Water heating is a significant user of energy. In fact, water heating accounts for the second largest segment of household energy use, after space heating and cooling. More than half of all hot water use is in the bathroom, a third in the laundry and the remainder in the kitchen. Heating water for these activities comprises approximately 25 per cent of household energy use in Australia.

Selecting the right system can have big benefits in terms of household energy costs and meeting household hot water needs – one of life’s essentials. Find out about the types of water heaters you can choose.

We have a downloadable factsheet on the different hot water technologies, and how you can adopt them, as well as a checklist on what to consider when choosing a new hot water system.

For in depth information about a particular type of technology, look at our product profiles under our key documents.

Still can’t find what you need? Read our water heating frequently asked questions.


Hot water technologies regulated for energy efficiency

Electric Storage Water Heaters, Gas Storage Water Heaters and Gas instantaneous water heaters must meet Minimum Energy Performance (MEPS) requirements under GEMS. To find out more about MEPS for water heaters check the relevant Australian GEMS determination or the New Zealand regulations.

Energy efficiency performance requirements are not in place for solar water heaters, heat pump water heaters or electric instantaneous water heaters.

GEMs regulations do not require water heaters sold in Australia to display an Energy Rating Label. The energy label found on gas water heaters is not overseen or administered by the E3 program.


Current Work

The E3 Program regulates hot water heaters for Minimum Energy Performance standards and compliance against those standards.  The program also fosters improved energy efficiency through consumer information, industry capacity building and innovation support.

Guiding objectives for the E3 Hot Water work program are:

  • Develop a unified and comprehensive approach to energy efficiency across hot water technologies
  • Fair, technically sound, and even handed regulation across hot water technologies
  • Provision of reliable and comparable information for consumers and industry
  • Allow meaningful comparisons of energy efficiency across hot water technologies.

Find out more about our current work and how you can contribute your views.

Types of Water Heaters

What are the available technologies in Australia?

If you are building a new house or replacing an existing hot water heater, you can choose from a range of technologies to suit your home, climate, budget and impact on our environment such as greenhouse gas emissions.

There are two basic types of water heaters on the market – storage and instantaneous (continuous) flow systems. They use a variety of energy sources to heat water including solar, ambient air (air-sourced heat pumps), gas (LPG and natural gas) and electricity. Storage water heaters use an insulated tank to store heated water for use when it is required. All energy sources can be used when operating storage water heaters, depending on what type and configuration of water heater you choose. Instantaneous flow systems heat only the water required and do not use a storage tank, as such they do not suffer the heat losses associated with storage systems. Instantaneous systems can operate on electricity or gas (LPG or natural gas).

The chart below shows the estimated penetration of water heaters in Australian households in 2014. There are a number of different technologies used in the market, with different energy sources and differing levels of use.

electric storage 36%, gas storage 24%, instantaneous gas 21%,solar electric boost 10%, solar gas boost 3%, heat pump 3%, instantaneous electric 3%

Product information

The following pages contain detailed information on:


More information

There are many documents relating to water heating products available on this site.
The factsheet, checklist and guides have been developed to help you choose an appropriate hot water system to suit your circumstances. They also give useful tips on how to most efficiently operate the system to maximise your economic and environmental benefits.

Also, remember it’s always a good idea to do your research and obtain several quotes before making a final decision.
For even more practical information on how to save energy and money go to yourenergysavings.gov.au.

At a glance...





New Zealand

Electric Storage Water Heaters



GEMS Determination


Instantaneous Electric Water Heaters





Gas Storage Water Heaters


Labelled by industry group

GEMS Determination


Instantaneous Gas Water Heaters


Labelled by industry group

GEMS Determination


Solar Water Heaters

Under Consideration

Heat Pump Water Heaters

Under Consideration

Current Hot Water Work

Combined Hot Water Technologies Consultation Regulatory Impact Statement

A new combined hot water heaters Consultation Regulation Impact Statement (RIS) is planned for release and consultation mid-2016 to draw together and finalise activity across residential Solar, Heat Pump and Electric hot water technologies.

The Consultation RIS will draw on the analysis and consultations completed earlier for electric storage, heat pump and solar hot water systems as well as new proposals relating to energy efficiency labelling for hot water systems. Specific supporting projects include:

  • A Technical Paper is scheduled for release and consultation in late 2015.  The Technical Paper will bring together existing work and present the overall framework and key elements proposed to draw hot water technologies together. 


Zoned Energy Rating Label

E3 is examining the introduction of a zoned energy rating label (ZERL) for residential water heaters.

