Don’t Pull the Plug on Your Water Heater without Research

If you don’t want to take a bath (financially), it pays to compare water heater options before you replace yours. 

While you’re diligently using your smart thermostat to minimize your utility bill, your family’s shower and bath habits may be quietly undermining your efforts.  Water heating typically consumes the second largest amount of electricity in your home—right after heating and cooling.

Whether you’re building a new home or replacing an old water heater, consider your options before you simply install the new version of what you already have.

“Replace your water heater before there’s a failure,” advises Shaylin King, owner of Mr. Rooter Plumbing of Tri-Cities, Yakima, Hermiston, Oregon, a Neighborly company. “This will help prevent any water damage repairs.”

Step Away from Gas with a Water Heater Upgrade

Before you begin to explore your water heater options, you’ll want to consider swapping your gas heater for an electric model. The obvious reason hardly needs to be said: to eliminate dependence on fossil fuels. Other reasons to switch to an electric model include lower upfront costs, lower ongoing utility costs and lower maintenance costs.

Gas systems need regular inspections for safety to catch potentially dangerous gas leaks. However, space and money are always part of home improvement decisions. If you’re building a new home, one that runs entirely on electricity is easier to configure compared to converting gas appliances.

“It can be a major project to convert a gas water heater to an electric system,” says Ben Kolo, owner of Mr. Electric of Central Iowa, a Neighborly company. “A large factor is whether the home’s electrical system can support the new unit. It may require a new 240 V circuit, running new wiring from the electrical panel, a panel upgrade and old gas lines to be capped.”

Switching from a gas water heater to a new hybrid heat pump water heater requires the same electrical considerations, he says.

“In addition, the heat pump water heater needs adequate air volume around it and works best in a garage, utility room or large mechanical room,” Kolo says. “A heat pump water heater produces some cool air condensation that has to be drained, too.”

Kolo estimates that the electrical portion for a typical water heater circuit complete with a circuit breaker and gas disconnect would cost about $1,500. Overall, depending on what type of water heater is being installed, the brand and needed upgrades for the conversion, the entire project could run more than $5,000, he says.

Three Options to Heat Your Water

One reason it’s important to replace your water heater before it fails is so you don’t have to make a decision in the thick of an emergency.

You can check the age of your water heater by looking at the model number or asking a home inspector or previous owners of the house to estimate the installation date.

Next, evaluate how much hot water you’ll need. “The size of the tank matters,” King says. “A properly sized 50-gallon tank often outperforms an undersized tankless water heater system.”

The size you need depends on your household size, number of bathrooms and how you use hot water. For example, a household with up to two people may need 30 to 40 gallons for a traditional water heater, while a household with four people is likely to need a system that holds 50 to 75 gallons. However, you may need less storage if you limit your hot water usage or need to size up if several people typically take hot showers or baths at the same time.

A tankless system provides hot water on demand, so you need to estimate your maximum gallons of hot water per minute. A plumbing expert can help.

Next, your budget and goals can help you make your decision about whether you want a traditional water heater, a tankless water heater or a heat pump water heater.

“Heat pump water heaters generally have the lowest operating costs, are extremely energy efficient, are safe due to no combustion and they have a good lifespan,” King says. “Tankless water heaters give homeowners endless water supply, are good for larger households and they save space.”

On the other hand, traditional water heaters have a lower upfront cost, are fairly simple and reliable, and are also easier to repair, he says, and work well for most families.

 Comparing Water Heater Options 

“If homeowners want a lower purchase cost, they will look at a traditional water heater,” King says. “If they want the lowest utility bills, they will want to consider a heat pump water heater, and for endless hot water and a long unit life, they may want to consider a tankless water heater.”

King points out that each option has pros and cons:

• • Pros:
    • Low upfront cost
    • Simple installation
    • Easy to service and repair
    • Work well with simultaneous fixtures until tank capacity is exhausted
  • Cons:
    • Highest energy usage over time
    • Limited hot-water supply
    • Shortest lifespan

• • Pros:
    • Endless hot water
    • More energy efficient
    • Use less space
    • Longer lifespan
    • Limited tank leak risk
  • Cons:
    • Highest installation complexity
    • Higher upfront cost
    • Struggle if multiple fixtures are running simultaneously without proper sizing
    • Periodic descaling and maintenance are required

• • Pros:
    • Most energy-efficient option
    • Low operating cost
    • No combustion gases in the home
  • Cons:
    • Higher purchase price
    • Slightly noisier than a traditional water heater
    • Require adequate installation space
    • Efficiency can drop in cooler installation locations

Prices vary depending on the size and type of water heater you choose. In addition, the cost can increase depending on installation work. For example, if you’re switching from one type of system to another or increasing the capacity of your water heater, this could require additional electrical and plumbing work as well as removal or installation of drywall.

Once you have a new system, King recommends annual maintenance of the water heater. “Flushing the water heater can significantly extend the life of the unit,” King says. An important consideration for any home improvement project is the return on investment. According to Green Builder Media’s COGNITION Smart Data, 92% of homeowners and buyers consider long-term operating costs when making a decision to remodel or buy a home.

Before spending hundreds or thousands of dollars on a water heater, it makes sense to think about more than the immediate cost and to choose one that fits your overall goals.