The honest answer, from people who install solar in Mackay every week, is this: a dedicated solar hot water system is usually not the best way to spend your money in 2026. For most Mackay homes the smarter move is solar panels plus a standard electric hot water system on a timer, heating your water with cheap daytime solar.
That is not what you expect to hear when you search “solar hot water Mackay”, so here is the full reasoning, with the numbers and the cases where solar hot water does still make sense.
The short version
| Option | Upfront cost (installed) | What heats the water | Best for |
|---|---|---|---|
| Dedicated solar hot water (roof collectors) | ~$3,500 to $6,000+ | Sun on roof collectors, plus an electric or gas booster | Homes with no room or budget for extra panels |
| Solar panels + electric hot water on a timer | Marginal cost of extra panels, plus ~$700 to $1,500 for the tank | Daytime solar through your existing panels | Most Mackay homes, especially with or planning solar |
| Heat pump + solar panels + timer | ~$2,500 to $4,000 for the heat pump before rebates | Daytime solar, using about a third of the power of a normal element | Best efficiency and lowest running cost |
Why a dedicated solar hot water system rarely pays off now
A decade ago, solar hot water made clear sense. Roof collectors and a tank were the cheapest way to use the sun, because solar panels were expensive.
That has flipped. Solar panels are now so cheap per watt that the better value is to put a few extra panels on your roof and use that electricity to heat an ordinary tank. You get the same hot water, you avoid the higher cost and the extra roof plumbing of a thermal system, and the same panels also run your aircon, your fridge and everything else. A solar hot water system only ever heats water.
The smarter setup: panels plus electric hot water on a timer
Here is how Mackay homes get effectively free hot water without a dedicated solar hot water system.
You set your electric hot water system to heat for a short block in the middle of the day, instead of overnight. A large tank only needs about two hours to come up to temperature, so a midday block, for example 11am to 1pm, is usually enough. During that block your panels put the excess straight into the tank instead of exporting it to the grid, and for the rest of the day the same panels power the house.
From 1 July 2026 the Ergon regional feed-in tariff is 6.153 c/kWh, while power you buy back in the evening costs around 33 c/kWh. Every kilowatt hour your panels put into the tank during the day is worth far more to you than the 6.153 c you would have earned exporting it. You are turning cheap daytime solar into stored hot water for the evening shower.
There are two ways to control the timing:
- A simple timer in the meter box. An electrician sets the hot water circuit to switch on during the solar window. Cheapest option, works on any electric tank.
- A solar diverter. A smart controller watches your solar export and sends only the genuine excess to the element, so you never pull from the grid to heat water. Costs more, squeezes out a bit more saving.
If you are on Ergon’s Tariff 12E Solar Soaker, this works even better. The daytime rate between 11am and 4pm is around 7.7 c/kWh, so even on a cloudy day you are heating with cheap power rather than the 4pm to 9pm peak of around 57.3 c/kWh.
What about a heat pump hot water system?
A heat pump is an electric hot water system that uses about a third of the power of a standard element to heat the same water. Pair it with solar panels and a timer set to the solar window, and your hot water running cost gets very close to zero.
For most Mackay homes that want the lowest possible running cost, a heat pump plus solar plus a timer beats a dedicated solar hot water system on both upfront flexibility and long term cost. Heat pumps also qualify for federal rebates, which brings the upfront cost down.
When solar hot water can still make sense
We would rather lose the job than sell you something that does not pay off, so here is the honest other side.
A dedicated solar hot water system can still be the right call if:
- Your roof has no room for the extra panels you would need, but does have room for thermal collectors.
- You are replacing an old gas hot water system and want to cut gas entirely without a big panel upgrade.
- You are off grid or have an unusual usage pattern where storing heat directly is simpler.
For the typical Mackay home with a normal roof and either existing solar or solar on the way, the panels plus timer or heat pump route wins.
How to set your hot water timer in Mackay
If you already have solar and an electric tank, you may be heating water at the wrong time of day and paying for it.
- Ask your electrician to set the hot water timer to run a short block in the solar peak, for example 11am to 1pm. A large tank only needs about two hours to fully heat.
- That leaves the rest of the day’s solar to power the house, run the aircon and charge a battery if you have one.
- Avoid the old default of overnight or controlled supply heating if you have solar, because that heats with grid power at night instead of free solar by day.
- For the most control, a solar diverter only uses genuine excess solar and never tops up from the grid.
A timer change is a small job and one of the fastest ways to cut a Mackay power bill if you already have panels.
Rebates
Solar water heaters and heat pumps can earn a one off batch of small-scale technology certificates (STCs) under the federal Small-scale Renewable Energy Scheme, which the installer normally takes straight off the price. That helps the upfront cost of a heat pump in particular. It does not change the overall maths in favour of dedicated solar thermal for most homes, because the panels plus timer approach is still cheaper and more flexible.
Frequently asked questions
Is solar hot water worth it in Mackay in 2026?
For most homes, no. A dedicated solar hot water system rarely beats solar panels plus an electric hot water system on a timer, which heats water with cheap daytime solar for a lower total cost and gives you panels that power the whole house, not just the tank.
How do I heat my hot water with solar panels?
Put your electric hot water system on a timer, or a solar diverter, set to run a short block in the middle of the day, for example 11am to 1pm. A large tank only needs about two hours, and the excess solar your panels make heats it instead of being exported at 6.153 c/kWh.
What time should I set my hot water timer in Mackay?
Set it to heat during the solar window, around 10am to 3pm. On Ergon’s Tariff 12E Solar Soaker the daytime rate is about 7.7 c/kWh, so you heat with cheap power instead of the 4pm to 9pm peak of around 57.3 c/kWh.
Is a heat pump better than solar hot water?
For most Mackay homes paired with solar, yes. A heat pump uses about a third of the electricity of a standard element, qualifies for STC rebates, and runs very cheaply on daytime solar through a timer.
Does solar hot water get a rebate in Queensland?
Solar water heaters and heat pumps can earn one off small-scale technology certificates under the federal SRES, usually taken off the price by the installer. It helps, but it does not make dedicated solar thermal the best value for most homes.
What to do next
Next Phase Solar designs residential solar systems for Mackay homes, and we will set your hot water up the way that actually saves you money, whether that is extra panels and a timer, a heat pump, or in the right case a solar hot water system. Brad and the crew are local, Queensland Class A licensed and SAA accredited, and we will look at your roof, your Ergon bills and your routine before we recommend anything.
Book a free assessment at /quote
Sources
- Regional feed-in tariff and Tariff 12E Solar Soaker, Ergon Energy
- Small-scale Renewable Energy Scheme and STCs for water heaters, Clean Energy Regulator
- Hot water system guidance, energy.gov.au
Last reviewed June 2026.
