Water Heater Replacement Cost
Table of Contents
The cost to replace a water heater depends on many factors. These include the type of water heater, its size and capacity, and the complexity of the installation. Other points to consider are the cost of fuel and monthly running costs. In this guide, we talk about the different types of A.O. Smith water heaters, water heater costs and factors that influence the total cost of hot water heater replacement.
Water Heater Type
New water heater costs depend on the type of heater installed. Commercial water heater prices are higher than residential prices. Tankless and heat pump models cost more to buy, but their lower monthly running costs offset the initial water heater cost and installation. Find the best water heater replacement for your home with our residential water heater selection tool.
Residential Water Heaters
Residential water heaters are sized appropriately for domestic applications. Options include both tank and tankless in various fuel types, like liquid propane gas, electric, and natural gas. Features of residential water heaters include A.O. Smith's patented glass tank lining, DynaClean sediment removal, anode rod protection and electronic controls.
Commercial Water Heaters
Commercial gas and electric water heaters are larger than residential units. A.O. Smith electric commercial water heaters have heavy-duty heating elements for faster hot water recovery rates and commercial-grade anode rods for better corrosion protection. Size for size, the commercial hot water heater cost is more than for a residential water heater.
Tank Water Heater
A tank water heater consists of a large glass-lined tank fitted with one or more heating elements or, if gas-fired, with a burner. Sized from 6 gallons to 80 gallons, tank heaters preheat and store hot water so that it's available on demand. Tank water heaters are simple, reliable and easy to install. A 36-gallon electric tank heater costs around $400, and larger 55-gallon units cost up to $750. Gas tank heaters are slightly more expensive.
Tankless Water Heater
Tankless water heaters are on-demand heaters They are energy efficient, using less energy than equivalent tank water heaters. Electric tankless heater prices go from $400 to $700. Gas tankless water heaters cost between $700 and $1,800.
Heat Pump Water Heater
Often referred to as a hybrid electric water heater, this type uses a heat pump to heat the water. While relatively expensive at between $2,000 and $3,000, hybrid water heaters are four times as efficient as hot water tanks. They can reduce energy bills by up to $600 per year and offset the higher purchase price. Buyers are eligible for up to $2,000 in federal tax credits and up to $850 in local utility rebates.
Combi Boiler
A combi boiler is an all-in-one water and space heater. A.O. Smith combi boilers are ENERGY STAR® certified and have an Annual Fuel Utilization Efficiency (AFUE) of 95%. They provide more heating capacity than other types of combination boilers and comply with Ultra-Low NOx emission requirements. Although more expensive than gas tank heaters, combi boilers cost less to run.
A circulating water heater continuously circulates hot water to provide it instantly. Primarily intended for large commercial applications, circulating water heaters have a high thermal efficiency of up to 98% and incorporate a burner-modulating system with a turn-down ratio of 10:1.
Indirect Water Heater
A.O. Smith indirect water heaters have an internal heat exchanger supplied with heat from an external source such as a solar panel or geothermal heating system. A supplementary electric heating element maintains a constant water temperature at night and when solar energy isn't available.
A.O. Smith's Product Line
The A.O. Smith product line is diverse, covering almost every possible water heating application. Water heater products fall into various families, each covering a distinctive market niche.
ProLine®
The ProLine® family is A.O. Smith's standard line of gas and electric water tank heaters intended for residential applications. They feature good hot water recovery rates and high-efficiency ratings. Some models are mobile home compatible. They offer a good blend of performance and price and have excellent 6- and 10-year limited tank warranties. Standard features include Blue Diamond glass tank lining, Incoloy stainless steel elements and Coregard anode rods.
ProLine® Master and XE
A.O. Smith's premium ProLine® Master water heaters feature commercial-grade components and advanced features such as leak detection and automatic shut-off technology. They have an enhanced 8-year limited tank warranty. Proline XE water heaters incorporate high-efficiency technologies, and the range includes heat pump and tankless water heaters.
Vertex
This is a range of high-efficiency gas-condensing residential water heaters with ENERGY STAR® certification. All Vertex water heaters feature electronic controls with diagnostic capabilities. These units have an overall thermal efficiency of up to 96%. The range includes direct vent and power vent models, as well as Low NOx and Ultra-Low NOx units. Vertex water heaters are notable for their excellent first-hour heating capacities and hot water recovery rates.
