Solar Hot Water vs Solar Panels. Which should you buy?

Poor old Solar Hot Water.

The concept of heating water directly from the Aussie sun with a solar hot water system like this…

a solahart hot water heater

The humble solar hot water heater

…really seems to have gone from hero to zero over the past 3 years.

Both homeowners and solar companies have been seduced by the siren call of these:

solar pv panels on a roof

Solar PV panels like these are now a much more common sight than solar hot water panels

Solar PV panels are sold on the promise of cheap electricity, quick installation and low maintenance. And most companies that specialise in solar PV will claim that PV has a  faster payback compared to solar hot water.

In fact, over the last 3 years the solar hot water market has shrunk by two thirds.


Well, the unexpected scrapping of the $1,000 solar hot water rebate in 2012 didn’t help. But the bigger nail in the coffin has been the reduction in cost of solar PV systems .

How so?

To illustrate the shifting economics, let’s take a typical Aussie home with a standard electric water heater.

To heat enough hot water to keep a 3-4 person household happy will need about 3,000kWh of electricity per year. Or about 8kWh per day. Here are the homeowners’ 2 options if they want to join the 21st century and heat their water with the sun instead of dead dinosaurs:

Option 1: Use a solar hot water system to heat the water directly


A solar hot water system will typically cut your water-heating energy bills by 70-80%.

The price of a suitable solar hot water system is about $4,000 installed.

[That’s for a flat-plate thermosiphon (tank on roof) style system like the one in the first pic above. I struggle to recommend that people shell out $7,000 or so for a fancy evacuated tube system with remote tank and pumps. Flat plate tank-on-roof systems really are good enough in most of Australia (with the possible exception of chilly Melbourne and Tassie) and damn reliable to boot]

Payback for this option:


The payback for this option depends on what you are replacing with the solar hot water heater.

a) Replacing an electric heater on a regular tariff

If you are replacing a conventional electric hot water system, expect savings of about $700 per year if your heater is on the same tariff as the rest of your appliances . Payback will be  about 5 years (assuming 7% electricity price inflation).

b) Replacing an electric heater on an off peak tariff

If you are lucky enough to have access to off peak electricity for water heating, then this drops to about $250 per year in savings. And therefore payback stretches out to 10 years (assuming 7% electricity price inflation).

c) Replacing a gas water heater.

A typical Aussie home with a gas water heater uses about 14,000MJ of gas per year to heat their water. This is about $420 worth of gas. Saving 80% of this is worth $336 per year. But… gas prices will to go through the roof over the next couple of years for these reasons. I expect residential gas prices to double. So you could well be looking at savings closer to $700 per year with if replacing a gas heater with solar hot water. This would give a 5-6 year payback.

So that’s the costs and paybacks associated with a conventional solar hot water heater. How does that compare to a 100% PV based system? Let’s see…

Option 2: Use solar PV to generate the electricity to heat the water.

To reduce your water heating energy using only solar PV, you are obviously going to need to install solar PV panels instead of a solar hot water system. Combine those PV panels with a timer that only allows water heating during the day and you can make the same savings with a 2kW solar PV system.

The going rate for a good 2kW solar system is about $4,000 installed. Same as the hot water heater. So the paybacks are exactly the same as the ones I went through for Option 1 above. Interesting…

But now let’s consider a house that (very sensibly) is already buying a solar PV system to cover its other electricity needs and instead of buying a solar hot water system, is considering simply getting a bigger PV system:

Option 3: Increase the size of the solar system you were going to buy anyway

As mentioned, a good 2kW solar system will cost around $4,000. But if you have already decided to buy solar for your home, then increasing the size of the system by an extra 2kW (to offset the water heater’s energy needs) will only cost about $2,500 extra. Almost half the cost (and almost double the payback) of buying a solar hot water system.

In this case you can see that, if you are already buying a solar PV system for your home, adding 2kW to that PV system is potentially a much cheaper way to heat your water than buying solar PV plus solar hot water.

So why does anyone buy solar hot water these days?

Good Question. I am actually still a firm believer in the humble solar hot water system. I have one on my roof next to a 6kW PV system. Here’s why I bought a separate solar hot water heater (thermosiphon with instant gas boost) instead of getting an 8kW solar system.

Reason 1 – I crave a simple life. A good solar hot water heater is set and forget. Once it is on you can rest easy, knowing that if there is sun shining – it will heat as much of your water as possible – and the booster will only fire up when necessary. I like that. I don’t want to worry about timers or other fancy controllers that try and sync my PV production with my water heating. I want to live in a dumb home that just works and is comfortable and efficient.

Reason 2 – I like elegant solutions. A solar hot water system is a much more elegant (and thermodynamically efficient) way to heat water than the rather convoluted process of turning sun to electricity and then turning that electricity back to heat. Hey – I’m an engineer and I appreciate the simplicity of putting the sun’s heat straight into the water. Also despite environmental reasons for buying solar being rather out of fashion in these days of brutal economic rationalism –  I still give a shit about these things. The embodied energy of the solar water heater is much less than that of 8 solar panels. And it’s made in Australia. Yes – I care about Australian manufacturing too.

Reason 3: Roof space is valuable. My solar hot water system takes up a quarter of the space of 8 more PV panels. North facing roof space is going to become a very valuable asset in the years to come as solar continues to reduce in price. I want to have some roof left so I can add more panels in the future to power batteries, or that Yorkshire Bitter microbrewery I dream of starting in my garage or whatever else I might need extra solar electricity for in an uncertain future.

So yes – if you want to be totally economically rational about the thing and you are buying a solar PV system at the same time and you have an existing electric water heater which is too good to replace. then you can certainly save a couple of thousand dollars by adding 2kW to your PV to cover your water heater’s usage instead of a solar hot water heater. (Just be sure your installer knows how to set up your hot water system to draw 70-80% of its electricity from the solar panels, by installing the requisite control electronics or timers.)

