Hot water - Save on running costs with gas or solar hot water systems

Save on running costs with high efficiency gas or solar hot water systems. Buy a gas hot water system with at least 5 stars.

In Victoria, hot water accounts for around 20% of household energy use. A high efficiency gas hot water system is one of the most economical types of water heaters when operated on natural gas. The cheapest and most environmentally friendly type of water heating to run is natural gas-boosted solar.

Hot water system types
There are two basic types of hot water systems:

  • Storage water is heated and stored in an insulated tank for use when required.
  • Instantaneous (or continuous flow) heats the water only when it’s required. A storage tank isn’t needed.

Energy Source Type Energy Rating Annual Cost*
Small 1–2 people/100 litres per day Natural Gas Storage  
Natural Gas Storage ★★★   $275  
★★★★★   $219  
Instant   ★★★★   $198  
★★★★★★   $162  
Electricity   Storage – P tariff   N/A    $682  
Instant – P tariff   N/A    $535  
Storage – OP tariff   N/A    $508  
Solar  Natural gas boosted+ N/A    $91  
Electric boosted – OP tariff+  N/A $194
Medium 3–4 people/200 litres per day 
Natural Gas Storage   ★★★ $436
★★★★★  $362  
Instant   ★★★  $395  
★★★★★★  $324  
Electricity   Storage – P tariff   N/A    $1337  
Instant – P tariff   N/A    $1070  
Storage – OP tariff   N/A    $859  
Solar  Natural gas boosted+   N/A    $158  
Electric boosted – OP tariff+   N/A   $293
Large 5+ people/250 litres per day 
Natural Gas Storage ★★★ $516
★★★★★   $ 434  
Instant   ★★★   $ 494  
  ★★★★★★   $ 406  
Electricity   Storage – P tariff   N/A    $ 1,609  
Instant – P tariff   N/A    $ 1,337  
Storage – OP tariff   N/A    $ 1035  
Solar   Natural gas boosted+   N/A    $209  
Electric boosted – OP tariff+   N/A    $399  

Compare star ratings

  • For gas, use the energy rating label to find the most efficient hot water system to suit your needs.
  • To further compare models refer to the energy consumption number on the label.

Buy to save in the long run

  • Buy a gas hot water system with at least 5 stars, every extra star will save you money.
  • Choose the right sized system for your hot water needs in consultation with your hot water specialist.

Maximise efficiency

  • Install the system close to your hot water outlets and use closed-cell rubber insulation on pipes.
  • For instantaneous systems choose electronic ignition instead of a continuous pilot light to reduce gas consumption.
  • Keep your shower under four minutes and make further savings.