Gas vs. Electric Water Heaters

You want to buy a new water heater for your home. That's great! But now you have to decide if a gas or electric water heater is best for you. Here's what you should consider when deciding between gas or electric water heaters.

Initial Cost

Gas and electric water heaters are comparable in the initial price of the unit. Depending on how many gallons you want your water heater to hold, the energy output, and the warranty (if any comes with it), costs will vary between $200 and $1,000. However, the installation cost of a gas water heater may be a bit more expensive if you don't already have a gas line running from your supply to the location where you will store the tank. It can be costly to install this line, so factor the cost of installation into the price of the tank itself.

Supply of Power

If your house is already equipped with a gas line and you use other gas appliances (such as a gas stove or furnace), a gas water heater may be a good fit for you. However, if your home is not yet set up to receive gas, then you would need to install a gas line to your home, if gas is available in your neighborhood. This can be extremely costly and would likely add another utility bill to your monthly expenses. If your home is not already set up to use gas, it would be more cost effective for you to purchase an electric water heater for your home.

Operating Cost

If you already have a gas line running to your house and to the location where you want to store the water heater, then the two options are probably neck-and-neck. So now let's look at the operating cost. The cost of gas and electricity differs from city to city, but in most cases gas costs less than electricity. So if you'd like to save on your monthly bill and you have access to a gas line, a gas water heater may be a better option for you.

Efficiency

Lastly, it's important to consider efficiency when purchasing a new water heater. Though gas costs less than electricity, the amount of gas or electricity needed to heat your home's water may make a difference in the operating cost, longer term.

The energy efficiency of water heaters and other appliances are rated on a standard scale called the Energy Factor (EF) system. This allows consumers to compare appliances based on the same standards. A higher EF rating means that the appliance is more efficient. According to the EF system, an average electric water heater has an EF rating of between 0.75 and 0.95. and an average gas water heater has an EF rating of between 0.60 and 0.70.

The EF system shows us that electric water heaters are considerably more efficient than gas water heaters. So while electricity is more expensive than gas, an electric water heater will use much less power than a gas water heater.

Overall, gas and electric water heaters are pretty even, in terms of the initial cost of the unit. However, if you don't already have a gas line running to your water heater location and you purchase an electric water heater with a high EF rating, then an electric water heater will likely be a better fit for you long-term. If you already have a gas supply and gas is significantly cheaper than electricity in your region, then a gas water heater would be a smart purchase.