How Much Does It Cost TWater Heatero Install a ?

Did you know that having hot showers can benefit your health? Scientists have proven that hot showers lower blood sugar levels and help you sleep better at night, along with a host of other things.

That’s why it’s even more devastating when your water heater breaks. No more delicious hot baths or showers. Or washing laundry and dishes with steamy water. Yuck.

When your water heater breaks or malfunctions, the first question that’ll pop into your is: how much does it cost to install a water heater?

With this water heater guide, you’ll learn everything you need to know about water heater installation.

What is A Water Heater?

As the name suggests, a water heater is a device that heats up the water. Many people take their access to hot water for granted, forgetting to maintain their water heater, often leading to them breaking.

But did you know there are several types of water heaters? The most popular and common water heater is a tanked one. Tank water heaters heat water to a set temperature and store the water in the tank until someone opens a hot water tap.

There are two types of tank water heaters, gas, and electric. They’re basically the same system, except for how the water is heated up. Electric water heaters use electric elements to heat the water in the tank up, similar to how an electric kettle works.

Gas water heaters function in a very similar way. Instead of elements though, this system uses gas and a type of chimney to heat the water in the tank up.

There are also tankless water heaters on the market. They’re also known as on-demand water heaters, as they only supply hot water when needed. Tankless systems work very differently from tanked ones, although they also use gas or electric elements.

Cold water simply flows into the small heating unit, where it’s heated up by either electric or gas-powered elements. Thanks to this innovation, tankless systems create an endless supply of hot water without the need to store any in a tank.

Tankless systems have several benefits, including their small, space-saving size and their long lifespan. These systems are also highly sought after because they can save you around $180 a year, despite the endless water supply.

But they’re incredibly expensive to install, requiring quite a big upfront investment.

Depending on the type of water heater you opt for, your overall cost will vary.

What About Energy Efficient Water Heaters?

There are several energy-efficient water heaters, most of which are tanked systems. If you’re wanting to be more environmentally conscious, then these options may be the perfect fit.

Solar Power Water Heaters

Solar polar water heaters use the sun’s energy to generate heat, which in turn heats up the water in the storage tank. As we know though, rainy, cloudy days happen more often than we’d like, so these systems often rely on traditional water heating systems as a backup.

There are two types of solar power water heaters: active systems and passive systems.

Active systems use a pump to move water around the home, whereas passive systems depend on natural convection.

Hybrid Heat Pumps

If you’re wanting efficiency, then look no further than a hybrid heat pump. Unlike other tank systems, these generate hot water seemingly out of thin air.  They use the heat from the surrounding air to heat the water in the tank, using a compressor and coils.

As wonderful as these are, they are also the most expensive water heating system on the market.

Indirect Water Heaters

Indirect water heaters are a great option for the environmentally conscious on a budget. These systems use the energy generated from a boiler or furnace to heat the water in the tank.

It does this by directing the boiler’s water to the tank’s coils, which heat up the water inside. This water heating system is cheaper than other environmentally friendly options but still pricier than your traditional water heater tank.

Water Heater Installation Costs

Replacing your water heater is no easy job. It’s not a cheap one either. The cost of installing a water heater can range anywhere from $900 to well over $2000 or more. This usually includes the unit you want and the labor costs.

Depending on your situation, you may need to fork out an additional $40 to $200 an hour for a plumber.

Several factors affect the cost of water heater installation. Let’s break them all down, so you can make the right water heater choice for your needs, and wallet.

Water Heater Type

As mentioned, the various water heating systems vary in price. So, depending on your budget, you might not be able to get the super-efficient hybrid heat pump system.

The cheapest water heating unit is a traditional tank system. The average cost of installation is anywhere between $800 and $1300. Electric water heater tank systems are the most affordable.

Your tankless systems are slightly more expensive than a tanked system. Depending on which system you opt for, the installation costs range between $1200 and $3500. Their upfront costs often outweigh all their benefits.

Unfortunately, wanting to save the planet comes at a price.  Energy-efficient water heating systems are some of the most expensive options to go for.

Indirect water heaters are, to an extent, the perfect choice for those who’re energy conscious on a budget. They normally cost around $1500 to install, which may put it slightly out of reach for many.

Solar power heating systems can cost you $2000 or $3000, depending on which system you opt for. Active systems are more affordable than passive systems. The latter are more expensive as they need a backup water tank, and installation requires extensive labor.

A hybrid heat pump system, on the other hand, can cost anywhere between $1200 and $3500.

