Upgrading your hot water system? The two most popular options in New Zealand are traditional storage cylinders and continuous flow (instant) systems. Both have their strengths — the right choice depends on your home, household, and budget.How Storage Cylinders Work
A storage cylinder heats a tank of water (typically 135 to 300 litres) and keeps it hot until you need it. They can be powered by electricity, gas, or a heat pump.
Pros
Lower upfront cost
Simple, proven technology
Works with existing electrical or gas connections
Available in a wide range of sizes
Can be paired with solar panels or heat pumps for efficiency
Cons
You can run out of hot water if the tank empties
Takes up physical space (usually a cupboard)
Standby heat loss — energy is used keeping water hot even when you are not using it
Limited lifespan (15 to 20 years typically)
How Continuous Flow Works
A continuous flow system (also called instant or tankless) heats water on demand as it passes through the unit. There is no tank — the unit fires up when you turn on a hot tap and shuts off when you stop. Most continuous flow systems in NZ run on natural gas or LPG.
Pros
Unlimited hot water — it never runs out
Compact wall-mounted unit saves space
Only heats water when needed — no standby energy loss
Longer lifespan (20+ years with maintenance)
Lower running costs compared to electric cylinders
Cons
Higher upfront cost (unit plus installation)
Requires a gas supply (natural gas or LPG)
Flow rate limits how many taps can run simultaneously
Needs an electrician as well as a plumber and gasfitter for installation
Cost Comparison
Rough guide for Auckland installations (2024/2025 pricing):
Electric storage cylinder (replace like for like): $2,000 to $3,500 installed
Gas continuous flow (e.g. Rinnai Infinity A26): $3,500 to $5,500 installed
Heat pump hot water: $4,000 to $6,500 installed
Running costs vary, but continuous flow gas systems typically cost less per year than electric cylinders, especially for larger households.
Which Is Right for You?
Choose a storage cylinder if:
You want the lowest upfront cost
You already have a cylinder cupboard and electrical connection
Your household is small to medium (1 to 3 people)
You are happy with a straightforward like-for-like replacement
Choose continuous flow if:
You are sick of running out of hot water
You have a gas connection or are willing to install one
You want lower long-term running costs
You have a larger household or high hot water demand
You want to free up cupboard space
Not Sure? We Can Help
Every home is different. We will assess your current setup, talk through your options, and recommend the best solution — no pressure, just honest advice.
Call 0800 322 322 for a free quote or email service@wgw.co.nz