Gas, electric or heat pump? Choosing your next hot water system

Most people buy a hot water system twice in their life, usually in a panic, usually before their first coffee. The panic buy is almost always a like-for-like swap — which means many Sydney homes are still paying electric-storage running costs that a modern system would halve.

The four contenders

• +Electric storage — cheapest to buy, dearest to run. Makes sense for granny flats and low-use homes.
• +Gas continuous flow — endless hot water and good running costs if you're already on gas, with a compact wall-mounted footprint.
• +Heat pump — cheapest to run, uses around a third of the electricity of a storage tank, and NSW incentives cut the upfront cost substantially.
• +Solar with boost — excellent running costs but the highest install cost and roof-dependent; often beaten on value by a heat pump plus solar PV.

What we'd put in our own homes

For most Sydney families in 2026: a heat pump if you have anywhere sensible to put one, gas continuous flow if you're on gas and short on space, and electric storage only where budget or placement rules everything else out. Whatever you choose, size it from your actual household — our hot water team calculates from bathrooms and usage patterns, not from whatever's on special.

Don't skip the rebate

NSW energy-saving certificates knock a meaningful amount off heat pump installs, but claiming them involves accredited installers and paperwork. We apply the discount directly on the invoice so you get it at purchase time, not as a claim-back six weeks later.