A zoned label allows a consumer or advisor (such as a plumber) to compare all of the options across the different water heating product types.

This is needed due to the significant impact that the climate at the installed location has on the efficiency of some product types (e.g. air conditioners and solar/heat pump water heaters) and their operating hours (e.g. hotter climates require more cooling).  

Applying a zoned energy rating label to other product categories that are not significantly affected by their installed location is necessary to allow this whole of market comparison (e.g. electric/gas water heaters compared to solar/heat pump water heaters).

  • A zoned map for air conditioners heat pump water heaters has been developed.  Work is continuing to refine the content of the ZERL for water heaters.
  • Consultation on a Zoned Map for Solar Water Heaters (SWH) is planned to start in Spring 2015.   A Research Report setting out the methodology and technical elements for a Solar Hot Water ZERL is under development. Consultation will focus on the feasibility and robustness of the technical elements of the proposed approach. 
  • Consultation on the ZERL for climate affected appliances generally and inclusion of other water heating technologies is planned to start in Spring 2015.

Find out more about the zoned energy rating label


Investigation of current load profile and load sizes

Investigations undertaken by E3 indicate a range of research identifying differences in the hot water load sizes and draw-down profiles compared to that used in Australian Standards.

  • An investigation and review of hot water load sizes and draw-down profiles that reflect Australian and New Zealand usage patterns is planned to commence in Spring 2015. 
  • Consultations on the findings of this investigation are planned for late 2015 and will consider any implications for broader reform proposals for hot water heater energy efficiency proposals.


Enabling compliance with energy efficiency performance claims

Robust, repeatable, and independent “check testing” of appliances’ energy performance is a key feature of the GEMs compliance regime. 

  • A working group, led by the government of Victoria on behalf of E3 is finalising revisions to the method of test for energy performance relevant to residential Gas Water Heaters. 
  • E3 plans to establish an expert technical group to assist in the development of test methods to support cross technology energy efficiency labelling and performance testing.

Zoned Energy Rating Label

Zone based energy efficiency labelling map

Zoned Energy Rating Label

The energy efficiency and performance of a certain appliances can be impacted by where it is installed (location) and other factors such as usage patterns and climate variations, including air temperature, water temperature, frosting, humidity and cloud cover.  The E3 Committee is examining a move to a zone based energy efficiency labelling system for some products or product categories.

Water Heating FAQs

For electric hot water systems, the capacity (called the ’hot water delivery‘) is a measure of the storage and is defined as the volume of water that can be delivered by the tank while maintaining the temperature within 12°C of the initial delivery temperature. This volume is relevant to storage water heaters (gas and electric) where the element rating is very much lower than the rate of energy delivered in the form of hot water. For large electric tanks, which are usually run on off-peak tariffs, this is a reasonable measure of the total hot water that can be delivered in a day. Note however, many utilities offer a tariff which allows boosting through a top element at off-peak rates if certain sizing requirements for the off-peak tank are met (typical > X litres for a Y bedroom house).For smaller electric tanks, which are typically run on continuous electric tariffs, the capacity is the amount of water that can be drawn off in a single sitting. Clearly, the recharge period depends on the element rating and the tank size, but is typically around an hour for smaller tanks.

For gas storage water heaters, the tank storage capacity is a (very approximate) measure of the volume of hot water that can be drawn off in a single sitting. The recovery time depends on the rated burner capacity, but would typically be 1 to 3 hours.

Gas instantaneous (also called continuous flow) and electric instantaneous can supply hot water as long as there is gas/electricity available. Note that these units typically require very high power inputs. Electric units are fairly rare and almost always require three phase power.

A booster will provide additional hot water needs should there be insufficient energy from the sun to heat the water to the required temperature. If you, however, want to reduce your consumption of energy used you may have to be mindful of choosing the right Solar Water Heater or Heat Pump Water Heater with the right tank size for you and your family.

A booster is a back-up heater which uses an alternative source of energy for times when there is insufficient energy from the sun to heat the water to the required temperature. Generally this source of energy is either electricity of gas.

An in-tank boosting unit should ideally only activate when the water temperature is below the thermostat setting and should turn off when the desired temperature is reached. A manual booster switch can be used to maximise solar contribution.

Make sure you discuss your tariff options with your installer before the installation of your unit to ensure you have a good understanding of how different tariffs will affect both its running costs and performance.

