5 signs your hot water system needs replacing
Most Australian hot water systems last 8–12 years. Some go longer with luck and good maintenance, some die at 6. If you're seeing two or more of these signs, it's time to start getting quotes — not to wait for the tank to burst on a Sunday night.
1. Rusty or discoloured hot water
If hot water from the tap looks orange, brown, or has a metallic taste — your tank is corroding from the inside. The sacrificial anode rod (the bit that's supposed to corrode instead of the tank) is spent. Once you see rust in the water, the tank itself is rusting and could leak within months.
2. Visible water around the base of the unit
Any pooling water, damp patches, or staining around the base of a storage tank is a leak. Storage tank leaks don't get better — they get worse, fast. Get a replacement quote the same week. If it's a pressure-relief valve drip (different spot — usually a small pipe out the side), that's repairable, not necessarily a replacement trigger.
3. The system is older than 10 years
Manufacturer warranties on Australian tanks are 5–10 years for a reason. After 10, you're on borrowed time. New systems run 30–60% cheaper per year (heat pumps especially), so the running-cost savings can pay back the replacement in 3–5 years even if your old unit hasn't died yet.
4. Hot water runs out faster than it used to
If your morning shower used to last 15 minutes and now goes cold at 8 — the heating element or burner is failing, or sediment buildup in the tank is eating into useful capacity. Both are signs the unit is nearing end-of-life.
5. Power or gas bill is creeping up
Old electric tanks especially get less efficient as the element scales up. If your bill has jumped without lifestyle changes, your hot water system is often the culprit. Heat pump upgrades typically cut hot water energy use by 60–75%.
Spot any of these? Get 3 quotes in under an hour →
What hot water rebates can you actually get in Australia (2026)
Australia has the most generous hot water rebate system in the developed world if you know what to claim. Here's what's actually available in 2026, by state.
Federal — Small-scale Technology Certificates (STCs)
Available nation-wide. Applies to heat pump and solar hot water systems. Your installer claims the STCs and deducts the value from your quote (you don't fill in paperwork). Typical value: $700–$1,400 depending on system size and your zone.
Victoria — Victorian Energy Upgrades (VEU)
The biggest state-level program. Heat pump installs to replace electric storage can attract $1,000–$2,800 off the upfront cost. Combine with STCs and a heat pump can be cheaper than a like-for-like electric replacement.
NSW — Energy Savings Scheme (ESS) + Hot Water Upgrade Incentive
Heat pumps and solar attract Energy Savings Certificates (ESCs). Combined with STCs, NSW households commonly see $1,200–$2,500 in combined rebates. Some councils (mostly western Sydney) layer additional council rebates.
SA — Retailer Energy Productivity Scheme (REPS)
Smaller than VEU/ESS but still meaningful. Typical heat pump install with REPS + STCs: $800–$1,800 off.
QLD, WA, TAS, ACT, NT
No major state-specific hot water schemes (yet). Federal STCs still apply. ACT has occasional grants for low-income households — check Actsmart.
What about gas?
Gas systems do not attract rebates in 2026. State energy policy across VIC, ACT and NSW is actively discouraging new gas connections, so if you're replacing a gas system, weigh up whether to stay gas or switch to electric/heat pump — the rebate math usually favours the switch.
See which rebates apply at your postcode →
What size hot water system do you need?
Get the size wrong and you're either running out of hot water during family showers or paying to heat water you never use. Here's the practical guide.
For storage tanks (electric, gas, heat pump)
- 1 person: 80–125L electric, 90–135L gas, 170L heat pump (minimum size for most heat pumps)
- 2 people: 125–160L electric, 135L gas, 170L heat pump
- 3–4 people: 250–315L electric, 170L gas, 270L heat pump
- 5+ people: 315L+ electric or twin systems, 200L+ gas, 315L heat pump
Notes: Heat pumps recover slower than gas, so size up by one tier if you have peak-hour clustered demand (everyone showering in the same 30 min). Electric tanks on off-peak tariff should size up by one tier to give a full day's water on one overnight heating cycle.
For continuous flow / instantaneous systems
Sized by litres per minute, not tank capacity. Rough guide:
- 16L/min: 1 bathroom, small household
- 20L/min: 2 bathrooms, average family
- 26L/min: 3+ bathrooms or simultaneous use
- 32L/min: Large homes, multiple bathrooms in use at once
Not sure which size? Tell us your household and we'll recommend →
Heat pump vs gas vs electric: which is cheapest in 2026?
Short answer: heat pump for almost everyone, once you factor in 10-year total cost of ownership. Here's the actual maths for a 4-person household.
| System | Upfront (installed) | Annual running cost | 10-year total |
|---|
| Electric storage 250L | $1,200 | $800 | $9,200 |
| Gas storage 170L | $1,800 | $400 | $5,800 |
| Gas instantaneous | $2,100 | $350 | $5,600 |
| Heat pump 270L (after rebates) | $2,800 | $220 | $5,000 |
| Solar HW + electric boost (after rebates) | $3,500 | $180 | $5,300 |
Heat pump wins on 10-year total cost — and the gap widens further if electricity prices keep rising (they have, every year, for a decade). Pair a heat pump with rooftop solar PV and the running cost can drop below $100/year.
When NOT to go heat pump: if you have less than 600mm of outdoor clearance, very cold climate (below -5°C overnight regularly), or you're a renter doing a quick like-for-like swap for the landlord.
Get a heat pump comparison quote for your home →
Emergency replacement: what to do if your hot water dies tonight
Tank burst, pilot light won't reignite, electric storage is leaking — the practical steps to get hot water back fast.
Step 1: Stop further damage
- Electric storage leaking: Switch off at the meter box (the dedicated hot water switch). Close the cold water supply valve into the unit (usually a brass tap on the cold inlet pipe).
- Gas leaking smell: Don't switch anything. Open windows. Call your gas distributor's emergency line (printed on your gas bill) immediately.
- Tank burst flooding: Cold water shutoff first. Move anything valuable out of the area.
Step 2: Decide repair vs replace
If the unit is under 6 years and the issue is a thermostat, element, valve or anode — repair is usually $200–$500 and worth it. If it's leaking from the tank itself, or it's over 8 years — go straight to replacement. Paying $500 to nurse along an 11-year-old tank that will die again in 6 months is bad money.
Step 3: Get three quotes — yes, even in an emergency
Most installers can be on-site same day or next morning for emergencies. Three quotes typically saves $300–$800 even under pressure. Submit our form, tick "needed today" — quotes usually land within 30 minutes.
Step 4: Cold-water plan for the wait
Boil the kettle for dishes. Skip showers or use a gym. Some installers offer same-day install if you call before 10am — submit early in the day if possible.
Need it today? Submit the form, tick "needed today" →