Australia · AUD
Hot Water Running Cost Calculator Australia
Estimate electric hot-water running costs, or compare an existing tank with a heat pump. Use your electricity figures and each option's actual tariff, then add installation quotes to see the cost over time.
Worked example: electric storage versus heat pump
These are invented figures to demonstrate the comparison, not measured products or typical running costs. Assume both systems serve the same hot-water demand and the annual electrical input includes their boosters and other modes.
| Input or result | A: electric storage | B: heat pump |
|---|---|---|
| Electrical input | 3,000 kWh/year | 1,000 kWh/year |
| Grid tariff | 20c/kWh | 30c/kWh |
| Net upfront price | A$1,200 | A$3,200 |
| Annual electricity cost | A$600 | A$300 |
| Upfront + 10 years of electricity | A$7,200 | A$6,200 |
B uses two thirds less electricity in this example, but costs only half as much to run because its tariff is higher. Its A$2,000 upfront premium divided by A$300 annual saving gives about 6.67 years simple payback. No solar or additional annual charges are included.
If B instead gets 60% of its 1,000kWh directly from surplus PV that would otherwise earn 6c/kWh, it buys 400kWh at 30c: A$120/year paid for grid electricity. Using 600kWh of solar forgoes A$36 of credit, giving A$156/year modelled running cost. That solar share must come from evidence or an explicit scenario; it is not inferred from system size or daytime operation. This change is separate from the example button's starting figures.
Get a useful energy figure
Tank capacity in litres describes storage, and a power rating in watts describes a load while it operates. Neither establishes annual electricity use. A tank connected all day does not necessarily heat continuously. For a heat pump, distinguish thermal output from electrical input, and include any resistance booster, controls and standby in the energy boundary.
For an existing system, a dedicated hot-water meter or a suitable circuit energy record can provide kWh over an elapsed period. Check that the circuit does not also supply another load. For example, 210kWh over 30 days projects to 2,555kWh over a 365-day year; at 20c/kWh that is A$511/year. A short cold-weather measurement is not a seasonally adjusted forecast. Use a full representative year where available.
For a proposed system, ask for documented annual electrical input for your climate, hot-water demand and operating mode. Your Home explains that COP varies with ambient and initial water temperatures, manufacturers may quote different test conditions, and the heat pump's COP excludes additional booster electricity. Do not simply divide a tank's bill by a marketing COP. An STC count is not your home's annual electricity reading.
Controlled load and time-of-use prices
Use the applicable usage rate on the bill, including GST where charged. Controlled load is a separately managed supply arrangement; it is not automatically the same as a standard time-of-use plan. Check compatibility and available hours with the exact model's documentation. A lower energy estimate on a higher tariff still needs a cost calculation.
If the hot-water energy crosses several price bands, calculate the energy-weighted price for that option: total grid energy charge ÷ grid kWh. Do not divide the entire household bill, including daily supply charges, by kWh and call it an appliance usage price. Our Australian time-of-use comparison can help price known allocations across bands. It does not establish a heater's controlled-load compatibility.
The optional annual-charge field is for a charge attributable to that option. Only count a removed fee as a saving if it actually disappears. A whole-house daily supply charge commonly remains after replacing a water heater. Dynamic or negative prices, demand charges and detailed tariff rules require a fuller bill model.
Rooftop solar and the value of exported electricity
Enter total electrical input from all sources, then the share supplied directly by surplus rooftop PV. Your Home explains that a timer may still draw grid power when there is not enough surplus. Do not treat the timer's share of hours as the solar share of energy, or subtract solar twice from a grid-import-only measurement.
The calculator values that solar at the effective export credit you would otherwise receive. Genuinely curtailed energy can have zero forgone credit. If the electricity would power another appliance, or would be stored in a battery, this simple export-credit assumption does not represent its alternative value. It also does not include buying solar panels, batteries or a diverter.
Compare installation quotes consistently
Enter the net amount payable now, including installation work and only the discounts you can actually claim. Your Home notes that advertised installed prices may already include STCs and state incentives, so do not subtract them twice. Confirm eligibility and the scope of work in the quote.
