Instant Gas vs Electric Hot Water Systems: Which Is Better?

Choosing between instant gas and electric hot water depends on your home’s energy source, household size, number of bathrooms, available space, budget, gas supply, electrical requirements and whether you prefer continuous flow hot water or a storage tank system. Instant gas and electric hot water systems work very differently, so the better option depends on the property.

At Hot Water Outlet, you can compare instant gas hot water systems, electric hot water systems, heat pump hot water systems, hot water systems, gas hot water systems and common valves, pipework and fittings.

Quick Answer: Is Instant Gas or Electric Hot Water Better?

Instant gas hot water is usually better if your home already has natural gas or LPG, you want continuous flow hot water, and the selected flow rate in L/min suits your household demand.

Electric hot water is usually better if your home does not have gas, already uses electric storage, or you want a straightforward tank-style replacement.

As a general guide:

• Choose an instant gas hot water system if natural gas or LPG is available and continuous flow hot water suits the home.

• Choose an electric hot water system if the property already has electric storage and a tank-style replacement is preferred.

• Choose a heat pump hot water system if you want an efficient electric storage option and the property has suitable outdoor space and airflow.

• Choose instant gas by flow rate in L/min.

• Choose electric storage by tank capacity in litres.

• Confirm natural gas or LPG before ordering instant gas.

• Check electrical requirements before ordering electric hot water.

The better option is usually the one that matches the home’s existing services. If the property already has gas, instant gas may be worth comparing. If the property is electric-only, electric storage or heat pump hot water will usually be the more practical comparison.

Instant Gas vs Electric Hot Water at a Glance

Both options can work well. The wrong choice is usually the system that does not suit the property’s energy source, location or hot water demand.

What Is Instant Gas Hot Water?

An instant gas hot water system heats water as it passes through the unit. It does not store hot water in a tank.

Instant gas is also called continuous flow gas hot water.

Instant gas systems are sized by flow rate in L/min, with common options including:

• 16 L/min

• 20 L/min

• 26 L/min

Instant gas may suit homes where:

• Natural gas or LPG is already available

• Continuous flow hot water is preferred

• A compact external wall-mounted unit suits the property

• The selected flow rate matches household demand

• Gas supply and water pressure are suitable

• The correct natural gas or LPG model is chosen

Instant gas can be a strong option for many homes, but it must be matched to gas type, flow demand and property suitability.

What Is Electric Hot Water?

An electric hot water system uses electricity to heat water. The most common whole-home electric option is electric storage, where water is heated and stored in a tank.

Electric storage systems are sized by tank capacity in litres.

Electric hot water may suit homes where:

• Natural gas or LPG is not available

• The current system is electric storage

• A tank-style replacement is preferred

• The selected tank size suits household demand

• The existing tank location works

• A straightforward replacement is preferred

Electric hot water can also include instant electric systems for specific point-of-use applications, but most whole-home electric comparisons are between electric storage and heat pump hot water.

Main Difference Between Instant Gas and Electric Hot Water

The main difference is how the water is heated and delivered.

Instant gas heats water on demand using natural gas or LPG.

Electric storage heats water using electricity and stores it in a tank.

Instant gas and electric storage should not be compared by litres alone. They are different system types with different sizing methods.

Instant Gas Hot Water Pros

Instant gas can be a good choice when the home has suitable gas supply and the system is correctly sized.

Benefits may include:

• Continuous flow hot water where correctly sized

• Compact external wall-mounted design

• No large storage tank

• Available in different flow rates

• Good option where natural gas or LPG is already available

• Commonly compared for family homes and two-bathroom homes

• Can suit homes where a storage tank is not preferred

Instant gas is often worth comparing when the existing system is already gas or the household wants continuous flow hot water.

Instant Gas Hot Water Cons

Instant gas is not suitable for every home.

Potential drawbacks include:

• Requires natural gas or LPG

• Natural gas and LPG models are not interchangeable

• Gas supply must suit the selected unit

• Flow rate must match household demand

• Water pressure and flow can affect performance

• A lower-flow unit may not suit larger homes

• External location requirements must be suitable

• Gas and plumbing work must be completed by licensed tradespeople

The main mistake is choosing instant gas by price alone without checking gas type, flow rate and peak household demand.

Electric Hot Water Pros

Electric hot water can be practical, especially where the home already uses electric storage.

Benefits may include:

• Suitable for homes without gas

• Common in units, townhouses and detached homes

• Familiar tank-style system

• Wide range of tank sizes

• Often practical for like-for-like electric tank replacement

• No need to choose between natural gas and LPG models

• Can be compared with heat pump options for efficient electric storage

Electric storage is usually the simpler option when the property is already set up for electric hot water.

