How Much Does a Hot Water System Installation Cost?

When it comes to upgrading your home, one of the major considerations is the installation of a new hot water system. Hot water systems are essential for day-to-day living, but the cost of installing a new one can vary significantly. This depends on several factors such as the type of hot water system, location of installation, and any additional plumbing or electrical work required.

Types of Hot Water Systems and Their Costs

There are several types of hot water systems, and each comes with different price tags. Let’s break it down.

Electric Hot Water Systems

Electric hot water systems are generally the cheapest to buy, with prices ranging from $300 to $1,500. However, they can be more expensive to run, which is why many homeowners are now opting for energy-efficient alternatives.

Gas Hot Water Systems

Gas hot water systems, while more expensive to purchase (starting from $900 and reaching up to $2,000), offer lower running costs. They can also heat water faster, making them an excellent choice for large households.

Solar Hot Water Systems

Solar hot water systems, though the most expensive to install (ranging from $2,000 to $7,000), offer significantly lower operating costs and are environmentally friendly. This option can actually save you money in the long run thanks to rebates and reduced energy bills.

Heat Pump Systems

Heat pump systems are another energy-efficient alternative, costing between $2,500 and $4,000. They utilise ambient heat in the atmosphere to warm the water and can significantly reduce your energy consumption.

Hot Water System Installation Costs

The cost of installation varies depending on the complexity of the job, the location, and whether any additional plumbing or electrical work is needed. In general, you can expect to pay between $300 and $1,500 for the installation of your hot water system.

Keep in mind, solar hot water systems typically have higher installation costs due to the need for solar collectors to be installed on the roof. Similarly, heat pump systems might require more space or a specific placement to work optimally.

Other Factors Affecting Hot Water System Installation Cost

If the new hot water system is different from the old one, you might see some additional costs. For instance, if you’re switching from an electric to a gas system, you’ll need to account for the cost of installing a gas line. Similarly, if your home’s existing electrical system is not up to standard, an upgrade might be required, which can increase the total cost.

It’s also worth noting the location of your hot water system can affect the cost. If it’s located in a hard-to-reach area such as an attic or a tight space, the installation might require more time which will increase the hot water system installation cost.


While the upfront cost of installing a new hot water system might seem daunting, it’s essential to consider the long-term benefits. Energy-efficient systems, such as solar and heat pump systems, may require a higher initial investment, but the savings on your energy bills over time and the positive environmental impact make them a cost-effective solution.

When considering a new hot water system, it’s important to do your research and consider both the upfront and ongoing costs. Need some help? Call in the experts!

Looking for expert hot water installation? We’re your 1st Choice!

At 1st Choice Hot Water, we provide expert advice and installation services to ensure you get the best hot water system for your needs and budget. We’re here to help you navigate the process and find the most cost-effective solution for your hot water needs. Shop our hot water systems now!