Gas Storage vs Continuous Flow: Which Costs Less to Install?
Installed prices for gas storage and continuous flow hot water systems compared, plus when the higher upfront cost of continuous flow pays off.
A gas hot water system typically costs $1,650 – $2,750 installed, but the two gas types aren't priced the same: a gas storage tank runs $2,100, while a continuous flow (instant) unit runs $2,250. The gap comes down to what's involved in the swap, not just the appliance.
Installed cost by type
| Type | Typical installed cost | What's driving the price |
|---|---|---|
| Electric storage (250-315 L) | $1,600 | Like-for-like tank swap, simplest job |
| Gas storage (135-170 L) | $2,100 | Tank swap plus gas connection check |
| Continuous flow gas (20-26 L/min) | $2,250 | Unit cost, flueing, often a larger gas line |
For the full breakdown of every option against typical cost, usual range and expected lifespan, see
| Material | Typical | Usual range | Lifespan |
|---|---|---|---|
| Electric storage (250-315 L) | $1,600 | $1,250 – $2,100 | 8-12 years |
| Gas storage (135-170 L) | $2,100 | $1,650 – $2,750 | 8-12 years |
| Continuous flow gas (20-26 L/min) | $2,250 | $1,750 – $2,950 | 12-20 years |
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Why continuous flow costs more upfront
A gas storage tank is a direct replacement: old unit out, new one in, same fittings in most cases. A continuous flow unit is a different kind of appliance — it heats water on demand rather than storing it, so installers often need to check (and sometimes upgrade) the gas supply line to the unit, since instant systems draw more gas at peak flow than a storage tank does. Wall-mounted continuous flow units also need a compliant flue termination point, which can mean extra flashing or ducting work on brick or cladded walls that a tank swap never touches.
That's the main reason a continuous flow swap tracks toward the top of its price band more often than a gas storage swap does. If your existing gas line and flue position already suit a continuous flow unit — for example, you're replacing an existing continuous flow system — the job is closer to a straight swap and the price sits nearer the lower end of $2,250.
The hidden cost in both: changeover type
Price depends more on the circuit and connection than the brand of tank. Our figures split on changeover:
- Like-for-like swap — same tank size, same location, existing gas or electrical connection reused. This is the cheaper path for either gas type.
- New electrical circuit — relevant if you're switching fuel types (say, electric storage to gas, or adding a gas system where there wasn't one) and new wiring, isolation switches or metering is needed.
Switching an all-electric home to gas hot water also means a gas connection has to exist or be run to the property, which is a bigger job than anything in these figures and is priced separately by the installer.
Decommissioning and compliance
Whichever type you choose, electrical and plumbing work must be carried out by a licensed tradesperson — this isn't optional and installers will typically ask for your property details before connecting gas or isolating a circuit. Removing an old gas storage tank also means disconnecting and capping gas safely, which a licensed gasfitter needs to sign off. Quotes should already include GST; if a quote looks unusually low, that's often the reason — missing disposal, missing compliance checks, or a changeover scope that doesn't match what's actually on your wall.
When each type makes sense
- Replacing an existing gas storage tank with another one — cheapest and fastest option, usually a same-day swap.
- Household with high, spread-out hot water demand (multiple bathrooms used around the same time) — continuous flow avoids running out of hot water, at a higher install cost.
- Smaller household or occasional use — a gas storage tank is usually the better-value choice; you're not paying for on-demand capacity you won't use.
- No existing gas connection — factor in the cost of running a gas line before comparing against electric storage, which avoids that step entirely.
How we calculate these figures
We build these numbers from labour hours at local trade rates plus materials — the tank or unit, fittings, flue and gas or electrical connection work — then check the result against current market prices and real trade quotes. They're a starting point for budgeting, not a substitute for a written quote from a licensed installer who's seen your existing setup.
For the full cost guide, including basic, mid-range and premium pricing across all hot water system types, see Hot water system replacement. If your home needs new circuits run as part of the changeover, House rewiring has typical pricing for that work, and if you're weighing up heat pump hot water as a lower-running-cost alternative to gas, see Heat pump hot water. Whatever quote you get back, it's worth running it past our "is my quote fair" tool before you sign off, since gas hot water quotes vary more than most trades on exactly the points covered above — changeover type, flue work and whether the gas line needs upgrading.