Electric Hot Water Cons

Electric hot water may not suit every household or goal.

Potential drawbacks include:

• Stored hot water can run out if the tank is undersized

• Larger tanks need more space

• Standard electric storage may not be the most efficient electric option

• Electrical requirements must suit the property

• Recovery rate matters for back-to-back use

• Heat pump upgrades need outdoor space and airflow

• Electric storage does not provide continuous flow in the same way as instant gas

The main mistake is replacing an old electric tank with the same size without checking whether household demand has changed.

Instant Gas vs Electric Storage

Instant gas and electric storage are the most common comparison people mean when searching instant gas vs electric hot water.

Instant gas may be better where gas is already available and continuous flow suits the household.

Electric storage may be better where the home has no gas or already uses electric storage.

Instant Gas vs Heat Pump Hot Water

A heat pump is an electric hot water system, but it is different from standard electric storage. It uses electricity to draw heat from the surrounding air and transfer it into stored water.

Instant gas may suit homes already using gas.

Heat pump hot water may suit homes wanting efficient electric storage where outdoor space and airflow are suitable.

Instant Gas vs Instant Electric Hot Water

Instant gas and instant electric systems both heat water as it passes through the unit, but they are not interchangeable.

Instant gas is commonly used for whole-home continuous flow hot water where natural gas or LPG is available and the selected flow rate suits the home.

Instant electric is usually used for specific point-of-use applications.

Instant electric may suit:

• A hand basin

• A kitchenette

• A small localised hot water need

• A remote fixture

• A low-flow application where electrical requirements match

Instant electric should not be treated as a direct whole-home replacement for instant gas unless the product is specifically designed for the intended demand and the property can support it.

Which Is Cheaper: Instant Gas or Electric Hot Water?

The cheaper option depends on the product type, size, brand, energy source, required accessories and whether you are comparing supply-only pricing or full installed cost.

Instant gas pricing depends on:

• Flow rate in L/min

• Brand

• Natural gas or LPG model

• Controller compatibility

• Product specifications

• Required valves and fittings

Electric hot water pricing depends on:

• Tank capacity

• Brand

• Power requirements

• Recovery rate

• Product dimensions

• Required valves and fittings

Heat pump pricing depends on:

• Tank capacity

• Brand

• Heat pump design

• Product specifications

• Rebate eligibility where relevant

• Location suitability

Hot Water Outlet sells supply-only hot water systems and accessories online. Supply-only pricing usually does not include installation, plumbing, gas fitting, electrical work, disposal, valves, fittings, pipework changes or compliance upgrades unless clearly stated.

Which Has Lower Running Costs: Instant Gas or Electric?

Running costs depend on gas tariffs, electricity tariffs, household use, system size, product efficiency, installation quality and how well the system suits the home.

As a general guide:

• Instant gas heats water on demand using natural gas or LPG.

• Standard electric storage heats and stores water in a tank.

• Heat pump hot water is often compared as a more efficient electric storage option.

• Oversized or undersized systems can reduce value.

• Poor sizing can lead to higher usage or poor performance.

Do not choose based only on running cost assumptions. The system must suit the property and household demand.

Which Is Better for Energy Efficiency?

Heat pump hot water is usually the main electric option compared for efficiency. Standard electric storage is usually simpler but may not offer the same efficiency potential as a heat pump.

Instant gas may be efficient for homes already using gas and wanting continuous flow, but suitability depends on gas type, flow rate and household usage.

When comparing efficiency, consider:

• Energy source

• Household hot water demand

• System type

• Tank size or flow rate

• Heat pump airflow

• Gas supply suitability

• Energy tariffs

• Usage habits

• Product specifications

The most efficient option on paper may still be the wrong choice if it does not suit the property.

Instant Gas vs Electric for Small Homes

Small homes can suit either instant gas or electric hot water depending on what is already available.

Instant gas may suit a small home if:

• Natural gas or LPG is already available

• A compact wall-mounted unit is preferred

• One bathroom is used most of the time

• A 16 L/min or 20 L/min model suits demand

• External wall location is suitable

Electric hot water may suit a small home if:

• Gas is not available

• The current system is electric storage

• A compact tank fits the property

• A heat pump is not practical

• A straightforward replacement is preferred

A small home should not automatically choose the smallest system. Shower habits, bath use and laundry demand still matter.