But if you are building a new home, or replacing your whole hot water system, a good old fashioned flat plate thermosiphon solar hot water system is definitely worth considering. Especially if you are an old fashioned, greenie engineer with romantic notions about thermodynamic efficiency and Australian manufacturing like yours truly.

A footnote about a wildcard fourth option: A Heat Pump hot water heater. If you are keen to use PV to power your hot water heater then you don’t have to use a conventional style electric hot water heater (which has all the technological sophistication of a bloody big kettle). In fact most states won’t actually let you install a conventional electric water heater any more because they are so damn inefficient. A Heat Pump electric hot water system uses a little built in air conditioner on its heating cycle to heat the water. For thermodynamic reasons that I won’t go into here, they are 3-4 times more efficient than a standard electric water heater. So why doesn’t everyone have one?  Mainly because they are expensive. Fully installed expect to pay $3-4k for a good one. And they are high maintenance and noisy. This means that in the “Solar Hot Water vs Solar Panels” debate in Australia they have really struggled to get a mention, because  you can get a silent, low maintenance, more efficient solar hot water system for about the same money.

Note: July 2016, I’ve written a new article on choosing solar hot water with more up to date info here.

About Finn Peacock

I'm a Chartered Electrical Engineer, Solar and Energy Efficiency nut, dad, and founder of My last "real job" was working for the CSIRO in their renewable energy division.


  1. Solarhart systems from the late seventies into the 1980s were hot sellers, particularly on Hotel, Motel and commercial applications. I put one on a house I built in 1983, and it hasn’t had any repairs or service work on it since. Still going. As are a lot of systems that other people fitted up so long ago.

    • Yes Minister says

      I don’t know that many Solarhart systems over five years old will still be operating. An associate had a supposedly ‘top of the line ‘Black Chrome’ one that apparently started leaking from the panels the day the warranty expired although the tank & booster were still OK. Recently we pulled the old panels down (replaced them with Edwards panels) & had a look inside the removed ones. They can only be described as complete and utter crap. Dunno where the highly touted ‘Black Chrome’ is, collectors are basically sheets of mild steel with a few ribs formed into them & spot-welded together. Seems Solarhart heat-exchanger systems were setup with glycol but the mild steel panels rusted out very quickly regardless. Edwards panels (at least the original ones) were more professionally made with soldered copper tubing … dunno about the current Rheem ones though…

      • Ron Hoogland says

        Solarhart has been mentioned a few times.
        I have a Solarhart hot water system. When it was installed the insulation in the roof space caught fire. They put it out with buckets of water.
        The ceiling of the loungeroom got wet.
        Solarhart was notified. Nothing happened.
        Solarhart was notified again via a different channel. The person agreed that it was unacceptable follow-up service.
        A person came out to inspect the job and took photos.
        He also stated it was poor service.
        And what happened next???
        Thank you for nothing Solarhart.

        • Wow – that’s terrible – which Solahart dealer was it?

        • Yes Minister says

          If anyone has the misguided conception that Solarhart products are good things, I’m quite happy to provide photos or even arrange an inspection of the one my colleague had (still has the panels just in case someone is interested in seeing for themselves just how utterly crappy they are). He currently has new / old stock (hence probably nothing like current model) Edwards panels that we inspected minutely before installation & they are all copper / three times the weight of the el crappo Solarhart ones.

          • Nathan Birss says

            Finn, can you help please? I have a new 8kw solar system, purchased with the help of your site thank you, and a solar hot water system. When is the most efficient time to run the booster if needed? During the day using the solar, or at night using off peak?
            Thanks, Nathan

          • Ronald Brakels says

            Hi Nathan, Ronald here.

            What is best depends on your solar feed-in tariff and the off-rate peak you’d need to pay at night. If the system doesn’t already have a timer then the cost of having an electrician install one would also need to be considered. The good news is your hot water system isn’t likely to need much boosting, especially now that the weather is getting warmer so there’s no need to rush into a decision. Without knowing the details I can’t tell you which is best, but I can tell you that it often doesn’t make a large difference.

  2. Yes Minister says

    I’d install a solar hot water system this afternoon if it was practical, however my north-facing 22 degree roof is already fully populated with PV panels & fitting solar hot water panels on the southern roof would entail a major engineering feat. I do have some north-facing 10 degree veranda space available but using that for solar water panels would involve very messy pipework (all plumbing is on southern side of house & ceiling isn’t acccessible). Heat pump systems are ridiculously expensive, quite noisy, and if the experience of associates is any indication they are not particularly reliable. Preesently I’m using an instantaneous gas water heater athough I’m expecting LPG prices to go into orbit in the forseeable future. When that happens I’ll do the sums on whether its more cost-effective to buy a cylinder of gas every 9 – 12 months or to install an electric water heater & feed it some of the surplus PV electrons.

    • A roll of polypipe chucked on the roof works well (and extended/insulated to where your plumbing is) ~ cycled through an old cylinder and then run through an instantaneous lpg hws. ((Also cheap these days.)

      Even cheaper ~ if more inconvenient ~ is a ‘chip-heater’ as all the best houses had 100-some years ago…..mounted on the wall above the bathtub.
      I knew a bloke in Nth.NSW years ago who used to have a bucketful of coral lumps soaking in a bucket of kero beside the bath, and just stick a lump on the ‘hot-plate’ for as long as he required hot water.

      There are always all sorts of options.