Size of The Water Heater Tank

If you opt for a tanked system, you’ll also need to be aware of the size of tank you need. Different tank sizes have different costs. The bigger the water heater, the more expensive it will be.

A 30-gallon tank will cost you over $250. A 40-gallon costs around $300 or more, while an 80-gallon tank costs over $1000. Unfortunately, you can’t just opt for the smallest tank to save money.

The size of the tank you require depends on the size of your household. A 40-gallon tank is just big enough to serve a two-person household.

Venting system

If you opt for a gas water heating system, you’ll also need to invest in a venting system. Because gas systems aren’t sealed, gas can still enter your home. You need a venting system to direct the gas out of your home.

There are two ways to vent your home: power venting and direct venting.

A power venting system uses several motorized fans to move gas out and away from your home. Thanks to all these motorized fans, this system costs a lot more than its alternative.

A direct venting system uses piping to allow gasses to passively allow the gasses to move out of your home. The simplicity of direct venting systems allows them to cost $1000 less than power ventilating systems.


The cost of labor will also vary depending on where your water heater is situated in your home. If your heater is positioned in an odd, hard-to-reach place, like an attic, you may be charged extra for labor.

The installers may also up the costs if they have to climb several flights of stairs, lugging their tools, materials, and the water heater unit.


Building on the previous section, you may also be liable for any additional materials needed during the installation process. Especially if the unit is in an odd spot in your home. These materials include vents, pressure valves, and pipes.

Local Permits

If you’re changing your water heater unit or relocating it – which will cost extra by the way – you may need permits. Depending on your area, what unit you’re installing, or where it’s being relocated to, you might need a few of these permits.

Unfortunately, obtaining these permits come at an extra cost that you should consider.

Gas Line Installations

If you’re changing your water heating unit from an electrical system to a gas one, you’ll need gas lines installed. These installations can cost between $200 and $900, depending on the location of the water heater.

Water Line Installations

Moving your water heater unit to a different spot might be in your best interest. For example, moving it from your attic to the outside reduces damage to your home in case of a leak.

But this might make the installation more expensive if you need to run additional water lines. Water lines can cost as much as $1000.

Added Costs

While several known factors affect the price of a water heater installation, you should always prepare for the unknown. As with any home project, there will always be added costs that come out of the woodwork.

Disposal of old unit

Installing a new water heater will leave you with a spare that often won’t work. Unfortunately, not all installation companies will remove and dispose of your old unit. So, you’ll need to find a removal or disposal service that will.

This will come at an extra cost that you need to bear in mind.

Carpentry work

Changing or upgrading your water heater system is great. But it might require some carpentry work. Sometimes, the new system needs extra reinforcements or making the space bigger for a bigger unit.

If the work is extensive, you might need to hire a professional carpenter, over and above a plumber. This ultimately drives up labor costs.

Fixing existing issues

Any plumber worth their salt will fix any existing leaks and issues at no extra cost. But if these issues are bad and require a lot of extra time to repair, they may add on a few extra hours of labor.

Water Heater Installation Tips

When it comes to water heater installations, it’s always best to get it professionally done. The installation process is complicated, and as you can see, there are so many factors affecting the installation.

You don’t always know what electric water heater parts, or any other materials, you might need during the process. For peace of mind, stick with the professionals.

But there are a few things you can do before the installation process to make everything go smoothly.

  • Decide if the water heater unit needs to be relocated
  • Choose the right water heater unit for
    • Your home’s size
    • The available fuel/power
    • Your budget

When choosing a new water heating system, it’s also important to weigh the upfront cost of the unit with its monthly cost. As mentioned, some units are exceptionally expensive off the bat but have the potential to save you hundreds of dollars in the long run.

When to Replace Your Water Heater

Water heater replacements are inevitable. They’re not meant to last forever, and several factors could shorten a water heater’s lifespan. The main factor is the lack of maintenance.

Sometimes, it’s better to replace or fix a water heater unit as soon as it starts showing problems. Otherwise, you might have a few more water problems on your hands that just no hot water.

Here are a few signs of a failing water heater system:

  • Leaks
  • Strange, loud noises coming from the unit
  • Discolored water
  • Odd tasting water
  • Water taking longer than usual to heat up
  • A unit that’s nearing 20 years old

How Much Does It Cost to Install a Water Heater?

The answer to the question, “how much does it cost to install a water heater?” is rather simple – a lot of money.

But several things affect this cost, and having a properly installed water heater system will save you a headache in the long run. And not just because hot showers reduce them and improve your respiratory system.

If you’re interested in other home and lifestyle articles, head on over to our blog.

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