Gas vs heat pump hot water in Perth: what each costs to run

Hot water is one of the biggest energy loads in a Perth home, and it runs every day of the year. So when a gas system is ageing, the question is simple: does a heat pump cost less to run? For most homes, yes, by a wide margin. It costs more to buy, and the federal certificates take part of that off. Here's how the numbers work.

Is a heat pump cheaper to run than gas hot water?

Yes, in most Perth homes. In the model behind our calculator, a gas storage system burns about 16,000 MJ of gas a year. At the standard WA rate of about 5.3c per MJ, that's around $850. A heat pump doing the same job uses about 900 kWh of electricity, costing roughly $300 a year on Synergy's flat A1 rate.

Discounted gas plans bring the gas figure down, but it stays above the heat pump. These are modelling figures, not a reading of your house. Your own gas bill shows the megajoules (MJ) you use, and hot water is usually the largest share. A small household or a newer gas unit will burn less.

The gap comes from how each one makes heat. A gas system burns fuel and loses some of the heat up the flue. A heat pump moves heat out of the outside air into the tank, giving about three units of heat or more for every unit of electricity it uses.

How much does timing change the heat pump's running cost?

A lot. Run the heat pump only in Synergy's Midday Saver window, from 9am to 3pm at 8.85c/kWh, and the same 900 kWh costs about $80 a year. The catch is the 3pm to 9pm peak at 55.33c/kWh and a higher daily supply charge than A1, so the plan suits homes that can move other loads into daytime too.

With rooftop solar, set the timer for the middle of the day and the tank heats from power you'd otherwise export. Under DEBS, midday exports earn 2c/kWh, so heating from your own surplus gives up only around $20 a year in export credits. Gas can't use your solar at all.

Our hot water timer guide walks through the settings.

What does the fixed gas charge add?

Every gas account pays a fixed daily charge just to stay connected. It's printed on your gas bill. If hot water is your only gas appliance, swapping it for a heat pump lets you have the meter removed, and that charge ends too. If you still cook or heat with gas, the charge stays until the last gas appliance goes.

That's why the hot water swap often pays back fastest in homes where it's the last thing on gas. Our guide to disconnecting gas covers the one-off fee for removing the meter.

How much do the federal certificates take off a heat pump?

A typical heat pump replacing a gas or electric system earns about 23 small-scale technology certificates (STCs). At October 2026 prices, that's roughly $850 to $870 off. Most installers take the certificates and discount the quote, so check the discount appears as its own line.

The count depends on the model and where you live, and the certificate price moves, so the figure on your quote can differ. Ask whether any other incentive applies in WA when you buy. A heat pump still costs more upfront than a like-for-like gas tank. Against that, you're choosing the lower running cost for the life of the system.

When does gas hot water still make sense?

When gas is staying in the house for other reasons and the hot water rides on a connection you'd keep anyway. Working gas ducted heating you rely on, or heavy gas cooking, are the usual examples. Even then, a heat pump usually wins on running cost. The difference is that you don't get the fixed-charge saving as well.

If your gas system is near the end of its life, compare a heat pump with a new gas unit, not with doing nothing. Our heat pump hot water guide covers sizing, choosing a system and getting quotes. To run the comparison on your own usage, the BillWise calculator takes your current hot water type and works out the saving for your home.

Frequently asked questions

Does a heat pump work in Perth's winter?

Yes. Heat pumps pull warmth from the outside air, and Perth winters are mild, so there's usable heat in the air nearly all year. Output eases a little on cold mornings, which is one more reason to set the timer for the middle of the day, when the air is warmest.

Is it worth replacing a gas hot water system that still works?

Often it's better to plan the swap and make it when the gas unit is near the end of its life. Then you're comparing a heat pump with a new gas system you'd have to buy anyway, not with keeping the old one, and the gap is much smaller.

Sources

• Clean Energy Regulator, "Solar water heaters and air source heat pumps", https://cer.gov.au/schemes/renewable-energy-target/small-scale-renewable-energy-scheme/small-scale-renewable-energy-systems/solar-water-heaters-and-air-source-heat-pumps.
• Department of Climate Change, Energy, the Environment and Water, Your Home, "Hot water systems", https://www.yourhome.gov.au/energy/hot-water-systems.
• Synergy, "Synergy price changes 2026", https://www.synergy.net.au/Global/Synergy-Price-Changes-2026.
• Energy Policy WA, "Household gas pricing", https://www.wa.gov.au/organisation/energy-policy-wa/household-gas-pricing.