      • Yes Minister says

        I’ve certainly heard silier suggestions 🙂 🙂 🙂 … there is no doubt something like that would work however if one (as a non-qualified plumber) is proposing to connect piping that isn’t approved for mains pressure to a mains pressure hot water system, you do run the risk of bureaucratic intervention. I was just thinking it would be interesting to roll something like that out for a few ‘down on their luck’ folk but by going from an outside tap to the poly-pipe on the roof and thence through the bathroom window with a sprinkler thingy on the end. Putting the roof-warmed water through a hot water system cum booster is undoubtedly nicer, but I personally wouldn’t dream of doing that for anyone else due to the potential for all manner of repercussions. Maybe there is less chance of getting the muppets upset if the property isn’t mains-water connected.

  3. PS.. Roll of polypipe about $85, plus fittings about $20.
    Old HW cylinder $0.00 ~ from the tip or hard-rubbish collection.
    Chip-heater, about $5 (mainly solder and petrol to get to the tip and back with recycled bits…..) 😉

    • Hi Dabbles,

      Can you send us a picture? 🙂


      • Yes Minister says

        There is a slightly more advanced version of that sold for pool heating … surprisingly effective although I’ve never seen one of those produce boiling water. That said, it would almost be worth some enterprising folk doing freebie installs for impoverished pensioners who can’t afford to turn on their electric heater. Mind you I can just imagine all the over-paid and over-officious bureaucratic muppets throwing a wobbly about sub-standard plumbing 🙁 🙁 🙁 Guess if it was downstream of a professionally installed tap there isn’t anything that could be objected to..

  4. Hi
    Hi, I installed a Chromagen Solar hot water system 2 years ago with gas booster. I got a larger storage tank than standard, thinking that while the sun shines, store as much hot water as i can (my wife’s showers are a bit ‘long’) So far it seems to be working well. The old system was off-peak electric storage which was 22 years old and starting to look like it was on its last legs. The solar system cost only $1350 installed. About the same as a gas only system so a no brainer for me.

    It’s hard to be precise but i estimate the savings to be about $50 per month. I fitted a temperature sensor at the outlet pipe of the panels also and in summer it goes to about 100C. In winter, on a reasonable sunny day, it might get to about 20-30c, sometimes higher. Overall, its probably effective for about 6-7 mths a year.

    My only downside of this system is the poor regulation of temperature at the outlet taps in the house. The sensor in the gas booster needs a lot of water flow to fire it up. I am talking winter or low sun time here. The sensor measures the flow rate. If you turn on the Hot water tap, you need the flow to be quite high for the booster to start up, if you then quickly turn on the cold water, to regulate the temperature required, the sensor has insuffienct flow and turns OFF the booster ! The only way round this is to very slowly turn on the hot water tap. Thats OK in the shower we have (seperate taps) but in our kitchen with flick mixer, its a nightmare. You just can’t regulate the temperature unless the flow rate is VERY high…. In summer time when the booster is not needed, there is no problem.

    I have complained about this several times under warranty, they say that’s how it is, the flow rate is too low. Even so, they replaced the external temperature ‘regulator pipe gadget’ and its still the same.

    • HI Glenn,

      Thanks for the update! Where did you get your system from, that is an incredible price compared to Solahart etc!


    • Hi Glenn,

      I had the same issue with the Chromagen gas booster. I also replaced the ‘flow rate’ sensor which is supposed to turn on the gas @ 3 liters and maintain the gas @ 2.5 liters. My issue was traced back to the tempering valve which has to be fitted after the gas booster. The tempering valve is mandatory for all solar hot water systems as the solar panels can heat the water to almost 100C. This mixes cold water into the supply to reduce it to 50-55C (depending where the valve has been adjusted to). The issue is these valves fail and they randomly mix cold water with the hot water.These reduces the demand through the gas booster which then shuts off. Please get your tempering valve checked.

  5. Hello again Finn, completely agree with old style solar hot water- set and forget is definitely the way- been using Edwards for over 20 years and formula I use is 305 litre drum and x2 quick recovery panels which is good for 4+ people and I fit one every time I change houses-most of the time never turn on the electric booster since supply with sun is ok for 9 days sunless. Only problem I have ever had and its common to Edwards it seems is the booster temp cut in/out relay stuck in side the cover plate trips over time by temp change in drum itself when not using booster but there is a reset on the unit that clicks when pressed and booster then works again. Used to cost me $60 to have that done until I woke up to this reset Robertshaw ST1205134 is a standard fitting and written on the backplate is the faint word RESET and directly above it is a small circular recess that is in fact the reset that can be depressed by a biro [any brand will do] and usually does not need to be replaced! and is a ten minute fix. Re -Solahart system came to the conclusion they were rubbish from birth unless very early models made from copper since material used corroded- Edwards were stainless so fine- but- since Rheem bought them out not sure any more about Edwards- the last one I bought had corners cut in material quality of the anticyclone fitting bracket system I always used [makes it easy to fit system together] but checked the quality of the panels and drum and they seemed to be ok -Rheem had just bought them out and had not introduced their 2.4 year planned obsolescence yet. If not them any more maybe Berkely would be ok since their philosophy was similar to Edwards but have no idea if they are still around. 25+ years definitely works for me!. So-thats it from me—cheers–Mark

  6. Similar to how I heat my pool – clamp 2 pieces of roofing iron together – run polypipe back and forth in the corrugations paint the top one black – place on roof- redirect water return to pool – this adds several degrees.

  7. Is it theoretically possible to use the heat generated from the A/C system to heat your hot water? Seems like it should be possible to build a system that could do both. Currently the A/C system wastes the heat and the heat pump HW. heater wastes the cooled air.

    • Hi Tom,

      Yes that is totally possible. Some people call it Trigen. CSIRO have done a lot of work on similar ideas. It tends to be used in industrial applications because the heat exchange hardware is expensive, and only makes sense when there is a lot of heat and cool being generated.

