Gas vs. Electric Water Heater – What’s Good for Your Home and Budget

It can be difficult to understand the “gas vs. electric water heater” issue. Since both of them provide the same outcome—hot water—they must be essentially interchangeable, right?

Not exactly.

To assist you in determining which is ideal for your home, we’ll compare the features of gas and electric water heaters in this post. But we won’t stop there; this post will also include solar, heat pumps, and tankless water heaters to give you a complete view of your alternatives.

Gas vs. Electric Water Heater: Why Should You Care?

Let’s start by answering the query posed in the opening clause of this article: does the debate even matter?

The U.S. Department of Energy estimates that your water heater uses up to 18% of your home’s energy. As a result, choosing the most effective unit for your needs (your neighbor’s needs might not be the same as yours) will help you save a great amount each month.

Of course, the unit’s price must be considered when deciding between a gas vs. electric water heater. Different kinds of water heaters are available at various price ranges, which may significantly affect your final choice.

Gas Water Heater or Electric: Things to Consider

Before comparing each type of water heater side by side, let’s take a closer look at each one to compare its qualities.

We’ll mention that Phoenix water heaters contain both electric and gas-powered models with complete transparency. In other words, we have no preference and are more concerned with assisting you in selecting the unit that is actually best for your house.

Gas Water Heaters

This sort of water heater runs on natural gas, as its name would imply. A gas burner heats the cold water as it reaches the tank. The water rises to the top of the tank as it warms and is then sent through a discharge line to exit through your faucets or showerheads as necessary.

This is a fairly straightforward explanation of how water heaters function. Water heaters have a number of very clever systems that guarantee safe operation.

Although gas water heater explosions do occur, current water heaters’ highly complex systems make this fairly improbable. This means that gas water heaters are excellent at cooling your home because of their high efficiency.

Although we’ll go into great detail about costs later, it’s important to note in this section that natural gas is frequently less expensive than electricity. This is yet another fantastic benefit of gas water heaters.

gas water heater

Electric Water Heaters

Standard electric water heaters function similarly to gas ones, with the obvious exception of tankless models. Electric water heaters have a heating element to initiate the convection process rather than a gas burner.

Apart from that, gas and electric water heaters have the same parts. However, given that, as was already noted, electricity in the United States often costs significantly more than natural gas, their energy source is a rather significant difference.

Additionally, your hot water will stop working if your electricity fails. Most conventional gas water heaters don’t experience this; even if they occasionally need electricity, they can operate on their own.

This is something to keep in mind if you’re considering getting an electric water heater yet live in a place where power outages are often.

Gas Water Heater vs. Electric Cost

The cost of gas water heaters is typically just marginally higher than that of electric ones. For instance, we charge $999 for a 40-gallon gas water heater and $950 for a 40-gallon electric water heater.

When you take energy consumption into account, you only truly start to notice a price difference. Users usually pay more than make up whatever extra cost they paid for a gas water heater over an electric one because they don’t utilize power.

Gas vs. Electric Water Heater: The Verdict

That must be it, then, right? Since gas hot water heaters use less energy and have lower long-term costs than electric ones, they must be the best option.

No, not always.

An electric water heater would be useful if your water heater needs to fit into a very small space because they are frequently significantly smaller. Electric water heaters are also significantly more affordable and simpler to install because they don’t need venting.

Given the price difference between a gas and an electric water heater, you might choose the latter if you need a new water heater but are also short on funds.

Other Types of Water Heaters to Consider

Comparisons between other types of heaters are more obvious, even though the argument between a gas and an electric hot water heater exposes more parallels than differences.

Gas Water Heater vs. Electric Tankless/Gas Tankless

You should be aware that an electric tankless water heater operates according to demand when comparing it to a gas water heater. An electric heating element still heats your water, but it only does so when the system decides you need hot water (i.e., when you open a tap).

As a result, electric tankless water heaters use up to 98% of the electricity they need to heat your water completely. Electric tankless heaters are thus incredibly energy-efficient.

Tankless gas water heaters are also quite effective, although they only use roughly 85% of the electricity they consume to heat water.

There is, of course, a catch. A few, in fact.

First off, purchasing, installing, and operating electric tankless water heaters may be highly expensive. They are difficult for novice people to maintain since they need a lot of electrical labor. According to Energy Star, tankless heaters enable users to save an average of $1800 over the course of the appliance. Installation and utility expenditures can reduce those savings to a very small amount.

Second, tankless heaters (both gas and electric) have a higher risk of running out of hot water compared to conventional systems.

electric water heater

Heat Pump Water Heaters

Heat pump water heaters are less widespread than the previously stated appliances. Compared to a typical water heater, their operation is more similar to that of an air conditioner.