Keeping an existing tank can be entered as A$0 upfront, but its remaining life is still unknown. Simple payback does not account for future failure, maintenance, replacement, financing or resale. It is one comparison under stated assumptions, not a recommendation to replace a working system.
Calculation method
- Annual kWh = entered annual input, or measured kWh ÷ elapsed days × 365.
- Grid cost = annual kWh × (1 − solar percentage ÷ 100) × grid cents/kWh ÷ 100.
- Forgone solar credit = annual kWh × solar percentage ÷ 100 × effective credit cents/kWh ÷ 100.
- Annual running cost = grid cost + forgone credit + additional annual charges. Monthly average = annual cost ÷ 12.
- Upfront + running cost = net installed price + annual running cost × chosen years.
- Simple payback = extra upfront price ÷ positive annual saving for the more expensive option. With no annual saving, there is no simple payback.
Calculations use unrounded amounts and hold annual energy and prices constant. Missing inputs stay unknown; an intentional zero is allowed. Water, sewerage, gas and solar-thermal energy are excluded. Follow the manufacturer's operating and safety instructions; these cost calculations do not prescribe temperatures, hygiene cycles, wiring or tank size.
Common questions
How much does electric hot water cost to run in Australia?
Multiply the system's annual electrical input in kWh by its applicable cents/kWh rate and divide by 100. For example, an invented 3,000kWh/year at 20c/kWh costs A$600/year before any separate charges. This is not a typical household estimate or national average. Use the hot-water tariff on your bill and include all relevant electrical input.
Will a heat pump always cut my hot-water bill by the same percentage?
No. Compare whole-system electricity at equivalent hot-water demand and climate, including booster and standby, then apply the tariff each system can actually use. A quoted COP depends on test conditions and may exclude the booster. A controlled-load storage tank and a heat pump on a standard tariff can have different prices per kWh, so an energy saving is not automatically the same percentage bill saving.
Can I put a heat-pump water heater on controlled load?
Compatibility and the permitted supply window depend on the exact model and tariff. Your Home notes that some heat pumps are incompatible with controlled load, while others accept only certain types. Check the manufacturer's instructions and your retailer or installer before assuming the old tank's tariff is available to the replacement. Supply hours do not equal compressor or element runtime.
Can I use the hot-water line on my electricity bill?
Yes, if that line measures only the relevant hot-water circuit and you understand its boundary. Choose measured-period mode and enter kWh and elapsed days. The calculator projects a 365-day year. A winter or holiday sample may not represent a full year. If solar also supplies the system, grid imports alone are not its total electrical input; do not apply a solar share to that grid-only figure.
Is hot water powered by rooftop solar free?
Direct surplus PV can reduce grid purchases, but using electricity that would otherwise be exported can forgo a feed-in credit. The calculator shows that credit separately from grid payments. Enter 0 for solar energy that genuinely would have been curtailed. It does not model batteries, export limits over time or electricity diverted from another household load. A daytime timer does not guarantee enough surplus solar.
How do I calculate heat-pump hot-water payback?
Compare net installed prices payable now and annual running costs under consistent assumptions. When the more expensive option has a lower annual cost, simple payback is its extra upfront cost divided by that annual saving. A$2,000 extra divided by A$300/year is about 6.67 years. Financing, future price changes, repairs, replacement and resale are excluded. Check whether rebates are already deducted from the quote.
Does this compare gas or solar-thermal hot water?
This tool compares electrical input. Do not enter gas megajoules, tank litres or solar-thermal heat as electrical kWh. Electric input to a solar-thermal booster can be priced if it is measured and the boundary is clear, but that alone does not establish a whole-system replacement comparison. Water and sewerage charges are excluded.
Should I lower the storage temperature or disable the booster to save?
Do not change hygiene cycles, safety settings or booster controls based on a cost estimate. Follow the manufacturer's operating instructions and qualified installer advice. This calculator estimates costs from supplied energy; it does not prescribe a temperature, wiring change, timer window or system size.
More Australian calculators
Sources and checking your inputs
- Australian Government: hot-water system types and energy guidance
- Your Home: hot-water systems, COP, boosters, controlled load and quotes
- Your Home: rooftop solar, self-consumption, feed-in credits and export limits
Source review: 3 October 2026. Check the current bill, product documentation and installer quote for your circumstances. Report a correction.