Electric vs. Gas Water Heaters: Which Costs More to Own?
If you’re replacing your water heater, one possible question you might have is whether to go with electric or gas. Most homes already have one or the other in place, but if you’re making a change—or just curious where your money goes—it’s worth running the numbers.
Here’s a real-world breakdown of purchase price, operating costs, lifespan, and maintenance, so you can see how these two common options stack up.
🔧 Installation Costs (Standard 50-Gallon Tank Water Heater)
| Item | Electric | Natural Gas |
|---|---|---|
| Unit Cost | $500–$800 | $600–$900 |
| Typical Install Labor | $500–$700 | $700–$1,000 |
| Total Installed Cost | $1,000–$1,500 | $1,300–$1900 |
👉 Electric is usually cheaper up front, especially if you’re just replacing what’s already there.
⚡️🔥 Operating Costs (Based on U.S. National Averages)
Let’s assume a household uses about 64 gallons of hot water per day, which is about average for a family of 3–4.
- Electric: ~4,879 kWh/year
- Natural Gas: ~199 therms/year
Using current national average energy rates:
- Electricity: $0.15 per kWh
- Natural Gas: $1.50 per therm
| Cost Category | Electric | Natural Gas |
|---|---|---|
| Annual Energy Cost | 4,879 × $0.15 = $732 | 199 × $1.50 = $299 |
| 10-Year Energy Total | $7,320 | $2,990 |
👉 Gas wins big on operating cost. It’s less than half the yearly energy bill in most cases.
🛠️ Maintenance & Lifespan
| Factor | Electric | Natural Gas |
|---|---|---|
| Average Lifespan | 10–13 years | 8–12 years |
| Maintenance Needed | Low | Medium (pilot, venting, etc.) |
| Part Cost Risk | Lower (no burners) | Higher (gas valves, thermocouple) |
👉 Electric units tend to last a bit longer and require less upkeep. Gas units can be a little more finicky.
🧮 Total Cost of Ownership: 10-Year Estimate
| Cost Category | Electric | Natural Gas |
|---|---|---|
| Install | $1,250 | $1,900 |
| 10-Year Energy Use | $7,320 | $2,990 |
| Total Ownership Cost | $8,570 | $4,890 |
💡 Bottom Line: Which Is Cheaper?
- Gas water heaters cost more up front, but save you thousands in energy over time.
- Electric heaters are simpler, cheaper to install, and better in homes without gas hookups — but they cost a lot more to run.
- If you already have a gas line available and venting in place, gas is almost always the better long-term value.
One Last Thought:
If you’re trying to save the most money right now, electric might seem attractive. But if you’re in the house for the next 5–10 years and want to minimize your monthly bills, gas usually wins that race by a long shot. These numbers can, of course, drastically change if you have a solar system or are planning on getting one soon. If you are pulling in solar power, an electric water heater becomes a no brainer.
Want help figuring out what your existing system is costing you? I can take a look at your utility rates and give you a fast, realistic estimate. Just ask.