HVAC unit Water heaters draw heat from outside your house and pump it into the storage tank, as the name implies. The majority of heat pumps are geothermal, meaning they draw heat from the earth, according to the Department of Energy.

There are benefits to using this technique to heat water. Heat pump water boilers can be up to 2.5 times more efficient than alternative techniques when they function properly.

However, if you reside in a region with extreme temperature fluctuations, there will be times of the year when your heat pump is completely inoperative.

Most owners of heat pumps also have an on-demand system (such as a tankless one) installed to accommodate this. This on-demand system fills in where your heat pump leaves off, but it adds to the expense and complicates the process of installing and maintaining your water heating system.

Solar Water Heaters

In states like Arizona, where it’s sunny for most of the year, this is another alternative that’s becoming more and more well-liked. Even though these systems are energy-efficient, there are a few drawbacks to note.

Not every expert will be able to service solar water heaters optimally because they are still somewhat of a specialty item. A solar heater is obviously not for you if you reside in a location where there are frequent periods of cloudy weather. Additionally, you need to be mindful of the higher installation costs and perhaps reduced serviceability.

Concerns regarding how environmentally friendly solar panels are specifically are also a topic of some legitimate dispute. We won’t judge but draw the conclusion that they don’t defeat the point if you lean that way.

best water heater

Cost and Lifespan

Traditional gas and electric storage units have comparable initial purchase costs, but because electricity is more expensive to consume than gas, electric units will cost more to operate over time. The need for a 220-volt outlet and the cabling for this in an electrical panel might increase the cost of installing an electric water heater. Electric water heaters might last a little bit longer than gas ones, but this mostly depends on the water quality in the area and owner maintenance.

Gas is virtually always less expensive for customers than electricity, and this alone has led many homes to prefer gas water heaters. It is far less expensive if a gas line is already present in the house. It can be costly to switch from electric to gas because it may be necessary to construct a gas connection and venting for exhaust heat. The lifespan of gas heaters may be slightly shorter, although the difference is not very great (12 instead of 13 years, for example).


A 50-gallon tank may be heated by a gas heater in about an hour. It recovers significantly more quickly than an electric heater (i.e., how long it takes to reheat a tank of water after use). Traditional gas water heaters also benefit from continuing to operate in the case of a power loss. An electric heater is likely to struggle to keep up with the hot water demands of a bigger household; therefore, for families of four or more, a gas heater is typically preferable.

The primary drawback of an electric water heater is its often slow rate of recovery. Usually, it will take several hours for a standard 50-gallon tank to recover. Electric appliances are also susceptible to power outages and will not function during one.


Due to heat loss from exhaust gases and the storage tank’s walls, conventional gas storage systems are comparatively inefficient. While having hot water at all times is convenient, it also means that energy is continually being used and lost. But modern appliances are becoming more energy-efficient, and top-of-the-line condensing appliances are extremely energy-efficient. Efficiency can be considerably improved by insulating the storage tank with two inches of foam.

Although gas heaters are significantly less energy efficient than electric ones, the real energy savings are lessened by the higher price of electricity. Despite being significantly more efficient than any alternative, electric heat pump devices are uncommon and expensive.

gas and electric water heater
Close-up of man hands setting the temperature of water in Electric Boiler

Final Words

The choice between a gas and an electric water heater is typically based on price and available space. Gas water heaters are slightly more expensive to build, but during the first year of use, the reduced cost of natural gas easily offsets this.

Electric water heaters do have a use, though. Electric heaters are difficult to beat if you have a tiny space in which to install the heater. The same is true if your circumstances prevent you from installing the venting that a gas heater requires (either financially or structurally).

There are more specialized use cases for other types of water heaters (such as tankless and solar) that keep the vast majority of people out.


Do Gas or Electric Water Heaters Last Longer?

Electric and gas water heaters both have a similar lifespan. The difference between tankless and tank systems is where you’ll start to see it. Tankless water heaters can endure for 20 years or longer, while tank water heaters typically fail after 10 to 13 years.

Should I Switch from Gas to an Electric Water Heater?

You don’t need to change unless your water heater is giving you trouble and you need to replace it. Gas and electric water heaters are commonly used in the business and can be used for many years.

Which Water Heater is Most Efficient?

As you might have guessed, tankless water heaters lack a tank. Instead, the device’s coils superheat it when the water travels through the mechanism to its final destination. One of the most energy-efficient ways to heat water in your house, as a result, is on-demand hot water that rarely runs out.

Can I Replace My Gas Water Heater with an Electric One?

It is feasible to transition from a gas water heater to an electric one, albeit it is less typical. Electric water heaters often have a longer lifespan since they have fewer internal parts. Additionally, they could take up less room inside your house.

When you buy something through our affiliate links, we earn a commission without you having to pay extra.