A hot water system is a major purchase that has to be investigated thoroughly as there are a number of factors to consider.

A water heater is one of your most important home appliances, right up there with heating and cooling, cooking and lighting. When a hot water system fails it tends to happen suddenly and there’s not much time to consider your choices.

Whether it’s an emergency, you’ve decided to make a change or you’re building a new home, it’s difficult to make the right choice if you don’t know what’s on the market and how different hot water systems work.

Let’s take a look at the range of water heaters that are available so that you can choose wisely when the opportunity arises.

What you need to know about hot water systems

First of all, what are the important elements to consider when looking for a hot water heater? The type of hot water system, which will be determined by energy source, your budget, personal needs, the energy efficiency you require and location of the hot water heater.

Tip 1 – Consider the different types of energy

The type of energy source you plan on using will play a big role in determining what kind of hot water system you choose.

The essential choices are electric, gas, solar and heat pump.

  • Electric – An electrically heated storage tank is one of the cheapest to buy and install but is the most expensive to run. Systems that run off-peak are cheaper to operate but off-peak electricity isn’t available to all homes. Electric instantaneous hot water systems are available, but typically only able to supply hot water to one outlet. The unit can be installed indoors or outdoors. Electric hot water heaters range from $400 to beyond $2000, not including installation.
  • Gas – If you have a connection to natural gas this is an excellent option. It is cheaper than electricity (unless you are using solar panels) and gas rates don’t fluctuate throughout the day. Liquid petroleum gas (LPG) is an alternative to natural gas but it’s more expensive and can run out. A gas hot water system is usually installed outdoors but can be installed indoors with a flue. And don’t forget that gas is a fossil fuel. As we move to reduce carbon emissions it may not be the wisest option. Gas hot water systems range from $700 to $2000 and beyond, not including installation.
  • Solar – This is the most energy efficient and cost-effective method, but there are many factors to consider. Solar panels on your roof provide much of your power but need to be installed in the best possible location. The storage tank can be electric or gas boosted to warm water when the sun isn’t out. They are expensive to buy and install but government rebates can offset some of that cost. A solar hot water system can be installed outdoors or indoors and once installed it is highly efficient and cost effective. Solar hot water systems range from $4000 to $8000, not including installation.
  • Heat pump – A heat pump is a more efficient type of electric storage system. It works by extracting heat from the air and using it to heat the water tank. A heat pump system is ideal if you’ve got solar panels. Due to the method of heating, these tend to work most effectively in warmer climates. A heat pump works best in a well-ventilated area and is usually installed outdoors. The compressor can be noisy so it can’t be situated too close to neighbours. Most of these systems are in the $3000 to $4000 range, not including installation.

 Tip 2 – Know the different types of hot water systems

There are essentially two main types of hot water systems – storage tank and continuous (or instantaneous) flow. Let’s take a more detailed look at these two choices.

  • Storage tank – The majority of electric, gas, solar and heat pump hot water systems use a tank. If your household uses a lot of water, this is probably the best option to take. Stainless steel tanks are more expensive but last longer than mild-steel tanks and require less maintenance. These types of hot water systems usually carry a 10-year warranty.
  • Continuous flow – This type of hot water system only heats as much water as you need, when you need it. Most instantaneous models use gas but there are electric units available. These are ideal for smaller households and are cost efficient as no hot water is stored in a tank. But keep in mind that if you use low flow showerheads the hot water may not work because the water flow is insufficient. These systems can last 15 to 20 years with proper maintenance.

Tip 3 – Find out their efficiency

Hot water systems are not required to carry energy star rating labels, according to the Choice website. There are star rating labels on gas hot water systems, but this is managed by the industry, not by the government.

The gas hot water system star rating is not related to the rating labels on appliances such as fridges and air conditioners.

Minimum Energy Performance Standards apply to electric hot water systems, gas hot water storage and instantaneous systems, and are being considered for other types of hot water systems. This could mean inefficient models will be removed from the market in future.

Tip 4 – Consider your personal needs

It’s important to consider the size of your household and how much use the hot water system is going to get.

Remember that the system has to provide hot water for showers, baths and other bathroom needs, the kitchen sink and the laundry. Here are some factors to consider:

  • How many people are in your household?
  • When do you and your family take showers and for how long?
  • Do you use a dishwasher or wash dishes by hand? But remember most dishwashers do not use your hot water system as they heat the water themselves.
  • Do you wash clothes in hot or cold water? Some models only take cold water and heat it themselves, but other models do use your hot water system.

Keep in mind that one person uses about 50L (litres) of water per day. If you’re speaking to hot water system professional, ask them for an approximation of how much water you might need based on the above factors.

A solar hot water system is clearly the most efficient and cost effective to run, but if that’s not an option due to costs or other variables, here’s a quick overview of what you might need:

  • A smaller household (1-2 people) would be suited to a continuous flow (electric or gas) hot water system or a gas storage hot water system.
  • A medium household (3-4 people) would suit a gas system (instantaneous or storage tank) or a heat pump system.
  • A larger household (of 5 or more) would be best suited to a gas storage unit or a large heat pump system.

In conclusion, a lot will depend on the size of your household and what energy source(s) you have access to. The most important thing is to be prepared when selecting your next hot water system – the need to make a decision usually happens when you’re under the pump.

Images: Supplied

This is a sponsored article produced in partnership with Upside Down Plumbing.