Generally, be aware that some low-emission water heaters are less suitable for off-peak tariffs. The following water heaters are better suited to continuous/day rate electric supply:

  • Instantaneous gas systems that require electricity to ignite the burner

  • Solar systems with a circulation pump or some gas boosts that require electricity for burner ignition

  • Some heat pumps – especially in colder climates where the pump will need to operate during the day

To gain a better understanding of your tariff options, you should talk to your electricity supplier.

Many models of solar are suitable to run on off-peak power. However, you should be aware that if you don’t use a lot of water in the mornings, operating your boost on off-peak can mean you have a full hot tank in the morning, meaning your solar collectors will be less able to make use of the sun’s contribution during the day.

Some heat pumps may also be suitable to run on off-peak power but you should talk to your supplier before you decide on a model. If you live in a climate with cold overnight temperatures be aware that the heat pump will have to work a lot harder to heat your water than during the day when temperatures are warmer.

In either case you should research your options and speak with suppliers before you make any final decisions.

Look at our checklist for hints of what to consider when buying or installing a water heater.

The main issues you should consider are:

  • Where the heater can be installed

  • The price of the heater (as well as installation, maintenance and running costs)

  • The rebates and other purchase cost assistance applicable to the heater type and to your area

  • The energy source (electricity – for electric storage, instantaneous, heat pump water heaters and solar water heaters with an electric boost,  gas water heaters – natural or LPG,) and its availability

  • Specific issues that require consideration with different heater types – your climate, access to direct sun, shading, layout of your house, etc

As with any large purchase, it’s a good idea to do your own research first and also to discuss your options with a number of suppliers or installers so they can advise on the heaters that may be appropriate for you.  The website Your Energy Savings is also a good source of information.

The efficiency of any unit will depend on a large number of factors so it’s best to do plenty of research, including product reviews on websites, talking to several different retailers and suppliers before making any decisions.

While the majority of the water produced from a solar or heat pump system should be from the sun or warmth from the air respectively, you will also have to account for any boosting that may be required when the hot water supply is insufficient.

A solar hot water system can provide up to 90% of your required hot water, depending on where you live. Have a chat with your supplier to get an idea of the solar gain you can expect in your climate.

Heat pumps work best in warm climates as they can gain more warmth from the air to transfer in to the water. Once temperatures get lower, it becomes more difficult for the heat pump to extract warmth from the air, so they will need to work for longer to produce the same amount of hot water.

The Your Energy Savings website has an abundance of practical tips and information for reducing your hot water usage around the home. Some tips include:

- Install low flow shower heads;

- Fix leaks in pipes;

- Reduce showers to four minutes; and

- Use cold water when washing clothes in a washing machine

You can also search and compare appliances at www.energyrating.gov.au

Storage units are usually sized according to the number of people in the house, and instantaneous units according to the maximum number of hot water outlets likely to be used at the same time. Gas storage systems can have a smaller tank size than electric off-peak systems as they reheat the water whenever it cools down.

The way you use hot water will also impact on the size you should choose. If everyone in the household tends to shower at the same time of day, such as first thing in the morning, you may want a bigger storage tank to ensure you don't run out of hot water. But remember, the bigger the tank the greater the standing heat loss, so aim for the smallest tank that will meet your needs.

The table below gives an indication of what size heater you might need, but you should always ask the supplier or manufacturer for specific size guidelines for the products you are considering.



Number of people

Size (litres)

Number of hot taps used
at the same time

Flow rate
(litres per minute)




















Climate considerations need to be made when sizing and selecting a water heater. Storage heaters are an effective choice for any climate. However, in very cold climates, hot water usage tends to be higher, so it may be worth considering purchasing a larger storage tank than otherwise might be suggested for your household size. If you have the space available, then you could also consider installing the heater indoors, for example in a laundry, to help reduce heat loss from the tank.

In a climate with very cold winters, such as alpine areas, you should choose a system with a higher capacity than is normally recommended for your needs because instantaneous heaters are limited in how much they can increase the temperature of the cold water. They can raise the temperature of the cold water by 25 degrees at their nominal maximum rated flow. Reducing the flow rate will also allow the water to be heated to a higher temperature.

Compare models


Search the Registration database

Use the registration database to view and compare all products that are registered under the GEMS Act.

Registration database

Online Calculator

Compare the energy efficiency of fridges, televisions and computer monitors, clothes washers and dryers, dishwashers, and air conditioners.

Compare models

Mobile App

Download the Energy Rating App to find the running costs of appliances on the go or in store.

Your Energy Savings website


Your Energy Savings website

Visit the Australian Government's Your Energy Savings website for useful information like:


Most recent water heating consultation: