THE SHORT VERSION
- Same price to install when you replace with the same type: Home Depot publishes $1,600–$2,400 for a gas or an electric tank. Switching fuel is what costs extra, such as a new gas line ($1,500–$2,300 on This Old House’s estimate) or a new 240-volt circuit.
- Gas costs far less to run than a plain electric tank: about $384 a year against $919 for a busy household at DOE’s national prices. At state average prices, the gas tank is cheaper to run in every state.
- A heat pump water heater changes the answer: about $214 a year. At state average prices it costs less to run than a standard gas tank everywhere except Alaska, where they tie.
- Gas recovers about twice as fast: a 50-gallon gas tank is rated at 89 gallons in its first hour, a 50-gallon electric tank at 62.
- Different needs, different risks: gas needs a vent, combustion air and carbon monoxide precautions; electric needs a dedicated 240-volt circuit. A standing-pilot gas tank keeps working in a power outage; electric, power-vent and tankless models don’t.
Gas and electric side by side
Most US homes heat water with a storage tank that burns natural gas (or propane) or uses electric elements. The two cost about the same to install. They differ in running cost, recovery speed, what the house must provide and what happens in a power outage. The heat pump column is the efficient way to heat water with electricity.
| Gas tank (atmospheric) | Electric tank | Heat pump tank | |
|---|---|---|---|
| Installed price (Home Depot) | $1,600–$2,400 | $1,600–$2,400 | $2,500–$5,000 |
| Energy cost a year, busy household | About $384 | About $919 | About $214 |
| First-hour rating | 89 gallons | 62 gallons | 51–67 gallons, by model |
| Needs from the house | Gas line, vent, combustion air | Dedicated 240-volt circuit | 240 V circuit (120 V on some models), room air, condensate drain |
| In a power outage | Standing-pilot models keep heating | No heating | No heating |
| Average life in DOE’s analysis | 14.5 years | 15.1 years | 13–15 years (ENERGY STAR) |
Sources: Home Depot published installed ranges; Ember & Tank calculation at 84 gallons a day and DOE’s representative 2025 prices (17.22¢/kWh, $1.43/therm); Bradford White RG250T6N, Rheem XE50T09EL45U1 and Rheem ProTerra spec sheets; DOE’s 2024 water heater rule; ENERGY STAR.
Installed price is a tie unless you switch fuels
Home Depot publishes one installed range for a standard gas or electric tank: $1,600–$2,400, average $1,950. DOE’s cost model for its 2024 efficiency rule does show a gap, averaging $1,432 installed for a baseline gas tank and $902 for an electric one (2022 dollars), but for a same-type swap that reuses the gas line and vent, or the circuit, fuel barely moves the price.
Changing fuel is what costs money. This Old House estimates $1,500–$2,300 for new gas lines when converting electric to gas, before vent work; going the other way can mean new wiring or a panel upgrade. See switching from gas to electric and what makes one installation cost more.
Gas costs less to run than a standard electric tank in every state
An electric tank looks more efficient on paper, with a Uniform Energy Factor (UEF) of 0.93 against about 0.63 for a standard gas tank, because some gas heat goes up the flue. But DOE’s 2025 representative prices put electricity at $50.47 per million Btu and natural gas at $14.37, so heat from the wire costs about 3.5 times as much.
| Heater (UEF) | Energy a year | Cost at DOE prices |
|---|---|---|
| Standard gas tank (0.63) | 269 therms | $384 |
| Same tank on propane (0.63) | 294 gallons | $690 |
| Standard electric tank (0.93) | 5,334 kWh | $919 |
| Heat pump, 240 V (ENERGY STAR median) | 1,240 kWh | $214 |
Ember & Tank calculation with DOE’s test formula (10 CFR 430, Subpart B, Appendix E): 365 days × 84 gallons × 8.24 lb per gallon × 67°F rise = 16.93 million Btu a year, divided by UEF. Prices: DOE’s representative 2025 costs (17.22¢/kWh, $1.43/therm, $2.35/gallon of propane), published March 26, 2026. A 55-gallon-a-day household pays about two-thirds as much.
Local prices swing widely: EIA puts average home electricity at about 12¢ per kWh in North Dakota, 33¢ in California and 46¢ in Hawaii, and gas at 74¢ a therm in Idaho and $2.46 in Florida. Two rules of thumb come out of the math, and they hold whatever your household’s usage:
- Plain electric matches gas only when electricity costs about 5¢ per kWh for each $1 per therm of gas, about 7¢ at $1.43 gas. No state averages that low, so at state average prices the gas tank is cheaper to run everywhere.