Instant Gas vs Electric for Units

Units often have space and building restrictions, so the existing system type is usually the best starting point.

Instant gas may suit a unit if:

• The building already supports gas hot water

• Natural gas or LPG is confirmed

• External location requirements can be met

• Body corporate or building rules allow the unit

• The selected flow rate suits demand

Electric hot water may suit a unit if:

• The unit already uses electric storage

• Gas is not available

• A compact tank fits the current space

• Body corporate rules restrict external gas equipment

• A simple replacement is preferred

Heat pumps may suit some units only where outdoor space, airflow, drainage, noise and body corporate requirements allow.

Instant Gas vs Electric for Townhouses

Townhouses may suit either instant gas or electric storage depending on services and layout.

Instant gas may suit a townhouse if:

• Natural gas or LPG is already available

• A compact external wall-mounted unit fits

• A 20 L/min or 26 L/min unit suits demand

• Gas supply can support the system

• Body corporate or complex rules allow it

Electric hot water may suit a townhouse if:

• The current system is electric storage

• A tank fits in the garage, cupboard, courtyard or service area

• Gas is not available

• Heat pump location is not suitable

• A straightforward replacement is preferred

For townhouses, space, access, neighbours and outdoor location need to be considered.

Instant Gas vs Electric for Family Homes

Family homes usually need more careful hot water sizing because peak demand can be high.

Instant gas may suit a family home if:

• Natural gas or LPG is available

• Continuous flow hot water is preferred

• A 20 L/min or 26 L/min system suits demand

• Two bathrooms may be used close together

• Gas supply and water pressure are suitable

Electric hot water may suit a family home if:

• The home already uses electric storage

• A larger tank can fit

• Gas is not available

• A heat pump location is suitable

• Tank capacity matches daily use

For families, the best choice depends on bathrooms, shower habits, bath use and peak morning or evening demand.

Instant Gas vs Electric for One Bathroom

A one-bathroom home may suit either instant gas or electric hot water.

Instant gas may suit if:

• Natural gas or LPG is available

• A 16 L/min or 20 L/min system suits demand

• A compact external unit is preferred

• The household wants continuous flow hot water

Electric hot water may suit if:

• The home already uses electric storage

• A compact or medium tank suits demand

• Gas is not available

• The household wants a tank-style system

One bathroom does not always mean low demand. A one-bathroom family home may still need a capable system.

Instant Gas vs Electric for Two Bathrooms

Two-bathroom homes need more careful sizing because demand may overlap.

Instant gas may suit two bathrooms if:

• Natural gas or LPG is available

• A 20 L/min or 26 L/min model suits demand

• Gas supply and water pressure are suitable

• Two showers may run close together

• Continuous flow hot water is preferred

Electric hot water may suit two bathrooms if:

• A medium to larger storage tank suits demand

• Heat pump capacity suits the household

• The property has no gas

• The current electric tank location works

For two bathrooms, do not choose by energy source alone. Compare storage capacity, recovery rate and instant gas flow rate.

Instant Gas vs Electric for Rental Properties

Rental properties need a practical system that suits likely tenant demand.

Instant gas may suit a rental if:

• Natural gas or LPG is available

• The selected flow rate suits the number of bedrooms and bathrooms

• A compact external unit is practical

• Existing gas services are suitable

Electric hot water may suit a rental if:

• The property already uses electric storage

• A like-for-like tank replacement is preferred

• Gas is not available

• Tank capacity suits likely tenant demand

• The location is simple and reliable

Avoid undersizing rental hot water. A cheaper system may create tenant complaints if it cannot keep up.

Instant Gas vs Electric for Renovations

Renovations are a good time to reassess hot water because household demand and system location may change.

Instant gas may suit a renovation if:

• Natural gas or LPG is available

• A wall-mounted external unit suits the new layout

• A second bathroom is being added

• Continuous flow hot water is preferred

• Gas supply can support the selected flow rate

Electric hot water may suit a renovation if:

• The home is already electric

• A larger storage tank is needed

• A heat pump location can be planned

• Gas is not available or not preferred

• Electrical requirements can be met

Plan the hot water system around the finished home, not the old layout.

Instant Gas vs Electric With Solar Power

Some homeowners compare instant gas and electric hot water because they already have solar power or are planning more electric appliances.

Electric hot water may be worth comparing with solar where:

• The system type suits the household

• The product supports the intended setup

• A timer or control arrangement is suitable

• The home has enough hot water storage

• Licensed tradespeople confirm electrical suitability

Heat pump hot water may also be worth comparing as an efficient electric storage option where outdoor space and airflow are suitable.

