NSW Climate and Energy Action

Solar water heaters

Solar water heater on the roof of a house
 

Slash your water heating bills by around 80% with a solar water heater.

How it works

A solar water heater uses solar panels on your roof to absorb heat from the sun. This is used to heat water, which is stored in a heavily insulated tank ready for you to use in your home or small business. Most systems include an electric or gas booster to ensure you still have hot water on days with less sun.

Who it’s best for

Solar hot water is a good option for any homeowner or small business owner wanting to cut energy bills and reduce emissions. Consider a solar hot water upgrade if your:

  • current water heater has failed or is facing an expensive repair
  • water heater is over 10 years old
  • household or business uses a lot of hot water
  • property has adequate roof space for solar generation.

How much you can save

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$190–$700

per year on your energy bills.

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20–25%

lower on your household energy use using solar hot water.

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3 tonnes

per year of carbon emission reduction, similar to removing a small car from the road.

How much it will cost

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$4,000–$8,000

The cost of installing a solar water heater can range depending on the size, model and the installer you choose.

You may be eligible for NSW and Australian Government incentives that can reduce this upfront cost.

 


Get started

  1. Choose your solar hot water system

    • Get multiple quotes from licensed plumbers who specialise in solar water heater installations. Different plumbers offer different models and different prices. It’s important to compare options so you get the best deal for you and your home or business.
    • Pick a thermosiphon system (tank and collector on the roof) or a pumped system (collector on the roof, tank on the ground) depending on your roof strength and hot water needs.
    • Look for a built-in timer so you can choose to heat your water with solar energy or with off-peak electricity prices.
  2. Install your solar hot water system

    • Check that your installer has a current licence on the Service NSW website. The installation must be done by a licensed plumber and/or electrician for a safe and compliant installation, and to be eligible for incentives.
    • Ask installers:
      • which brands and models they have that are on the Clean Energy Regulator’s register. Only these solar water heaters are eligible for incentives from the Australian and NSW Governments
      • to help choose the right tank size for your household’s needs to ensure you don’t run out of hot water
      • about the system’s installation location so that it’s safe and has adequate air flow
      • about the system’s warranty period, which should be for a minimum of 5 years
      • if they are going to insulate the storage tank and all hot water pipes to prevent heat loss
      • if their service includes professional removal and recycling of your old tank. If your existing water heater is gas, you’ll also need a qualified gas technician to remove it.
  3. Get the most out of your new solar hot water system

    • Use the booster element sparingly if you have a manual booster. Only turn it on when you've had several cloudy or rainy days in a row.
    • Check your roof panels are clean and not shaded by overhanging tree branches.

How to get financial help

NSW Government's hot water upgrade incentive

  • Who it's for: NSW homeowners installing an eligible solar water system with an accredited provider.  
  • How it works: Get an upfront discount on the quote for the installation This could be:
    • up to $900 for replacing an old electric water heater with a solar water heater with a electric booster
    • up to $550 for replacing a gas water heater with a solar water heater with a gas booster.
  • How to access it: Get multiple quotes to find the best water heater and price for you and complete the required paperwork from your installer.

Australian Government’s Small-scale Renewable Energy Scheme (SRES)

  • Who it's for: Australian homeowners replacing an older solar water heater with an eligible solar water heater.
  • How it works: Get an upfront discount on the quote for the installation. Households can seek incentives from both NSW and Australian Government.
  • How to access it: Get multiple quotes to find the best water heater and price for you and complete the required paperwork from your installer.

Other energy efficiency upgrades we recommend