For Adelaide households in 2026, heat pump electric hot water paired with rooftop solar is now the lowest-running-cost option, typically 60-70% cheaper to run than gas storage when most heating happens during daytime solar hours. For households without solar, gas continuous-flow (instantaneous) remains competitive on running cost but loses on long-term capital — federal and state incentives heavily favour heat pump electric.
Running cost — 10 year window
For an average 2-3 person Adelaide household using ~150L hot water per day, the 10-year running cost ranking in 2026 is:
- 01Heat pump + solar: lowest running cost — most heating during daytime PV generation
- 02Heat pump grid-only: next — coefficient of performance (COP) of 3-4 means 3-4 units of heat per unit of electricity
- 03Gas continuous-flow: middle — efficient, predictable
- 04Gas storage: higher than continuous flow due to standing losses
- 05Electric storage off-peak: similar to gas storage in cost, simpler to install
- 06Electric storage continuous: highest — virtually never the right install in 2026
Capital cost
Heat pump electric units have higher upfront capital than gas storage but Australian and SA government rebates (Small-scale Technology Certificates and the SA Hot Water Rebate program where applicable) typically offset 30-50% of the unit cost. Net capital is comparable or favourable to gas continuous-flow installation for most households.
Practical considerations
- Heat pump units need outdoor placement with airflow and condensate drainage — most Adelaide homes have suitable space
- Heat pump units make a fan/compressor noise (typically 40-50 dB at 1m) — placement near bedroom windows is poor
- Gas continuous-flow needs a connected gas line — switching from electric to gas adds significant capital cost
- Switching from gas to heat pump is the most common upgrade path in Adelaide right now
- Heat pump units have a larger physical footprint than equivalent-capacity gas storage
Which household profile fits which type?
Heat pump electric (with solar)
Best for: owner-occupied homes with rooftop solar, families of 2-5 people, suburbs with reliable grid connection, customers planning to stay 5+ years to capture the running cost payback.
Gas continuous-flow
Best for: homes already on natural gas, larger households (5+ people), heritage homes where outdoor heat pump placement is constrained, properties without solar where heat pump electric capital is harder to justify.
Gas storage
Best for: like-for-like replacement only when capital is constrained and the existing gas connection is in place. Increasingly rare new install in 2026 — continuous-flow has overtaken it on most metrics.