      Solimpleks have a combined PV/hot water panel that uses water to cool the PV, improving the PV’s efficiency and then using the hot water. It only makes sense if you can use a lot of hot water though e.g. you have a large pool.

    • The AC and hot water system are available in the market. I have seen them in tropical countries as the AC is used a lot and the hot water requirement is not that large.



  8. When deciding on solar systems to install, it would be a good idea to check that the electrical approvals are not gained from the Queensland Office of Electrical Safety. It seems that there is little or no checking on component safety details and that components are approved by rubber stamping an approval. As it has been with pressure vessels approval in Queensland for some years.

    • Yes minister says

      check that the electrical approvals are not gained from the Queensland Office of Electrical Safety

      Typical gubmunt muppets, just little tin gods with a book of rules, not a clue in the world & primary interest in throwing their weight around. Personally I have nothing but contempt for this breed of oxygen bandits however there are occasionally ways to gain the upper hand. Quite often in the building & construction industry an engineer or architect has higher authority, not certain if that applies with electrical installations however, although I can perceive such a circumstance in the forseeable future thanks to the rule insisting on rooftop isolators (with precious few exceptions). With one of my PV systems there is no possible point in having rooftop isolators, in fact it would be well nigh impossible to fit them in a halfway accessible position, consequently I’ll almost certainly need to find a higher authority to override the relevant muppets should they stick their noses where its unwarranted…

  9. It was via Bunnings i think at that time, who were promoting Chromagen. At the price, it made a lot of sense.

  10. Hi Fin,

    Thanks for the article. What brand of hot water heater do you have installed and do you have gas running past your house or do you use bottles?



    • Hi Jeff,

      I have a Solahart thermosiphon with an instant gas boost. I have gas in the street.



      • Hi Fin,

        Another question. I’m in Hobart. Do the thermosiphon’s work OK in colder climates or would you recommend evacuated tubes which are more expensive and any particular brands that you or your readers would recommend or avoid and which backup boost would you use….we don’t have gas running past our house. I have heard that you can get timers installed with electric boost systems so you can control when they come on during the day to give the solar a chance to do its thing before turning the boost on at night I assume?



        • Hi Jeff,

          In cold old Hobart a flat plate system will provide about 50% of your hot water heating energy from solar. It is one of the few places in Australia where you may want to go more efficient to squeeze every last drop out of your precious sun.

          Evac tubes can help, if your installer understands the optimum angle to put them at and it is a good efficient evac tube system. Some of the evac tubes out there are less efficient that a good flat plate system. I’ll post a blog early this week that shows you how to rank hot water systems by efficiency using publicly available data. Watch this space!

          Hope That Helps,


  11. We use all three technologies (and a fourth*) on our homes. Most of our rentals have solar electricity panels _and_ solar HWSs. Our home residences use a 26 y o custom-built SHWS (still no problems), a solar heat pump (a little noisy in design) and a water jacket within a Rayburn stove (again 26+ years-in-use.) Very interested in Tom’s query re dual benefits. My query is the reverse to Tom’s. We noticed that the solar heat pump cranks a lot of frigid air (outside) while heating hot water. I’ve often wondered if a cowl capturing this cool air might be used to redirect chilled air back into that house. Any downside? Might it place too much load on the heat pump, for example? There must be immense future potential for this dual use application!
    * Yes, I’m burning wood (most of it seasoned… ‘windbreaked’ back in 1945) but with little negative consequence overall… .

  12. Hi Finn, I have a conundrum. We live on acreage in a very old house that needs to be demolished in time and we plan to build a fairly self sufficient house to replace it. Problem is that could be 2-5 years away and I really want to go solar long before that. Given that I have space in the form of land that I could put them on rather than the roof of the old house, am I better to go solar PV with a view that I can simply move the connection to the new house rather than risk putting a new solar hot water system on the old roof that might not fit in with a new house design? I am in Brisbane so sun shouldn’t be a problem. Any thoughts, ideas? Kelly

    • If you have lots of land, then ground mount systems are certainly possible. But you may find it is cheaper to simply move the hot water system to your new house (which I’m sure you’ll design to be solar friendly 😉 ) instead of investing in the structure required for a ground mount solar system…

    • When my old dad moved onto a large acreage in retirement, the first thing he constructed was an Energy Shed. Later, he build the house about 10m in front of it. You’d need to ensure shire or council authorities would permit it.

      I’m currently attempting to convince my better half that a rammed earth garage large enough for our cars, m/cycles, bicycles and the boat, would provide enough roof space for a 5 kW system… .

  13. I have a heat pump. Cost $1000 after $2400 of government rebates. Haven’t had any problems with it and it is quiet. 1.5kw solar electricity cost $3000. Haven’t paid for electricity for years now.

    • We paid around the same for the heat pump. The installers fitted a timer, to ensure that it only turned on in the early afternoon… to ensure the noise didn’t wake our chalet guests (friends and rellies). We turn it off when the chalet’s vacant, so the timer is always out-of-whack. In our hole-in-the-forest, the only noise one can hear now (apart from the birds) is that freakin’ heat pump. It’s a pain in the butt!~

      • Yes Minister says

        When I was looking for a completion certificate on the new house, council wouldn’t let me have an old style electric hot water system & wanted me to get a heat pump at some ridiculous cost (maybe cheaper these days). To silence the muppets I installed an instantaneous gas system (no mention then about gas price escalation) & only a couple of months later Noddy & friends reversed the rule about electric systems. I did ask a few locals about their experience with heat pumps & without exception was told to forget them (cost / noise / technical problems / failure to provide sufficient hot water) Anything with motors, fans & a zillion fiddly bits is certain to be more troublesome than something with only a couple of moving parts.