- A heat pump matches a gas tank at about 22¢ per kWh for each $1 per therm, about 31¢ at $1.43 gas. At state average prices, the heat pump is cheaper everywhere except Alaska, where the two tie at about $336 a year.
| Electricity | Electric tank | Heat pump |
|---|---|---|
| 12¢ per kWh | $640 | $149 |
| 17.22¢ (DOE) | $919 | $214 |
| 25¢ | $1,334 | $310 |
| 35¢ | $1,867 | $434 |
| 45¢ | $2,400 | $558 |
Ember & Tank calculation, same method. Use the per-kWh charges on your bill, not fixed monthly fees.
| Natural gas | Gas tank |
|---|---|
| $0.75 per therm | $202 |
| $1.00 | $269 |
| $1.43 (DOE) | $385 |
| $2.00 | $538 |
| $2.50 | $672 |
Ember & Tank calculation, same method. If your bill prices gas per ccf, divide by 1.037 to get dollars per therm (EIA).
| State | Electricity | Gas | Gas tank | Electric tank | Heat pump |
|---|---|---|---|---|---|
| Idaho | 13.0¢ | $0.74 | $199 | $691 | $161 |
| Texas | 16.1¢ | $1.87 | $504 | $857 | $199 |
| Florida | 15.3¢ | $2.46 | $661 | $816 | $190 |
| New York | 29.4¢ | $1.70 | $456 | $1,567 | $364 |
| California | 33.3¢ | $2.12 | $571 | $1,774 | $412 |
Ember & Tank calculation. Electricity: EIA Electric Power Monthly Table 5.6.B, residential, January–July 2026. Gas per therm: EIA residential average for 2025 ($/Mcf ÷ 10.37).
Work out your own cost from the EnergyGuide label
New conventional gas and electric tanks carry an EnergyGuide label. Under the FTC’s rule it shows the first-hour rating, an estimated yearly cost at a national average price, and the estimated yearly energy use in kWh or therms, which is the number to use. Heat pump models don’t have to carry the label; take their yearly kWh from the spec sheet.
The middle step matters when you compare fuels. DOE tests a heater with a first-hour rating of 51–74.9 gallons at 55 gallons a day and one rated 75 or more at 84 gallons a day, so a typical 50-gallon electric tank (62) and gas tank (89) are labeled at different amounts of hot water. Scale both to your own daily use before comparing. More in the EnergyGuide label and UEF.
Gas tanks recover about twice as fast
Bradford White rates its 50-gallon gas tank with a 40,000 BTU/h burner at 43 gallons an hour at a 90°F rise and a first-hour rating of 89 gallons. Rheem rates its 50-gallon electric tank, whose two 4,500-watt elements take turns, at 21 gallons an hour and 62 gallons. At AHRI’s planning figure of 20 gallons per shower, that is four showers in the first hour against three. Replacing gas with electric of the same size? Compare first-hour ratings and consider a size up; see what size water heater you need.
What each fuel needs from your house
- Gas line: codes size gas pipe on the total load of everything it feeds (2024 IRC G2413.2).
- Vent: a standard atmospheric tank vents by natural draft up a metal vent or chimney with no fan or electricity, which Rheem calls the simplest, lowest-cost gas option. Power-vent models push exhaust through a wall and need a 120-volt outlet. See water heater venting.
- Combustion air: A.O. Smith’s manual counts a space as unconfined only if it has at least 50 cubic feet per 1,000 BTU/h of the appliances in it, so 2,000 cubic feet for a 40,000 BTU/h tank. Smaller rooms need openings.
- Location: under the 2024 IRC, fuel-fired heaters can’t go in a storage closet; bedroom and bathroom installs need a sealed enclosure unless direct vent; in a garage the ignition source must be at least 18 inches up unless the heater is listed as flammable-vapor ignition resistant.
- Electric circuit: the National Electrical Code sizes a storage water heater’s circuit at 125% of its rating. A 4,500-watt heater draws 18.75 amps (4,500 ÷ 240), so the circuit must carry 23.4 amps, which means the next standard breaker size of 25 or 30 amps. No vent, gas line or combustion air, so electric tanks fit closets a gas tank can’t.
