The group discussed designing a water heater. They proposed using a 3.5 kW heater powered by 220V AC electricity. Safety features would include flow control, an ELCB circuit breaker, a thermostat to cut power at 57 degrees Celsius, and a protective cover for the printed circuit board. Each group member was assigned a component to research: the student was given the power circuit to design using components like a heater, ELCB, and opto-isolator. In the next week, the group will distribute work and begin circuit designs for each water heater component.