are electric, gas, solar, and heat pump. Each come with their pros and cons, which will be covered here.

Electric Hot Water Systems

There are two kinds of electric hot water systems: continuous, off-peak, and instantaneous (also known as tankless).

Continuous Hot Water Systems

Continuous hot water systems are one of the most common types of electric systems. As water is used, it heats up more water throughout the day (and keeps it hot) to ensure that your family always has hot water available. 

With continuous hot water systems, you want to try to find the appropriate size for your family. If you get one that is too small, you may constantly be out of warm water. Purchasing one too large will up your electric bill.

Off-Peak Hot Water Systems

Off-peak hot water systems get their name from when the water is heated. Electric companies often charge more kWh during peak hours which typically run from 8 AM through midnight. During the night, the rates drop, and that is when your hot water system gets to work. 

Potentially, you could run out of water when using this system, but these tanks are nearly twice as large as a standard continuous electric system. If you have enough space and don’t mind the risk of running out of heated water before nightfall, this will be the cheapest long-term electric option.

Instantaneous Hot Water Systems

Instantaneous hot water systems (also known as tankless systems) typically have a higher initial cost, but a lower monthly cost. They are very compact and often last longer than tank water heaters. 

Although you will never run out of hot water, you can typically only use it in one area of your house at a time without it going lukewarm. The temperature of the water may also be inconsistent.

Gas Hot Water Systems

Gas hot water systems often have a higher initial price-point over electric systems, but will almost always be cheaper on a monthly basis. You can get a standard take or an instantaneous tank (which will operate much like the electric version). 

Unlike electricity, gas rates don’t fluctuate throughout the day, so your standard tank will be a similar size to a standard electric heater. They are generally installed outdoors to ensure proper ventilation but can be stored indoors with a flue. Some gas systems have a pilot light which will allow you to maintain hot water even in a blackout. These are often a little less economical than models that employ electric ignition.

Solar Hot Water System

Solar hot water systems are powered by the sun’s energy. For this reason, they are often quite large to allow for “extra” water for days when there is less sun (or more showers). You will also need two solar panels to heat the water. 

While the initial costs are quite high, these systems generally pay for themselves in gas and electric savings. You may also qualify for government incentives to help with the purchase. If you aren’t interested in potentially running out of water during a cloudy week, many tanks include a gas or electric booster system that will kick in when the water begins to cool. 

Heat Pump Water System

Although the heat pump is technically an electric system, it operates dar differently. It extracts heat from the air to heat the water in the system, which means they work best in warmer regions. They are generally installed outdoors due to their ventilation needs (and they can be very noisy). Heat pumps are more efficient than standard electric hot water systems.

What is the Most Energy-Efficient Type of Hot Water System?

The most energy-efficient water system depends on the type and size of the system. It can also be based on location, the household size, and a number of other factors.

What Is the Cheapest Type of Hot Water System to Run?

The solar hot water system is generally the cheapest. As it is primarily powered by the sun, very little energy is used in the process. In fact, some Australians are able to sell extra energy back to the state. Your ability to do so would depend on the tariffs in your region. In the event that the initial cost for solar is more than you can afford, look into available hot water rebates. Depending on your location, you can receive rebates or certificates that will greatly discount the initial price. Not only are federal rebates available, but you may also find extra funding through your state. 

If you are unable to use solar (or cannot afford the initial cost even with financial aid), gas is the second choice. Gas is generally cheaper than electricity, though the cost is rising.

How Much Does a Hot Water System Installation Cost?

Installation cost will vary depending on the type of water system, whether or not you are replacing a system or installing on from scratch, and how difficult the job is to complete. 

If you are replacing an existing model with a similar system, costs will generally $675. This includes the four required valves, the QBCC form 4, the electrical requirements and recycling the old system

When moving your system to another area of your home or property, costs will be higher due to extra plumbing and labour. Add $1,100 to $2,100 in these cases. 

If you have chosen to change systems altogether (for example, if you are going to solar from electric), you may need to pay $1,500 to $3,000 depending on the work needed to complete the job.


When making your final choice, it is best to consider your lifestyle, priorities, and how much you can invest in a system upfront. Often, if you can afford a higher initial purchase, you’ll make up for it in saving long before the system needs to be replaced.