In a power outage, only some gas heaters keep working
| Heater | Works without power? | Why |
|---|---|---|
| Gas tank with a standing pilot | Yes | Bradford White’s control runs on a thermopile heated by the pilot: “No need for external electricity.” |
| Gas tank with power vent or hot surface ignition | No | A.O. Smith’s power-vent model has no pilot and must be connected to 120 volts. |
| Gas tankless | No | Rinnai: its tankless heaters “will not operate” in an outage. |
| Electric tank or heat pump | No | Water already in the insulated tank stays warm for a while. |
Check your model for a power cord or electrical connection. On a well, the pump also needs power.
Safety: carbon monoxide for gas, heavy wiring for electric
A gas water heater depends on its vent to carry carbon monoxide (CO) outdoors. EPA lists back-drafting gas water heaters among household CO sources and advises a professional inspection of fuel-burning appliances every heating season. Deaths are rare: CPSC estimates about 5 a year linked to water heaters (2020–2022 average), out of 238 non-fire CO deaths a year from all consumer products.
- Fit a CO alarm in any home with a gas appliance. EPA calls it a backup, not a substitute for maintenance. Some states require one; California does for existing homes with any fossil-fuel appliance (Health and Safety Code 17926).
- Know the gas-leak drill. A.O. Smith’s manual: don’t light any appliance, don’t touch electrical switches or use a phone in the building, and call the gas supplier from a neighbor’s phone.
- Electric tanks have no flame or exhaust; their risk is the 240-volt wiring, a job for a licensed electrician. Scalding and a relief valve that must never be plugged apply to both. See water heater safety.
Emissions depend on where your electricity comes from
| Heater | US average grid | Range across grid regions |
|---|---|---|
| Standard gas tank | About 3,130 lb | Same everywhere |
| Same tank on propane | About 3,730 lb | Same everywhere |
| Standard electric tank | About 4,090 lb | About 1,290–7,450 lb |
| Heat pump | About 950 lb | About 300–1,730 lb |
Ember & Tank calculation. Fuels: EIA CO₂ coefficients (natural gas 116.65 lb per million Btu; propane 12.68 lb per gallon). Electricity: EPA eGRID 2023 rates (US 0.77 lb per kWh; mainland subregions from 0.24 in upstate New York to 1.40). CO₂ only: excludes methane leaks from gas supply and power-line losses. EPA’s Power Profiler shows your area.
A plain electric tank emits more CO₂ than a gas tank on the average US grid, and less only where the grid is below about 0.59 lb per kWh. A heat pump emits less than a gas tank in every grid region in EPA’s data. Gas burners also emit nitrogen oxides (NOx), a smog ingredient; the Bay Area’s air district attributes as many as 85 premature deaths a year there to pollution from gas water heaters and furnaces.
If your home runs on propane
Propane costs more per unit of heat than natural gas: $25.68 per million Btu in DOE’s 2025 figures against $14.37. A standard tank burns about 294 gallons a year, $690 at DOE’s $2.35. EIA’s survey for the week of March 30, 2026 averaged $2.67 a gallon nationally, from $1.64 in Nebraska to $4.71 in Florida.
- A heat pump beats a propane tank unless electricity costs more than about 24¢ per kWh for each $1 a gallon: 56¢ at $2.35 propane.
- Even a plain electric tank can win where propane is dear. Break-even is about 5.5¢ per kWh for each $1 a gallon. At Florida’s prices the electric tank would cost about $816 a year, the propane tank about $1,384.
- Where propane is cheap, propane wins against plain electric: about $483 against $688 at Nebraska’s prices.
Local rules on gas: what is actually in force
No federal rule bans gas water heaters, and most local rules target new buildings. As of October 4, 2026:
| Rule | What it does | Status |
|---|---|---|
| DOE efficiency standards (2024 rule) | From May 6, 2029, most electric tanks over 35 gallons must reach heat pump efficiency; atmospheric gas tanks get a small bump | In 10 CFR 430.32; not withdrawn |
| Bay Area air district, Rule 9-6 | Zero-NOx standard for residential gas water heaters when one is replaced; existing heaters unaffected | Set for January 2027. Proposed delay to January 2028 with exemptions; Board hearing November 4, 2026 |
| South Coast AQMD (Los Angeles area) | Proposed zero-emission standards for water heaters and furnaces | Rejected 7–5 on June 6, 2025 |
| New York All-Electric Buildings Act | No fossil-fuel equipment in new buildings of seven stories or less; larger ones from 2029; existing buildings exempt | Upheld by the Second Circuit June 30, 2026; enforcement had been paused for the appeal |
| Berkeley, California ordinance | Banned gas piping in new buildings | Held preempted by federal law (Ninth Circuit) |
Sources: 10 CFR 430.32; A.O. Smith on the 2029 rule; BAAQMD (July 14, 2026 release and Rule 9-6 page); South Coast AQMD; Spectrum News on the New York ruling. These rules are changing quickly; confirm current status with your local permit office.
