Solar hot water systems are effective in saving money and energy for consumers while reducing carbon emissions. The purchase of solar hot water technology also supports domestic manufacturing businesses and Australian jobs.

Solar water heating can refer to either a stand-alone solar hot water system or a heat pump, which heats water using energy from the ambient air.

A stand-alone solar hot water system uses collectors on the roof to capture heat. Solar hot water systems with a 'booster' use either natural gas or electricity from the grid as backup to ensure a reliable supply of hot water. Booster systems are much more cost-efficient to run than a standard gas or electric system.

Heat pumps use a small amount of electricity to run a pump, which circulates a refrigerant around the system. This refrigerant picks up heat from the air and transfers it to the stored water. Heat pumps are significantly more efficient than a conventional electric water heater.

Electrical water heating is the largest single source of greenhouse gases from the average Australian home, producing almost a quarter of household emissions.

Installing a solar water heating system will reduce the average household's carbon emissions by 2.4 to 3 tonnes. It can also save residents hundreds of dollars every year compared to an electric hot water system.

Solar water heating in Australia: 2017 in focus

Installation of a thermosiphon

Installation of a thermosiphon

Approximately 45,000 solar water heating systems were installed during 2017, taking the total installed across the country to almost 1.1 million units.

The trend of declining solar water heating installations continued in 2017, with the number of systems installed falling by more than 25 per cent compared to 2016. 

The solar water heating market peaked in 2009, when the Federal Government's $1600 rebate for the installation of a system resulted in almost 200,000 systems being installed.

In 2017, Victoria overtook both New South Wales and Queensland to become the state with the highest number of total solar water heater installations. Installation numbers have remained relatively steady in Victoria since 2009, but have dropped off significantly in New South Wales and Queensland. In New South Wales, installations have fallen from over 85,000 in 2009 to just 6000 in 2017.

Cumulative solar water heater installations in Australia

2017 1,077,079
2016 1,031,743
2015 969,843
2014 911,139













The future of solar water heating in Australia

Solar water heating is a proven technology that reduces greenhouse emissions and saves consumers money on their electricity bills.

The uptake of solar water heating has levelled off in recent years due to shrinking Federal and State Government rebates. Nevertheless, the rising cost of electricity will make switching to solar hot water a very attractive prospect for many households.


  • SunWiz Consulting, 2013
  • Clean Energy Council Solar Hot Water and Heat Pump Study, Mito Energy, 2011
  • Clean Energy Australia Report 2018