How much does it cost to replace a water heater?

A common question we get here at Horn Plumbing is “How much does it cost to replace a water heater?”, and the answer is that it depends on the home and the unique needs of the customer. Let’s have a look at the different decisions and requirements that will play a role in how much you have to pay.

Water Heater Replacement Cost Factors

• The Cost of Labor

The cost of labor varies depending on where you live, but within a particular region, labor-related installation costs are usually rather standard. You can call several area plumbers to get an idea of what labor costs should be and whether a particular bid is too low or too high.

• Permit Requirements and Fees

Generally, permits are not required for like-for-like water heater installation. This does vary between states and local governments, and if a permit is required, it’ll be a fixed amount specific to your area.

• Water Heater Disposal Fees

Many plumbers will include water heater disposal in their installation costs but not all. You may need to ask if there’s a fee and what it is. The fee is typically small enough to be worth it to most homeowners, but if you prefer to dispose of the unit yourself, you may be able to save a bit of money here.

• Fees for Special Installation Requirements

Another factor to consider when it comes to how much it costs to replace a water heater is any special installation requirements that you may have. If your water heater is in a water heater closet just big enough to contain the unit, for example, there may be an additional fee for dealing with those space restrictions. There will also be additional fees usually when converting from electric to gas or vice versa or when transitioning from one water heater technology to another.

• Household Requirements

The cost of your system will be directly proportional to the needs of your household. Bigger homes generally require more hot water capacity, and the hot water needs of a couple with no children will be significantly less than a family of six.

Electric vs. Gas Water Heater

For the homeowner who has the choice, gas versus electric is a big factor in the question “How much does it cost to replace a water heater?”. Electric water heaters are less expensive to buy and install. That said, gas water heaters are much more efficient and will cost you less in total over the life of the appliance.

Condensing vs. Standard Gas Water Heater

If you do opt for gas, then another consideration is whether to go with a standard gas water heater or a high-efficiency model, which are also known as condensing water heaters. The U.S. Department of Energy estimates the average annual savings with a condensing water heater to be $100. How much you’re expected to save each year will determine if the higher initial cost is worth it.

Tank vs. Tankless Water Heater

A modern trend in answering “How much does it cost to replace a water heater?”, is whether you opt for a traditional tank water heater or a modern on-demand water heating system. On-demand systems are more convenient and provide a virtually endless supply of hot water when sized correctly. They also last longer and can therefore actually be cheaper over the life of the system. There are additional costs for the initial installation, however. Consequently, you’re not likely to save with your first tankless water heater but will likely save with each subsequent tankless system.