Outside the Bay Area, nothing in this list stops an existing home from replacing gas with gas or electric with electric. If you live in the Bay Area, ask installers how Rule 9-6 applies after its compliance date.
A heat pump is the electric option that competes with gas
A heat pump water heater is an electric tank with a small heat pump on top that pulls heat from room air. DOE says it can be two to three times as efficient as a standard electric tank and “might have lower energy costs than a gas-fired conventional storage water heater.” It costs more to install ($2,500–$5,000 on Home Depot’s range), and ENERGY STAR recommends a space that stays 40°F–90°F with about 1,000 cubic feet of air.
Rheem notes some 120-volt models plug into a standard outlet and “may help avoid the cost of adding a new 240V circuit,” at the cost of slower recovery. The federal 25C tax credit ended for installations after December 31, 2025; check rebates for state and utility programs.
Which to choose
| Your situation | Usually the better fit | Why |
|---|---|---|
| Gas tank failed, need hot water now | Gas tank | Reuses the vent and gas line; lowest price |
| Gas now, time to plan, suitable space | Get quotes for heat pump and gas | Heat pump runs cheaper at most US prices but costs more to install |
| Electric now, no gas in the house | Heat pump if it fits, else electric | A gas line costs $1,500–$2,300 before venting |
| Electric now, gas already in the house | Heat pump or gas | Either runs far cheaper than plain electric |
| Big household that runs out | Gas tank or gas tankless | Faster recovery |
| Frequent outages, no generator | Standing-pilot gas tank | Heats without power |
| Expensive propane | Heat pump | Cheaper to run almost anywhere |
General guidance from the costs and requirements above; your prices, space and local code decide.
Staying with your current fuel is usually cheapest and fastest, especially in an emergency. Switching pays when running-cost savings, a remodel or a local rule justify the conversion; switching from gas to electric covers panels, wiring and capping the gas line.
Ask each installer
- The exact model, its first-hour rating and its yearly energy use
- Whether the existing vent, gas line or circuit can be reused, and the itemized cost if not
- Whether the gas model needs electricity to run
- Who pulls the permit, and whether local rules such as Rule 9-6 apply
Common questions
Is a gas or electric water heater cheaper to run?
A standard gas tank is cheaper to run than a standard electric tank: about $384 against $919 a year for a busy household at DOE’s national prices, and cheaper at state average prices in every state. A heat pump water heater, at about $214, is usually cheaper than both.
Is a gas water heater cheaper to install than an electric one?
For a same-type replacement, about the same: Home Depot publishes $1,600–$2,400 installed for either. Switching from electric to gas costs more because of the new gas line ($1,500–$2,300 on This Old House’s estimate) and venting.
Do gas water heaters work without electricity?
Atmospheric gas tanks with a standing pilot do; their controls run on a thermopile heated by the pilot flame. Power-vent tanks, models with hot surface ignition and gas tankless units need 120-volt power and stop in an outage.
Which lasts longer, gas or electric?
They are close. DOE’s 2024 rule analysis used average lifetimes of 14.5 years for gas tanks and 15.1 for electric tanks. Water quality and maintenance matter more than fuel; see how long water heaters last.
Is an electric water heater safer than gas?
An electric tank has no flame and no exhaust, so it can’t produce carbon monoxide. Gas water heaters are linked to few deaths, about 5 a year in CPSC’s 2020–2022 estimate, when they are vented and maintained properly. Homes with any gas appliance should have a CO alarm.
Can I replace a gas water heater with an electric one?
Yes. The installer caps the gas line, deals with the old vent and adds a 240-volt circuit if one isn’t there, or uses a 120-volt heat pump model. Check that the electric model’s first-hour rating matches your needs, since electric tanks recover more slowly.
Are gas water heaters being banned?