        • We’d have preferred a solar HWS, but NearMaps indicated the chalet’s roof was too shaded. The SHP is certainly quite noisy. I can hear the dull whine from the main house, 100m away. We’d given up on gas. In fact, we’re replacing all our gas units with SHWSs, as the Bosch gas units (repeatedly) fail at each rental.

          Because both our main house and the guest chalet share the same circuit, we’re limited in electric options. The Heat Pump seems to have some advantages: Hotter, more reliable hot water; cheaper than bottled gas to run; and external air-con in hot WA summers. On a stinking hot summer day, a picnic table and two chairs, a glass of white and BYU… . 😉

  14. Hi Finn,

    I have just installed a 3KW PV system (for a two person household) and would like to use the excess solar power for hot water. Do you know of any products currently available in Australia like the Immersun (

    My ultimate objective is to move away from gas. Once I change from gas to PV solar hot water all I need to do is install an induction cook-top.

    I will do this even if I have to upgrade the solar. I am motivated mainly by a desire to move to renewables. But I am looking forward to telling AGL to disconnect the gas and that the derisory 8 cents they pay me for power I feed into the grid made it a sound business decision.


    • Finn Admin says

      Hi Bob,

      These guys appear to be selling the Immersun for $875 in Oz:

      There is also this which I am told will make it over here from the UK “at some point”:

      Then there is the easy heat from NZ: – but I think that requires you to swap your inverter for one of theirs.

      The proper Backyard Aussie way to do it for $99 is given here by a commenter called “Le Clair”. Here’s what he did with 2 simple $10 timer switches and a clued up sparky (although bear in mind that this solution does not monitor your PV or hot water current draw so you need to be confident that your PV is big enough to power the element throughout the year) :

      Easy is the answer assuming you have a resistive element somewhere in the system. You need 2 programmable timer switches (available from ebay for around $10 each) and an electrician. Timer switch #1 is installed in the meter box to interrupt the flow of current from the grid to the element in the water heater. Switch #2 is installed in the meter box connecting the inverter output to either the house load or the supply for the water heater circuit. Program switch #1 to be always open circuit except between, say 11am and 1pm (2 hours). Then program switch #2 to always connect the inverter output to the normal house load (NC connectors), except between the hours of 10:58am and 1:02pm. The element in the HWS will not draw any energy (because the timer has disconnected it from any electrical supply), then at 10:58am the inverter output will be switched to, presumably, the off-peak tariff circuit. 60 second countdown. The inverter will take about 30 seconds to reach full output when switch #2 connects the HWS element to the same circuit now powered by the solar.
      Presto, you are now storing energy that would otherwise have been stolen by the grid as hot water. At 1pm the HWS is disconnected from the grid (most likely the thermostat clicked off well before that anyway) and the inverter is switched back to the household load. Of course, your electrician should be able to size your HWS heater element to best match your PV system output. Excess energy (if any) is still exported “earning” you whatever tariff is applicable.

      (Cut and pasted From comments section at )

      • Yes Minister says

        Interesting technology indeed, although not something I’d use in the immediate future. I currently use LPG for water heating only & if / when to Australian LPG price goes ballistic, I take a closer look. Based on the 52c FiT continuing til 2028, I don’t believe it would be cost-effective to use valuable income-earning electrons to heat water considering LPG currently only costs me around $120 per annum, however that rose to $1000 or more.I’d have a VERY serious look at the options.More ‘stuff’ on the north facing roof isn’t an option as 64 grid connect panels & 12 off grid panels leaves no room spare and putting anything on the south facing roof would be a massive engineering task. Wonder if I could whack a few off-grid panels on the toolshed.and feed an electric storage system directly from an off grid inverter to save the cost of more batteries.??

  15. Hi Neil
    thanks for reply

    I have had the tempering valve replaced very early after the install and my complaints. It made no difference at all. Service then toild me that the flow we use is too low and to “turn on the tap more” or words to that effect.

  16. I’m confused as what to do, I live alone in a 3 bedroom two storey townhouse with a 20 year old 300ltr Hardie Dux electric hot water system in our garage. My power bill is roughly $350 per quarter. Should I replace it with solar now before it dies, if I were to replace it, what should I look at doing eg buy solar panels or a solar hot water on the roof? I live on the Gold Coast and my roof gets all day sun. I don’t want to be spending too much money as I may sell the property in 3 or 4 years. Also what it would cost roughly, considering the installation is probably more being a two storey townhouse. Would appreciate any feedback

    • Hi Wendy,

      With that power bill, I’m assuming your hot water is on off peak?

      Economically speaking – if you are selling your home in 3-4 years you will struggle to get any solar investment back. A enlightened buyer may value any solar power or solar hot water on your roof, but unfortunately most home buyers in Australia do not – according to every survey I’ve seen.

      Your cylinder is probably due for replacement – I would recommend a high star rating replacement that is “solar hot water ready”. Most companies have this option. Then any new owners can upgrade to solar hot water easily by bolting on a heat pump or hot water panels on the roof.

      Hope That Helps,


  17. I have a 5kw system on my east west roof. 13 panels each side which isn’t great but its all I could do. I was looking at adding more panels to optimise my system, as I can get some matching 190 panels which aren’t stocked anymore. The supplier reckons he can put up to 18 more panels on the roof and the 5kw sma inverter would be fine. I,m a little concerned about overload and what the electricity company might say about the increased credit they will have to pay. Are there any issues with doing this?

  18. Finn,

    Any thoughts on comparison of having a roof solar hot water and PV solar with electric instantaneous system? thoughts appreciated.

    • Instantaneous heaters pull enormous currents for short periods. I’m talking 15-20kW. So they are not suitable for powering with PV. Also the whole point of electric boosting is that the hot water load is time-agnostic. You treat it like a battery because it stores heat – so you can dump excess solar into it. More info here.

