Hot water systems are one of those things in our homes that we take for granted until hot water stops coming out of the taps…… and that’s fair enough. For the most part, hot water systems are hard-wearing, long-lasting and (mostly) hidden from view.

Hot water shower with steam

But hot water systems also account for between 20% – 30% of all household energy use, depending on the size of your household. That means that when it comes to planning for a new one as part of a regular upgrade/maintenance plan, or having to replace one because something has gone wrong, you need to have the best information to make the right choice.

Here are two examples that illustrate how making considered decisions has made a real difference to households:

Scenario 1

Previous situation: This is a four-person household with a 250-litre hot water unit. They have PV solar panels with a 50 cent feed-in tariff. They use 75 litres of hot water per person per day, and they are charged on Tariff 33 @ 25 cents/KW hour. Their hot water cost was 37.5 cents/KW Hour
= $1780 per year

Our suggestion: Install a 400-litre Rheem 12 year warranty hot water system, and switch to tariff 31 @ 15 cents/KW hour. Their annual hot water cost is reduced to just $712.50. If the hot water system last 20 years that’s a power saving of over $21000:00

Scenario 2

Previous situation: A family of four had a Solar PV 10 cent feed on Tariff 33. Their hot water cost was 17.5 cents/KW hour, resulting in an annual bill of $831.00.

Our suggestion: Install a larger system with a timer, so it runs during the day off the PV panels. The new cost of power is 10 cents/KW hour, and the new annual cost is just $475.00. Over the possible 15-year life span of the unit, the family will save around $5342.

So, it’s clear there are many variables to consider when choosing the best hot water system.

The Make and Model

When we’re buying a new car, the make and model are the two big choices we make. It’s like that with hot water systems. The major choices are between the types of heating method: gas, solar, electric or a heat pump. The major pros and cons are listed below.


The major benefit of an electric system is that it is generally quite cheap to purchase, and is common throughout Australia, which brings down installation costs. However, on the flipside, electric hot water systems are the most expensive to run if not sized correctly and connected to the best tariff option

Eletric hot warer

In urban areas, off-peak electricity supply, which is cheaper, coupled with a larger hot water tank to keep larger volumes of water warm for longer periods, can help lower the cost. These systems can be installed either indoors or outdoors.


Because of a variety of rebates, feed-in tariffs, government incentives, and the plunging cost of the cells, solar hot water systems are now a common sight throughout the country. The benefits of solar are obviously the lessened environmental impact, as well as the cost savings that come from not having to continuously draw on the power grid to heat water.

Solar panels

The drawbacks are also well-known. In sunny Queensland or northern New South Wales, solar is a great option because the sun shines all year round. However, in cloudy Victoria or Hobart in winter, solar alone may not be a great option. That’s why most solar systems are supplemented by gas or electric “boosters” to cover for stretches when the sun isn’t out.

Compared to the other options, the upfront cost of solar is higher, but the long-term running cost is much lower, particularly here in sunny Queensland.


Gas is a close cousin of electric when it comes to hot water systems. Water quicker or continuously isn’t subject to the same peak/off-peak price variations as electric. Unlike solar, some gas units can also heat water “as needed” and don’t rely on other factors.

Gas electric heaters

However, gas systems are not available to all households because the connections required are not installed in every home. Liquid Petroleum Gas (LPG) sourced from large portable bottles are an alternative, but the costs of these can be very high for running a hot water system.

Other Things to Think About

Other things to think about with a new hot water system include: the age of the current system, how many people live in the home, what the government incentives are (for solar) and how long you intend to stay in the home. For example, a household with three young children and homeowners who intend to stay there for at least the next 7-10 years would be better served by a solar hot water system, as they could recoup the upfront costs over the long term.

On the other hand, a household of two with no kids at home, no pool, and where the owners intend to downsize in the near future, electric or gas may be a better option.

The size of the tank you need, the approximate hot water consumption per person and the local requirements are all something an experienced plumber can help you with so that when you invest in a new hot water system, you are making the best choice for your individual situation.

Once you have your new system in place, you can do a lot to extend the life of your hot water tank. This will prevent the added expense of an unplanned hot water failure in the future.

We invite you to give our friendly Salmon Plumbing team a call today to help you with your decision (07) 3862 2600.