Not nationally. The Bay Area’s air district has a zero-NOx rule for replacement gas water heaters set for 2027, with a proposed delay to 2028, and New York’s all-electric law covers new buildings only. Ask your permit office what applies where you live.
Sources
Sources checked October 4, 2026. Prices, codes and rebates change. Check current details with your installer and local permit office.
- Cost to install a water heater (national installed ranges) ↗ · Home Depot
- How much does water heater installation cost? (updated June 17, 2026) ↗ · This Old House
- Energy conservation standards for consumer water heaters, final rule (Tables V.2 and V.8) ↗ · U.S. Department of Energy, Federal Register
- 10 CFR 430.32(d): energy conservation standards for water heaters ↗ · Cornell LII
- DOE residential regulations explained ↗ · A.O. Smith
- Representative average unit costs of energy (notice 2026-05899) ↗ · U.S. Department of Energy, Federal Register
- 10 CFR 430 Subpart B, Appendix E: water heater test procedure ↗ · Cornell LII
- 16 CFR 305.17: EnergyGuide label content for water heaters ↗ · Federal Trade Commission, via Cornell LII
- Electric Power Monthly, Table 5.6.B: average price of electricity by state, year to date ↗ · U.S. Energy Information Administration
- Natural gas prices: residential price by state ↗ · U.S. Energy Information Administration
- How do I convert natural gas prices to dollars per therm? ↗ · U.S. Energy Information Administration
- Heating oil and propane update (residential propane prices) ↗ · U.S. Energy Information Administration
- Carbon dioxide emissions coefficients ↗ · U.S. Energy Information Administration
- eGRID summary data (2023 emission rates by subregion) ↗ · U.S. EPA
- Power Profiler ↗ · U.S. EPA
- Residential atmospheric vent gas water heaters spec sheet (RG250T6N, ICON system) ↗ · Bradford White, hosted by Young Supply
- ProTerra hybrid electric heat pump spec sheet (PROPH50 T2 RH375-30) ↗ · Rheem, hosted by Unilog
- ProTerra plug-in heat pump water heater spec sheet (PROPH50 T0 RH120) ↗ · Rheem
- Worksheet for estimating peak hour demand/first hour rating ↗ · AHRI
- Performance Plus electric water heater spec sheet (XE50T09EL45U1) ↗ · Rheem, hosted by Home Depot
- Residential power-vented gas water heaters with hot surface ignition: installation and use guide (Feb. 2023) ↗ · A.O. Smith, hosted by Lowe’s
- Gas water heater types explained: atmospheric, power vent, direct vent ↗ · Rheem
- Residential tankless FAQ (power outages) ↗ · Rinnai
- Code Q&A: electrical requirements for water heaters (NEC 422.13) ↗ · EC&M
- 2024 IRC Chapter 28, Water Heaters (P2801.6) ↗ · International Code Council
- 2024 IRC Chapter 20, Boilers and Water Heaters (M2005.2) ↗ · International Code Council
- 2024 IRC Chapter 24, Fuel Gas (G2413 pipe sizing) ↗ · International Code Council
- Non-fire carbon monoxide deaths associated with the use of consumer products, 2022 annual estimates (May 2026) ↗ · U.S. Consumer Product Safety Commission
- Carbon monoxide’s impact on indoor air quality ↗ · U.S. EPA
- Protect your family and yourself from carbon monoxide poisoning ↗ · U.S. EPA
- Health and Safety Code §17926 (carbon monoxide devices) ↗ · California Legislature
- Heat pump water heaters ↗ · ENERGY STAR
- 120V vs. 240V heat pump water heaters ↗ · Rheem
- Heat Pump Water Heaters (archived copy, June 2026) ↗ · U.S. Department of Energy, Energy Saver
- Selecting a New Water Heater (archived copy, June 2026) ↗ · U.S. Department of Energy, Energy Saver
- Energy Efficient Home Improvement Credit ↗ · IRS
- Air District publishes draft changes to water heater rule (July 14, 2026) ↗ · Bay Area Air Quality Management District
- Rules 9-4 and 9-6: building appliances ↗ · Bay Area Air Quality Management District
- Proposed Amended Rules 1111 and 1121 ↗ · South Coast AQMD
- Court affirms New York’s all-electric buildings mandate (June 30, 2026) ↗ · Spectrum News
- New York’s All-Electric Buildings Act survives challenge and may go into effect this fall ↗ · Carter Ledyard & Milburn LLP