Voltex
The Voltex brand of heat pump water heaters sets new standards for thermal efficiency and energy usage. Models typically achieve a Uniform Energy Factor (UEF) of around four, compared to a standard tank heater with a UEF of less than one. This difference represents a huge energy saving, and it's possible to recover the higher initial cost of Voltex hybrid heat pump water heaters within a few years.
XP Plus
A.O. Smith's XP Plus range of commercial circulating water heaters has stainless steel heat exchangers and a condensing design that results in a thermal efficiency of up to 98%. Fueled by natural gas or propane, XP Plus circulating water heaters produce up to 4,785 gallons per hour of water with a 100-degree Fahrenheit temperature rise. They are ENERGY STAR® qualified and compatible with building management systems using the BACnet and MODBUS protocol.
Polaris
This is a high-efficiency gas tank heater fitted with a powerful burner for high hot water recovery. The Polaris range comes in 34- and 50-gallon versions and has a 90-degree Fahrenheit hot water recovery rate of up to 253 gallons per hour. The tank and heat exchanger are made from 444 stainless steel for added corrosion protection. Polaris condensing units have an Ultra-Low NOx modulating gas burner.
Signature Series
Sold exclusively through Lowe's direct-to-consumer channels, A.O. Smith's Signature Series is a comprehensive range of gas and electric hot water heaters. Offering excellent value for money, the Signature Series has similar specifications to Proline water heaters at a lower price point. Lowe's also offers professional installation services.
Water Heater Size and Capacity
A water heater should be correctly sized to meet the expected hot water demand. Factors that influence the capacity of the water heater include the size of the home, the number of people living there and their water usage. Our water heater product selector helps estimate the best water heater for your home. Alternatively, you can use the Pro-Size water heating calculator for commercial applications. Popular hot water tank sizes include the following:
30-39 Gallons
This range represents the smallest water tank heaters suitable for residential use. They are best for small households of one or two people with low hot water requirements.
40-49 Gallons
A slightly larger water heater with a faster hot water recovery rate for small households with medium hot water demands. This could include back-to-back showering and the use of the bathtub. This size is best for a two-person household.
50-74 Gallons
This range is suitable for families of up to four people, especially those who like long showers and baths. A water heater of this size can supply sufficient water for laundry and dishwashing purposes.
75+ Gallons
These large water tank heaters are ideal for larger families and those who like long hot baths or showers with high-pressure shower heads. They have excellent hot water recovery and storage capacities to ensure plenty of hot water for everyone, including for laundry and dishwashing appliances.
Power Source and Fuel Types
Gas
Gas water heater prices are higher than equivalent electric water tank heaters. However, the monthly cost of running a gas water heater is lower. They can run on natural gas or propane.
Natural Gas
Natural gas prices are very seasonal. The US Bureau of Labor Statistics reported that the October 2023 price of natural gas was $1.388 per therm. Assuming an atmospheric vent gas water heater with a UEF of 0.55, the annual gas water heater cost for a family is $315 and with a high-efficiency condensing gas heater with a UEF of 0.88, the cost is $202.
The most common fuels for water heating are electricity and natural gas. According to the U.S. Energy Information Administration, approximately 38% of homes have piped natural gas. Other fuels include propane, oil and solar. The costs of each fuel vary across the United States and seasonally with demand. To compare the annual cost of different fuels, we have assumed an average hot water usage per family of 64 gallons of hot water per day.
Electric
Electricity is relatively expensive compared to other energy sources. The US Bureau of Labor Statistics estimates that the average cost of electricity per kWh (October 2023) is $0.169. Based on this figure, the annual cost of hot water for an average family using an electric water heater with a UEF of 0.93 is $668.
Hybrid Electric
The running cost of a hybrid heater with a UEF of 3.8 is approximately a quarter of a standard electric tank heater, so the equivalent annual water heating cost for a family is $176.
Propane
Propane is sold by the gallon. It is more expensive than natural gas but has more energy. At $2.50 per gallon, the annual hot water cost using a standard propane tank heater with a UEF of 0.61 is approximately $403.
Solar
Solar power is free, but in practice, solar water heaters need supplementary power for heating at night and on cloudy days. The Energy.gov website estimates that the solar efficiency ratio varies between 2 and 2.9. The SEF is broadly equivalent to the UEF and with a solar water heater with electrical backup, the approximate annualized cost to heat 64 gallons per day will be between $214 and $315.
