Electric vs gas water heater: which costs less?
Another gas tank comes out cheaper in 20 of 20 ways the next 12 years could go — by about $40 a month. That’s for a 3-person home at US average prices, as of Jun 2026.
Each mark is one way the next 12 years could go.
Live source
Average residential electricity price by state (year to date)
U.S. Energy Information Administration, Electric Power Monthly table 5.6.B
Data as of Jun 2026.
Average residential price so far this year.
Live source
Residential natural gas price and use by state
U.S. Energy Information Administration
Data as of Jun 2026.
Average of the latest 12 months, weighted by use; 10.37 therms per thousand cubic feet.
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
National cost-guide ranges; your quote replaces this.
Three questions
What would change the answer
No realistic change in household size, price, or years flips this one.
Got a quote? See if it’s fair
Type the installed price. The answer uses it instead of our typical price.
Installed, a gas tank usually costs $1,600–$2,800.
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
National cost-guide ranges; your quote replaces this.
What a quote usually includes
- The heater itself, delivered
- Taking out and hauling away the old one
- Labor, fittings, and a new shut-off valve
- A permit and inspection, where your town requires one
- An expansion tank or drain pan, if code calls for one
- Venting, gas, or wiring changes when you switch types
Research source
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
The four types: cost, lifespan, and what each needs
Gas tank
$1,600–$2,800 installed · lasts about 12 years
Often in the same or next day when it replaces a gas tank.
Needs a gas line and a vent pipe.
Living with it: Most keep making hot water in a power outage. Can run out during back-to-back showers, and an old tank can leak.
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
Typical timing is our estimate from installer cost guides.
Electric tank
$1,200–$2,200 installed · lasts about 10 years
Often in the same or next day.
Needs a 240-volt circuit. Switching from gas adds one.
Living with it: Simple and quiet, but the slowest to reheat after heavy use, and no hot water in a power outage.
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
Typical timing is our estimate from installer cost guides.
Tankless heater
$2,500–$5,600 installed · lasts about 20 years
Often takes longer to arrange: new venting, and sometimes a bigger gas line.
Hangs on a wall. Needs venting and enough gas supply.
Living with it: Doesn’t run out, but hot water can take a little longer to reach the tap, it needs power to run, and hard water means yearly flushing.
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
Typical timing is our estimate from installer cost guides.
Heat pump
$4,100–$6,800 installed · lasts about 13 years
Can take days to arrange if it needs new wiring or a drain. 120-volt plug-in models skip the wiring.
Needs a spot that stays above 40°F with about 700 cubic feet of air around it, and a drain for condensation.
Living with it: Hums about as loud as a dishwasher and blows cool air. After heavy use it may switch to its backup element, which costs more to run.
Your basement likely stays warm enough for it all year.
Research source
Is a heat pump water heater right for your home?
U.S. EPA ENERGY STAR
Checked Sep 14, 2026.
Why it comes out this way
Typical amounts over 12 years: buying and installing (again, when one wears out), energy, upkeep, and leak damage, minus the life left at the end.
Pay now, then every month
| Heater | Up front | A month, all-in | Lasts about |
|---|---|---|---|
| Gas tank | $2,187 | $43 | 12 yrs |
| Electric tank | $2,550 | $84 | 10 yrs |
| Tankless heater | $4,157 | $55 | 20 yrs |
| Heat pump | $5,408 | $66 | 13 yrs |
“A month, all-in” spreads every cost over the months you own it.
Where the money goes
What decides it: energy ($6,428 apart) and buying & installing ($4,929 apart). The other costs are closer.
Energy
Gas tank: $3,755Electric tank: $9,266Tankless heater: $2,838Heat pump: $3,673Buying & installing
Gas tank: $3,362Electric tank: $3,803Tankless heater: $4,098Heat pump: $8,291Upkeep
Gas tank: $377Electric tank: $364Tankless heater: $2,454Heat pump: $676Life left at the end
Gas tank: −$1,264Electric tank: −$1,187Tankless heater: −$1,453Heat pump: −$3,001Leak damage risk
Gas tank: $111Electric tank: $170Tankless heater: $0Heat pump: $126
Show as a table
| Cost | Gas tank | Electric tank | Tankless heater | Heat pump |
|---|---|---|---|---|
| Energy | $3,755 | $9,266 | $2,838 | $3,673 |
| Buying & installing | $3,362 | $3,803 | $4,098 | $8,291 |
| Upkeep | $377 | $364 | $2,454 | $676 |
| Life left at the end | −$1,264 | −$1,187 | −$1,453 | −$3,001 |
| Leak damage risk | $111 | $170 | $0 | $126 |
Year by year
An electric tank earns back its extra up-front cost by year 1 in 1 of 20 futures. A electric tank typically lasts about 10 years.
Leak damage risk, out of 100
About how many homes in 100 have a worn-out tank damage the house within 12 years.