      Instantaneous electric on its own requires massive cables, and cannot be put on a cheap controlled tariff. If you have a standard electric storage system on a cheap tariff then that will be cheaper. If you have electric storage hot water on a day-time tariff then instant electric will be cheaper to run.

  19. Hi,

    I am a retiree and need some advice on things solar. At moment I don’t have solar PV or Solar Hot water system. I only have an existing resistive element electric water heater which is still functioning well on Tariff 11. Daily energy usage is 7.0 kwh for heating and 8.6 kwh for lighting, fridge, aircon/fan (only during summer) and others. As I am at home during the day I have no problem controlling the timing of electricity usage

    Initially I was thinking of installing Solar Hot water system ($4000) AND a 3 kw Solar PV ($4000). After some research, I conclude that the better solution is to install a bigger 5kw Solar PV ($6000) and divert the excess kwh generated to power the existing electric hot water system during pre-set time in the day using a load shift timer to ensure NIL export to the grid. The payback improves considerably in this scenario.

    1) Can the existing electric hot water system still be on Tariff 11 as booster during the night if the daytime diverted energy is insufficient for BOTH normal daily usage and for heating?

    2) Is it necessary to turn up the tempering valve from 60 degree to 80 or 90 degrees to increase energy storage capacity?

    Thank you for any advice offered.

    • Hi Stephen – great questions.

      1) Can the existing electric hot water system still be on Tariff 31 as booster during the night if the daytime diverted energy is insufficient for BOTH normal daily usage and for heating?
      A1) In many states this is allowed. In QLD, Ergon don’t allow it with Tariff 11. But… With a 5kW array solar, a good PV diversion system, will do up to 95% of the hot water energy requirements, so if there is a “mains power gap” of 5% that is of little financial penalty compared to the energy saved in heating the hot water from solar.

      2) Is it necessary to turn up the tempering valve from 60 degree to 80 or 90 degrees to increase energy storage capacity?
      A2) From an energy storage point of view the larger the tank and the higher the temperature the more energy is being stored, so yes a switched on installer will optimise the tank temperature to maximise the system performance whilst being aware that the scalding potential increases.

      A very good system to do this is the Catch Power

      • Thank you Finn for the very prompt and comprehensive answer.

        1) Re: your answer (A1), the Tariff I intend to access is night time super economical Tariff 31 NOT Tariff 11. Does you answer change?

        2) Good to note that a PV diversion system can allow us to use the excess kwh generated for heating rather than export it to the ungrateful, greedy grid! Do we just have to install an additional electronic device to do this?

        3) Sizing of the PV system – I am thinking payback period here!!
        My total daily electricity consumption (heating plus others) is (7 + 8.6) = 15.6 kwh. Should I go for 3, 4 or 5 kw PV systems as I was told by consultants that 3, 4, 5 kw PV systems will generate 12.6, 16.8 and 21.0 kwh daily in Brisbane?

        If I go for 3 kw PV system, obviously I will need booster for heating hopefully from night time super economical Tariff 31. For bigger systems, I won’t need any booster except for cloudy days.

        4) How big a PV system (all installed with PV diversion system and ready to go) can I get with a $5000 budget? I don’t need a cutting, top end, bleeding edge product, just something sturdy, reliable and does its job well. Like you I like dumb (set and forget) solution with not too many failure nodes (failure prone electronic gizmos).

        Thank you.

        • 1) Sorry – I meant T31 !
          2) Pretty much:

          3) With the new Feed In Tariffs, I recommend getting at least 5-6kW of panels. The last extra 2-3 kW of panels are about a third the price of the first 3kW so the return on the extra panels is excellent.

          4) You should be able to get a good 5-6kW system from a good installer with mid range panels (e.g. Jinko) and inverter (Zever or Sungrow) for about $5-6k. But the Catch power is going to add another $1k on to that.

  20. Hi Finn,

    Thanks again for the very helpful info moving me closer to solar.

    1) Re your answer A1 again, is it only Ergon who disallow super economical Tariff 31 be used as heater booster? What about other retailer like AGL etc?

    2) Also do we have to inform the retailer that we are diverting excess PV kwh during the daytime for heating so that the water is already hot and NOT require any booster heating at night (Hot water cyclinder acting like a battery like you say)? In this scenario, with adequate excess PV kwh, Tariff 31 energy will be rarely used and is just on standby for cloudy days.

    3) So do I go for a 5 kw PV systems with a 4 kw inverter? I am told that the inverter should be smaller size than the panel (oversizing) but not too small to avoid “clipping”?

    4) Based on the info I provide so far, do you think that my proposed solution is the best option given that I don’t have any solar at the moment and that the existing resistive element electric hot water system can still be used and is on Tariff 31.

    5) Based on your info about the size of PV system fully installed (completed with all the gizmos to divert excess PV kwh for heating during daytime AND inverter), I should be ready to get 3 quotes from good installers using reliable mid range PV and premium inverter once the above questions are answered in the affirmative.

    Thanks again

    • Ronald Brakels says

      Hello Stephen, Ronald here. Finn is away, so I’ll have a go at answering your questions.

      1) To be connected to a controlled load, such as tariff 31, an appliance has to wired so it can only receive grid electricity via the controlled load. If your hot water system is set up to turn on during the day to take advantage of solar generated electricity then that won’t be the case and so it is not permitted and so it is not permitted to have it connected to tariff 31 or 33. This is the case throughout Queensland.

      2) There should be no need to inform your retailer. Your installer or electrician should take care of the paperwork. But after your hot water system is disconnected from tariff 31 it would be a good idea to check on your electricity bill that you are no longer being charged the daily meter reading fee for it. It comes to less than $10 a year, but there is no point in paying it if you don’t have to.