Vent Type
Gas and propane-fired water heaters require vents to remove dangerous gases created during the combustion process. These include carbon monoxide and nitrous oxides. The vent design depends on the type of gas water heater. Installation of vents should only be done by a professional installer who will check for safe vent operation. Depending on the type and length of the vent, the installation cost of a new vent could be somewhere between $500 and $1,000.
Standard Atmospheric Vent
This common type of vent is a vertical or upward-sloping metal ducting that discharges the hot gases through the roof of your home. Metal ducting is needed because of the hot exhaust gases. The cost of metal exhaust ducts is relatively high, especially for longer lengths.
Direct Vent
Direct vents are used when there's insufficient ventilation around the water heater for proper combustion. A direct vent has a pipe-in-pipe coaxial pipe. The outer pipe brings in fresh air for the burner, while the inner pipe vents exhaust gases. Corrugated flex coaxial vent piping is supplied with the water heater and is included in the price. A variant of direct venting for mobile home applications has a separate inlet vent pipe that draws the combustion air from outside and a vertical exhaust vent through the roof.
Power Vent
A power vent water heater has a small blower that drives the exhaust through the vent to the outside. Power vent water heaters have a helical heat exchanger that extracts waste heat from the exhaust gases for improved efficiency. Power vent piping uses cheaper PVC piping and does not have to run vertically. It is essential to correctly position the external vent pipe to prevent exhaust air from being drawn into the home. Always consult a professional install
Power Direct Vent
A power direct vent works on the same principle as a direct vent, except it uses a small blower to draw fresh air for combustion from outside. The same fan blows the exhaust gases outside. As with the power vent, you can use PVC or polyethylene vent piping.
Concentric Vent
A concentric vent refers to any pipe-in-pipe vent where the inner pipe is for the exhaust gases and the outer pipe supplies fresh combustion air. This form of venting is common with tankless gas water heaters.
Other Costs to Consider
When answering the question of how much does a water heater cost, you should include other costs such as shipping, installation, utility upgrades and permits. Here's a list of additional hot water heater replacement costs to consider.
Removal and Disposal of the Old Heater
Don't overlook the removal and disposal of the old water heater. A tank water heater is heavy and may need special equipment to remove it from your loft or basement. Allow at least $100 for this and, if access is difficult, as much as $400.
Home Renovations and Tank Relocation
Water heater replacement is a good opportunity to do changes and renovations. Additionally, some additional costs are inevitable, such as if the contractor has to remove a wall or relocate the water heater to a different position.
Fuel Conversion
If you're converting from electricity to gas or installing a gas tankless system, allow for the costs of running new gas lines. An approved professional must do gas line installation.
Extended Warranty
A.O. Smith water heaters have excellent warranties. Some units have a 5-year limited warranty, others have an 8-, 10-, 12- or 15-year limited warranty. It's best to check your warranty on the warranty verification webpage. Extended warranties of 2 and 5 years can be bought.
Repairs and Maintenance
Most water heaters require annual maintenance. This includes checking items like the T&P relief valve, anode rod and vent system. An annual maintenance contract will ensure the water heater is kept in peak condition and give peace of mind should anything go wrong. Alternatively, search for an approved heater repair and service provider near you.
Shipping Costs
Water heaters are bulky, so if you're buying from a wholesaler, allow for transport costs from the wholesaler to your home. Prices vary depending on weight and distance. Shipping costs vary from $100 for in-state shipping and up to $400 for cross-country shipments. Alternatively, save on shipping by buying from an A.O. Smith-verified plumber in your area.
Installation Costs
For one-for-one water heater replacement, allow around $200 to $400 for installation costs. This figure assumes easy access and minimal new installation work. If there are major changes, then expect costs to be nearer $1,000. You will pay more for the installation of a tankless water heater. Before going ahead, get an estimate from an approved A.O. Smith water installer near you. DIY installation is not recommended, as there are many technical and regulatory factors to consider, and improper installation may void your warranty.
Electrical Upgrades
If you are switching to an electrical tankless system, you may have to upgrade your electrical service panel. Electric tankless heaters require between 100 and 140 amps, depending on the model.
Permits and Inspection
Installation of gas appliances, plumbing changes and electrical installations generally require a permit from local authorities. Permit costs differ, but in total, they may come to between $100 and $500.
Expansion Tank Installation
Many cities require the installation of an expansion tank. The tank accommodates the expansion of water as it heats up and relieves stress on the water heater and plumbing. You must have one if there's a check valve or pressure-reducing valve on the water line. Expansion tanks cost less than $100 and are installed in the cold-water line near the water heater.