Gas tank leaks and does damage
Electric tank leaks and does damage
Heat pump leaks and does damage
What we assumed, and where it came from
- Electricity
- 18.2¢ per kWh
Live source
Average residential electricity price by state (year to date)
U.S. Energy Information Administration, Electric Power Monthly table 5.6.B
Data as of Jun 2026.
Average residential price so far this year.
- Natural gas
- $1.57 per therm
Live source
Residential natural gas price and use by state
U.S. Energy Information Administration
Data as of Jun 2026.
Average of the latest 12 months, weighted by use; 10.37 therms per thousand cubic feet.
- Weather, for how cold the water comes in
- Monthly averages
Live source
Statewide monthly temperatures and heating/cooling degree days
NOAA National Centers for Environmental Information
Data as of Dec 2025.
Average temperature for each month over the last 10 years.
- Hot water a household your size uses
- Survey medians
Our estimate
Residential Energy Consumption Survey 2020 microdata
U.S. Energy Information Administration
Checked Sep 14, 2026.
Spread chosen so 8 in 10 futures land within about ±30% of the survey median for your household size.
- Installed price: gas tank
- $1,600–$2,800
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
National cost-guide ranges; your quote replaces this.
- Installed price: electric tank
- $1,200–$2,200
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
National cost-guide ranges; your quote replaces this.
- Installed price: tankless heater
- $2,500–$5,600
Our estimate
Installed water heater price ranges from national cost guides
HomeGuide and Angi cost guides (search summaries)
Checked Sep 14, 2026.
National cost-guide ranges; your quote replaces this.
- Installed price: heat pump
- $4,100–$6,800
Research source
Home electrification cost estimates
Rewiring America
Checked Sep 14, 2026.
Replacing gas usually adds a 240-volt circuit and a drain line.
- How long tanks last
- Lifetime study
Our estimate
Residential appliance lifetime estimates (Lutz et al.)
Lawrence Berkeley National Laboratory
Checked Sep 14, 2026.
Centered on LBNL’s median of 12 years (mean 13.9).
- Leak damage when a tank fails
- Claim figures
Our estimate
Water heater failure and leak claim figures (IBHS, summarized)
Plumbing trade summaries of IBHS research
Checked Sep 14, 2026.
Average insurance claims run about $4,400; typical deductibles and uninsured cleanup set the lower end.
No federal tax credit is counted: the home energy credits ended for equipment installed after December 31, 2025. Internal Revenue Service, checked Sep 14, 2026. State and utility rebates vary; add one where the tool asks.
Every number the model uses, with its source, is on the math page.
For the curious: all the numbers
We play out 1,000 futures. Each draws its own energy prices, hot water use, install prices, and how long each heater lasts, and every type lives through the same ones.
| Option | A good case | Typical | A bad case |
|---|---|---|---|
| another gas tank | $4,945 | $6,231 | $7,875 |
| an electric tank | $9,405 | $12,030 | $15,693 |
| a tankless heater | $6,523 | $7,860 | $9,469 |
| a heat pump | $7,963 | $9,553 | $11,919 |
What moves the gap most
The unknowns whose ups and downs most change which option comes out ahead. A good or bad case is 1 future in 10 at that end.
- How much hot water you usea little
- Future gas pricesa little
- Future electricity pricesa little
Try other assumptions
Each change replays every future. Watch which coins move.
Have a rebate?
Utilities and states run their own programs, and they change often. Type any amount you’ve been offered.
No federal tax credit is counted: the home energy credits ended for equipment installed after December 31, 2025. Internal Revenue Service, checked Sep 14, 2026. State and utility rebates vary; add one where the tool asks.
What goes into it
| Cost | Another gas tank | An electric tank |
|---|---|---|
| Installed price, typical | $2,200 | $1,700 |
| Buying & installing | $3,362 | $3,803 |
| Energy | $3,755 | $9,266 |
| Upkeep | $377 | $364 |
| Leak damage risk | $111 | $170 |
| Life left at the end | −$1,264 | −$1,187 |
| All-in, each month | $43 | $84 |
Questions people ask
How much does an electric tank cost installed?
Usually $1,200–$2,200 replacing a gas tank, against $1,600–$2,800 for a gas tank. An electric tank earns back its extra up-front cost by year 1 in 1 of 20 futures.
How long does each one last?
Typically about 10 years for an electric tank and 12 years for a gas tank. The comparison counts a replacement if one wears out first.
What does switching to an electric tank involve?
Needs a 240-volt circuit. Switching from gas adds one. Often in the same or next day.
What would change the answer?
Nothing within everyday ranges of household size, price, or years flips it.
How sure is this?
We ran 1,000 possible futures of prices, repairs, and resale over 12 years. In 8 of 10, the result falls between another gas tank $3,900 cheaper and another gas tank $8,600 cheaper. In the middle one, another gas tank comes out $5,900 cheaper.