Instant gas may still suit homes that already use natural gas or LPG and want continuous flow hot water.

Do not assume solar automatically makes one option best. Tariffs, timing, product suitability and household demand all matter.

Replacing Electric Hot Water With Instant Gas

Replacing electric hot water with instant gas may be worth comparing only if natural gas or LPG is available and the property suits gas hot water.

Before changing from electric to instant gas, check:

• Natural gas or LPG availability

• Gas supply suitability

• External wall location

• Number of bathrooms

• Required flow rate in L/min

• Water pressure and flow

• Product dimensions

• Required valves and fittings

• Licensed gas fitting requirements

If gas is not already available, electric storage or heat pump hot water may be more practical to compare.

Replacing Instant Gas With Electric Hot Water

Replacing instant gas with electric hot water may be considered if the property wants to move away from gas or if electric storage suits the home better.

Before changing from instant gas to electric, check:

• Electrical requirements

• Tank location

• Available space

• Household hot water demand

• Whether heat pump is suitable

• Outdoor airflow if choosing heat pump

• Required valves and fittings

• Product dimensions

• Licensed electrical requirements

Changing energy source can involve extra plumbing, gas or electrical work, so suitability should be checked before ordering.

Natural Gas vs LPG

If choosing instant gas, gas type must be confirmed before ordering.

Instant gas systems may be:

• Natural gas

• LPG

Natural gas and LPG systems are not interchangeable.

Before ordering, check:

• Current gas hot water unit label

• Gas meter

• LPG bottle setup

• Existing appliance details

• Product listing gas type

• Licensed gas fitter advice if unsure

Choosing the wrong gas type can cause delays and extra costs.

Gas Supply and Water Pressure

Instant gas performance depends on more than the unit itself. Gas supply and water pressure both matter.

Before choosing instant gas, check:

• Existing gas line sizing

• Distance from gas supply

• Other gas appliances

• Regulator setup

• Water pressure

• Shower flow rates

• Number of outlets

• Whether multiple fixtures run together

• Product specifications

A larger instant gas unit may not perform properly if the property cannot support it. A licensed gas fitter or plumber should assess the setup where needed.

Electric Tank Size and Recovery Rate

Electric storage performance depends on tank capacity and recovery rate.

Before choosing electric storage, check:

• Current tank capacity

• Whether the old system runs out

• Number of occupants

• Number of bathrooms

• Shower habits

• Bath use

• Laundry demand

• Kitchen demand

• Recovery rate

• Power requirements

• Product dimensions

A small electric tank may suit a low-demand home. A family home may need a medium to larger tank or a suitable heat pump.

Heat Pump as an Electric Alternative

If you are comparing instant gas and electric hot water, include heat pump hot water in the electric options.

A heat pump may be worth comparing if:

• The home currently uses electric storage

• Efficient electric hot water is preferred

• Outdoor space is available

• Airflow is suitable

• Noise can be managed

• Condensate drainage can be handled

• Tank capacity suits daily demand

A standard electric tank may be more practical if:

• Outdoor heat pump space is not suitable

• Upfront product price is the main priority

• A simple like-for-like replacement is preferred

• The property is compact or restricted

Space and Location Requirements

Instant gas and electric hot water have different space requirements.

Instant gas usually needs:

• External wall space

• Gas and water connection access

• Suitable clearances

• Controller wiring where relevant

• Power connection where required

• Access for licensed tradespeople

Electric storage usually needs:

• Tank footprint

• Suitable base or location

• Power supply

• Water connection access

• Drainage

• Access for delivery and replacement

Heat pump hot water usually needs:

• Outdoor space

• Airflow

• Condensate drainage

• Noise planning

• Electrical supply

• Access for delivery and servicing

The best system is the one that fits the home properly.

Valves, Fittings and Accessories

Instant gas and electric hot water systems may need valves, fittings or accessories as well as the main unit.

Common items include:

• Tempering valves

• Pressure relief valves

• Duo valves

• Non-return valves

• Isolation valves

• Copper pipework

• Fittings

• Controller accessories

• Thermostats

• Elements

• Connection parts

Hot Water Outlet has a dedicated range of valves, pipework and fittings to help customers compare common hot water accessories.

Always confirm compatibility before ordering.

Common Mistakes When Comparing Instant Gas and Electric Hot Water

Choosing by Price Alone

A cheaper system may not suit the home’s energy source, demand## Common Mistakes When Comparing Instant Gas and Electric Hot Water

Choosing by Price Alone

A cheaper or connection requirements.