      3) Don’t worry about oversizing. In Australia, panel capacity can be one third larger than inverter capacity. With that amount of oversizing, energy lost to clipping is insignificant. I wrote about this here:

      A 4 kilowatt inverter with 5 kilowatts of panels will be fine. In fact, I would suggest going closer to the maximum you can have with a 4 kilowatt inverter which is 5.33 kilowatts of panels, as the additional cost of an extra panel or two is likely to be very low. And since both electricity prices and feed-in tariffs increased at the start of this month, you may wish to consider getting a 5 kilowatt inverter and up to 6.66 kilowatts of panels, provided they will fit on your roof. With Ergon’s feed-in tariff now 10.1 cents you may find it worthwhile.

      5) You appear to have done your research well, Stephen. One thing I will mention in case it’s not clear is, you have a choice between getting a solar hot water diverter which is still quite expensive, and just getting your solar hot water system put on a timer which is much cheaper. Because you are in Queensland where the weather is usually warm and you are planning to get a fairly large solar system, I’d say just getting a timer probably makes sense for you. But feel free to look into the cost of both.

      • Thanks Ronald for a very comprehensive response which is most helpful.

        1) With a timer (or even with the more costly solar hot water diverter), we would have a problem in WINTER (when we need the hot water most) as the Tariff the hot water heater is on will be switched to the more costly Tariff 11 instead of 31. It does not make a difference even if the system size is bigger (at 6 kw) if there is no sun. Heating the hot water in WINTER will become very expensive under this proposed solution then.

        2) I am just wondering if for heating, you go with Solar Heater system (instead of PV system), can the hot water heater be connected to the economical Tariff 31 or must it also be connected to Tariff 11? If it has to be connected to Tariff 11 (following Energex’s logic above when we divert excess electricity from PV system for heating purposes), how does the Solar Hot Water System help to lower the heating bills in the winter months?

        My neighbours just installed an oversized system (on the advice of some “expert” or should I say con artist, door knocking salesman). Because they are not at home during most of the day, most of their solar generated electricity are exported to the grid while they still use a lot of electricity at night for water heating purpose. Their quarterly bills don’t drop noticeably and the reward for their massive export per quarter is a princely $60 or $240 pa. Now they told me their payback will be decades because of wrong solution, sizing and configuration. I don’t even know the quality of their panels, inverter, installation workmanship or warranties. I wish they have done more homework to satisfy themselves before plunging in but it is too late now……….


        • Ronald Brakels says

          As the solar thermal hot water system will only receive power from tariff 31, having it connected to tariff 31 is permissible. Solar systems, both PV and solar thermal hot water, still work well in winter. I don’t know where you are, but if you are in the Ergon area then in the worst month of the year a solar PV panel will typically produce 75% or more of the average output it will produce in the best month. While periods of cloudy weather and high hot water use will normally require grid electricity be used at times, thermal solar hot water systems can still provide the bulk of the energy required to heat water in winter. The output of solar systems is much more consistent in Queensland than places such as South Australia.

  21. Hi Finn,

    Just wondering:-

    1) For central inverter (string panel array) with individual panel optimization using DC optimizer – does shading of one panel affect the performance of all the other panels?

    2) With increased fire/safety risk from solar installation, will the home insurance premium be increased?

    3) Is there any health risk bringing power generation/transmission so close to home?

    4) Will it be safe to clean or paint the roof once the solar PV are installed?

    5) If my energy bill is not that much (about $200 per qtr excluding daily supply charges), is it a good idea to wait a while until the AC Solar PV with Micro Inverter technology matures a bit more and prices come down further before i go solar (I like to get things right the first time). After researching further, I feel the Micro inverter option is much SAFER. I also prefer it because it is more ROBUST (less chance of PID, points of failure) and has REDUNDANCY.

    • Ronald Brakels says

      Hello Steven, Ronald here.

      1. Panels that have DC optimisers won’t affect other panels in a string if their individual performance declines.
      2. When you put solar panels on your home insurance it might go up because your insurance is covering more, but the fire risk is no different from getting any other large electrical appliance. Actually, it’s less than many electrical items, so it won’t increase your insurance for that reason.
      3. If you are happy with the risk of having electrical appliances in your house or typing on a laptop then having solar panels on your roof is not a problem.
      4. it’s definitely safe to clean the roof. If you are determined to do a really thorough job when painting the roof you should have a professional remove the panels so you can paint underneath them. But since people can’t see the roof under the panels, you can just cover them and work around them. Of course, you definitely do not want to get paint on the panels. Any paint on them will need to be carefully removed.
      5. Electricity prices have just jumped and feed-in tariffs are up as well, so personally I would not wait. Even though microinverters entail extra cost, you may find the savings are now large enough to enable you to finance a large system. Also, an advantage of microinverters is it is not difficult to add more later if you can’t afford all you want now.

  22. Steve Thomas says

    I have had a Solar hot water system on the roof for the last 15 years panels on roof storage on the ground, and last month had a 5 KW solar system fitted to the house, is it better to leave the hot water on off peak or contact the electricity supplier to turn it off,?

    Steve Thomas

    • Ronald Brakels says

      Hi Steve

      It will depend on where you are. If the price of off-peak electricity is lower than your feed-in tariff it definitely makes sense to leave your hot water system on off-peak power. You can put a timer on your hot water system so it will only turn on during the day, but there is a good chance it will still use a considerable amount of peak electricity:

      Installing hot water diverter that will use surplus solar electricity to heat water is an option, but costs considerably more:

      But because it is a solar hot water system that presumably doesn’t use much electricity, it may be easiest to just leave it as it is and consider what changes to make if and when it needs replacing.

