Are heat pump rebates available in Australia?

Yes — most states offer rebates of $800–$1,000+ for heat pump hot water systems. After rebates, a heat pump in Australia costs $2,000–$5,000. Check energy.gov.au for current eligibility.

Should I switch from gas to electric / heat pump?

With rising gas prices, switching to a heat pump often makes financial sense over 5–10 years — especially with government rebates. The upfront cost is higher but running costs are 50–70% lower.

How long does hot water system installation take in Australia?

A like-for-like replacement takes 2–4 hours. Switching fuel types (e.g. gas to heat pump) may take a full day due to additional plumbing and electrical work.

Cost Guide

Hot Water System Cost Australia 2026

Q: How much does a hot water system cost in Australia?

A hot water system in Australia costs $800–$2,500 for electric storage, $1,200–$3,500 for gas storage, $1,500–$3,000 for continuous flow gas, and $3,000–$6,000 for a heat pump (before rebates).

Q: What's the cheapest hot water system to run?

Heat pumps are the cheapest to run ($150–$300/year) followed by solar ($200–$400/year). Electric storage is the most expensive at $500–$1,000/year. Gas sits in the middle at $400–$700/year.

Hot water system costs vary by type — electric, gas, heat pump, or solar. Government rebates can significantly reduce heat pump costs.

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National Pricing Overview

Service	Low	Typical	High
Electric storage (supply + install)	$800installed	$1,500	$2,500
Gas storage (supply + install)	$1,200installed	$2,200	$3,500
Continuous flow gas	$1,500installed	$2,200	$3,000
Heat pump (supply + install)	$3,000installed	$4,200	$6,000
Heat pump (after rebates)	$2,000installed	$3,000	$5,000
Solar hot water	$3,500installed	$5,000	$7,000
Tempering valve install	$150per job	$250	$400
Hot water repair (general)	$150per job	$300	$500
Anode replacement	$200per job	$350	$500
Old system removal + disposal	$100per job	$200	$350
Emergency hot water replacement	$1,500installed	$2,800	$4,500
Running cost (electric, annual)	$500/year	$700	$1,000

Prices verified February 2026 · Cross-referenced against 90+ Australian trade pricing sources · See methodology

National average prices. Select a city above for location-specific pricing.

A hot water system in Australia costs $800–$2,500 for electric storage, $1,200–$3,500 for gas storage, $1,500–$3,000 for continuous flow gas, and $3,000–$6,000 for a heat pump (before rebates). Government rebates can reduce heat pump costs by $800–$1,000+ in most states.

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What Affects Hot Water System Costs in Australia

System type

Electric storage is cheapest upfront ($800–$2,500 in Australia) but most expensive to run. Heat pumps ($3,000–$6,000) cost more upfront but save $300–$500/year in running costs.

Household size

A family of 4 in Australia typically needs a 250–315L storage system or a 26L/min continuous flow unit. Undersizing means running out of hot water; oversizing wastes energy.

Government rebates

Federal and state rebates for heat pumps can reduce costs by $800–$1,000+ in Australia. Check energy.gov.au for current eligibility — rebates change frequently.

Existing infrastructure

Replacing like-for-like (electric for electric, gas for gas) in Australia is cheapest. Switching fuel types may require new gas lines, electrical work, or plumbing modifications.

Location of unit

Indoor vs outdoor, roof vs ground — relocating a hot water system in your Australia home costs $500–$2,000 extra in plumbing and electrical work.

Emergency vs planned

Emergency replacement in Australia costs 10–20% more than planned — you have less time to compare quotes and may need after-hours installation.

How to Save Money on Hot Water System in Australia

Get 3 quotes from licensed Australia plumbers who specialise in hot water — compare both upfront cost AND estimated annual running costs

Check government rebates before choosing a system — heat pump rebates can make them cheaper than gas long-term

Consider future energy costs — electric storage is cheap to buy but expensive to run ($500–$1,000/year)

Ask about the warranty — most systems offer 5–10 years on the tank and 1–2 years on labour in Australia

Replace your system before it fails — emergency replacements cost more and you get less choice

Ask about tempering valve requirements — these are mandatory in most states and cost $150–$400 extra

Frequently Asked Questions

How much does a hot water system cost in Australia?

Electric storage costs $800–$2,500 installed. Gas storage $1,200–$3,500. Continuous flow gas $1,500–$3,000. Heat pumps $3,000–$6,000 before rebates.

What's the cheapest hot water system to run?

Heat pumps are cheapest at $150–$300/year. Solar is $200–$400/year. Gas $400–$700/year. Electric storage is most expensive at $500–$1,000/year.

Are heat pump rebates available?

Yes — most states offer $800–$1,000+ in rebates for heat pump hot water systems. Check energy.gov.au for current eligibility in your state.

How long does a hot water system last?

Electric and gas storage tanks last 8–12 years. Continuous flow systems 15–20 years. Heat pumps 10–15 years. Regular anode checks extend lifespan.

Should I switch from gas to heat pump?

With rising gas prices, heat pumps often make financial sense over 5–10 years — especially with rebates. Running costs are 50–70% lower than gas storage.