Ignoring Gas Availability

Instant gas requires natural gas or LPG. If gas is not available, electric storage or heat pump hot water may be more practical.

Choosing the Wrong Gas Type

Natural gas and LPG systems are different. Always choose the correct model.

Choosing Too Low an Instant Gas Flow Rate

A 16 L/min unit may not suit larger homes, two bathrooms or overlapping hot water demand.

Choosing Too Small an Electric Tank

A compact electric tank may run out quickly in a family home.

Comparing Litres and L/min Incorrectly

Electric storage uses tank litres. Instant gas uses L/min flow rate.

Forgetting Heat Pump Options

If staying electric, heat pump hot water may be worth comparing where location and budget suit.

Forgetting Valves and Fittings

The main system may not be the full order. Accessories may also be required.

Instant Gas vs Electric Hot Water Buyer Checklist

Before choosing between instant gas and electric hot water, check:

• Current hot water system type

• Current brand and model

• Current tank capacity or flow rate

• Whether the current system keeps up

• Electricity, natural gas or LPG

• Number of people in the home

• Number of bathrooms

• Number of showers per day

• Whether outlets are used at the same time

• Bath use

• Kitchen hot water use

• Laundry use

• Desired system type

• Flow rate in L/min if instant gas

• Tank capacity if electric storage

• Heat pump tank capacity if comparing heat pump

• Gas supply suitability if choosing instant gas

• Water pressure and flow

• Power requirements if choosing electric

• Heat pump airflow if relevant

• Heat pump noise rating if relevant

• Product dimensions

• Connection positions

• Required valves and fittings

• Delivery access

• Warranty information

• Product specifications

Compare Instant Gas and Electric Hot Water Online

Hot Water Outlet makes it easier to compare instant gas and electric hot water systems by type, size, energy source, brand and product specifications.

Start with:

• Instant Gas Hot Water Systems

• Electric Hot Water Systems

• Heat Pump Hot Water Systems

• Gas Hot Water Systems

• Hot Water Systems

• Valves, Pipework and Fittings

FAQs About Instant Gas vs Electric Hot Water

Is instant gas better than electric hot water?

Instant gas may be better if the home already has natural gas or LPG, continuous flow hot water is preferred, and the selected flow rate suits demand. Electric hot water may be better if the home has no gas or already uses electric storage.

Is electric hot water better than instant gas?

Electric hot water may be better where gas is not available, a tank-style replacement is preferred, or the property already uses electric storage. Heat pump hot water may also be worth comparing as an efficient electric option.

Is instant gas cheaper than electric hot water?

Product and running costs depend on system size, brand, gas type, electricity tariff, gas tariff, usage and replacement requirements. Compare the full situation, not just the product price.

Does instant gas run out of hot water?

Instant gas does not run out of stored hot water because it does not use a storage tank. However, the flow rate still needs to match household demand.

Can electric hot water run out?

Yes. Electric storage hot water can run out if the tank is undersized or household demand is high. Recovery rate affects how quickly more hot water is heated.

Is 16L instant gas enough compared with electric storage?

A 16 L/min instant gas system may suit smaller homes with lower demand. It may not suit families, two bathrooms or overlapping hot water use.

Should I replace electric hot water with instant gas?

Only if natural gas or LPG is available and the property suits instant gas. Gas supply, water pressure, external location and flow rate should be checked before ordering.

Should I replace instant gas with electric hot water?

This may be worth comparing if the property wants to move away from gas or if electric storage or heat pump hot water better suits the home. Electrical requirements and tank location need to be checked.

Are instant electric and instant gas the same?

No. Instant gas uses natural gas or LPG and is commonly used for whole-home continuous flow where suitable. Instant electric uses electricity and is often best suited to specific point-of-use applications.

Can I install instant gas or electric hot water myself?

No. Hot water systems involve plumbing, gas and electrical work that should be completed by appropriately licensed tradespeople. Hot Water Outlet sells supply-only hot water systems and accessories online, and may help organise quotes from reputable installers where appropriate.

Find the Right Instant Gas or Electric Hot Water System

The right choice between instant gas and electric hot water depends on your energy source, household demand, available space and replacement setup. Instant gas may suit homes with natural gas or LPG that want continuous flow hot water. Electric storage may suit homes without gas or replacing an electric tank. Heat pump hot water may suit homes wanting efficient electric storage where outdoor space and airflow are suitable.

Browse instant gas hot water systems, electric hot water systems and heat pump hot water systems online with Hot Water Outlet to compare hot water options by brand, size and product specifications.