  23. Need a bit of help! We’re in SA and need to add Solar PV and a new hot water service. We don’t have have gas connected to the house.

    I’m looking to add a 5kw Solar PV (oversized to about 6.2kw) and the installer recommended using our East and West facing roof space. We’re only on single phase power so I think 5kw is the biggest we can go?

    This would leave the north face free. Is it still better to go with a Solar Hot Water system (evac tubes?) or increase the number of panels? If we increased the number of panels, can we get a bigger inverter on single phase power?


    • Ronald Brakels says

      Hi Ben

      Usually with single phase power you can only install a maximum of 5 kilowatts of inverter capacity and up to 6.66 kilowatts of panel capacity. It is possible to go over this by export limiting your system to 5 kilowatts but this is an extra expense. Also, string inverters can normally only accept panels facing in two different directions — in your case east and west. This can be worked around by using microinverters, optimizers, or panel string optimized panels (if they are currently available). But again, this is likely to cost more.

      So if you want a larger system you’ll have to pay for a system that can export limit and if there isn’t room for all the extra panels you want on the east and west facing portions of the roof you’ll have to pay extra to get around that. Extra solar panels definitely can be a cheaper option than a solar hot water system these days, but maybe not in this case.

      • Thanks, Ronald!

        I guess the question for us will be about electric boosted solar thermal vs heat pump.

        I’ve tried to wrapped my head around it but I seem to be going in circles a bit. From what I understand, the options I should be looking at for the Adelaide region are:

        Electric boosted evacuated tube on a controlled load tariff


        Heat pump either on controlled load tariff or timed for max solar PV output.

        Does this sound about right? Coupled with the solar panels, should I be looking out for anything else to help with the decision?

        • Ronald Brakels says

          Here’s an article I wrote on heat pump hot water:

          Unfortunately, the warranties for heat pump hot water systems often aren’t great and so you may want to get solar hot water for its better reliability.

          In South Australia a controlled load tariff for hot water is around 18 cents a kilowatt-hour. So if you have a high solar feed-in tariff it may be cheaper to put whatever hot water system you get on a controlled load. This is because if it is not on a controlled load it may sometimes draw grid electricity during the day if PV output isn’t high enough. I wrote about this here:

          If you have an existing hot water system you can use that in conjunction with a solar hot water system and so that is a consideration.

  24. Heat pumps? Noisy bl00dy things. We have many SHWs… and just ONE SHP. One too many!~

  25. “The embodied energy of the solar water heater is much less than that of 8 solar panels.”
    How was that calculated, please?

    • Ronald Brakels says

      I don’t know what figures Finn used but there are estimates of embodied energy for solar panels on the internet. However, it’s likely to be more difficult to find them for solar hot water heaters. But the way I would look at it is, a solar hot water heater might cover around 6 square meters while 8 solar panels is about twice that at 13 square meters. Both have tough, hail resistant glass on front. The solar hot water system has plumbing while the solar panel has an energy intensive layer of silicon and wiring, so to me it looks to me like the much greater area of the 8 solar panels would require considerably more embodied energy.

  26. Our electric HW storage system is about to go – small leak. Been looking at a replacement. The Chromagen looks interesting at the price.

    Is there a heat exchange tank that will also accept solar, that is a heat exchange coil PLUS a solar coil.

  27. Hi
    Is there an update to this comparison for 2020? Given the movement in cost of PV now and (hopefully) technical efficiency I’d like to understand how this looks now as I’m considering a pV system and possibly using it to replace a dying solar hot water system at the same time.

    • Ronald Brakels says

      Hi Paul

      Generally speaking, it will be more cost effective to install a PV solar system with plenty of capacity and run an electric hot water system or heat pump hot water system than to replace an old solar hot water system. But I will mention some people like having solar hot water systems because they will provide hot water during blackouts or because they are up against limits in how much solar PV they are permitted to install.

      • Good points, Ron.

        The only disadvantage of solar heat pumps is they’re noisy.

        Recently, we replaced a dying solar hot water system, 32 years old, with a new state-of-the-art solar hot water system. We’re amazed at the efficiency of the new SHWS. We don’t have an electric booster… and we don’t need one.

        SHWS technology has certainly improved in three decades… although I guess it would be disappointing if it hadn’t improved measurably.

        • Ronald Brakels says

          Yes, noise is definitely a consideration that is often overlooked. But I suppose an increasing number will end up being operated in the middle of the day with increased solar uptake and things like South Australia’s Solar Sponge tariff and controlled load.

  28. Catherine says


    We’ve had a 3.15kW system for 2years and also installed a 2.98kW battery in the last 6months, which is great in giving instant feedback on electricity usage, grid, feedback etc..

    In your article you mentioned “ Just be sure your installer knows how to set up your hot water system to draw 70-80% of its electricity from the solar panels”

    Im monitoring the load when showering and doesnt seem to change, hence I think it may not be set up to do so.

    My question is, how would I know exactly if the installer did just that?

    • Ronald Brakels says

      Hi Catherine, Ronald here.

      This may sound a little obvious, but the first thing to do is check your electricity bill to see if you are paying for a controlled load. That will almost certainly be for your hot water system. If you are receiving a high solar feed-in tariff you may want to keep it because if your feed-in tariff is close to what you are paying for the controlled load for your hot water system it save you money compared to putting your hot water system on a timer to switch on during the day. As your solar system is not especially large, there is a good chance you’ll be better off with your hot water system on a controlled load.

      To check if you already have a timer that switches on your hot water system during the day you can check if there is one on your switch board. If you weren’t charged for one when you had your solar installed, then you almost certainly won’t have a hot water timer. If you don’t have a hot water timer you can get one installed by an electrician. (I recommend one you can adjust yourself.) If you have a high hot water use you could install a hot water diverter.

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