Electric Water Heating Costs

The domestic electric water heater may be either a tank-type or a tankless type.

Typical domestic tank-type water heaters range from 30 to 50 gallons and they require floor space to be installed. Tankless units are rated in gallons per minute (GPM) and range from 2 to 10 GPM. They can be wall mounted and located in reduced spaces.

You will find that electric water heaters are less expensive to buy than gas types even before considering the cost of gas ventilation and gas pipe requirements, but in most regions electricity is the more costly heat source. Tankless heaters may cost more, but are considered lower cost to operate with their higher efficiency.

The cost to install average electric water heating depends upon type, heating flow and tank capacity, preparation and special needs, and the labor rate.

In the following table the Labor Cost figure is what the able and prepared DIY persons should expect to save by performing the corresponding tasks.

Electric water heater replacement:  for 4 or 5 person home; includes old material removal and disposal, transport, new material and installation, equipment, and waste.

ItemUnit CostQuantityLine Cost
Water heater: 40 gallon tank, 240V, 9 kW.$297each1$297
Upgrade tankless: additional cost to install tankless unit; 5.3 gallons per minute, 240V, 27 kW, 2 bathrooms.$418each1$418
Upgrade electrical: install new circuit for upgraded tankless; 30 feet of ROMEX surface mounted cable, #6/3; 2 each 60 amp breaker into existing spaces; single outlet box and cover.$4.72per foot32$151
Removal: transport and non-hazardous dump fees.$45per CY1.5$68
Fees and Material Cost$934each1$934
+ Labor Cost (remove and dispose)$32per hour2$64
+ Labor Cost (install)$42per hour4$168
+ Labor Cost (upgrade tankless)$42per hour1$42
+ Labor Cost (upgrade electrical)$42per hour3$126
Total Cost$1,334each1$1,334

Other considerations and costs

  • These prices are for service in the immediate area of the provider.
  • Taxes and permit fees are not included.
  • Warranty extensions are available at extra cost.
  • Higher end models include Wi-Fi based monitoring and control devices.
  • Electric heaters are less of a location-planning challenge without venting or hard pipe, but the tankless units may require a special high power electric circuit.
  • The cost to operate the heater follows the cost of electricity in the region.
  • All types require strict compliance with all pertinent local codes and regulations.
  • Often times when a water heater requires replacement it turns out that the installation will need to be upgraded to latest codes and regulations regarding ventilation or earthquake preparation.
  • During contractor inspection the homeowner should be informed of any repair concerns like rot, and any cost to adapt the existing structure.

DIY considerations

  • In the very best of cases this installation may be suitable for the able DIY persons, but home insurance or local codes may require a licensed or certified installer.
  • In all cases there can arise issues best left to professionals to resolve on the spot.
  • A fairly complete plumbing tool set will be required, perhaps including a torch.


  • Craftsman Estimator Costbook, complete series year 2015.
  • Latest prices found on Home Depot and other vendor Web sites.
  • Literature review of DIY Web sites.

Cost to install electric water heating in my city

Cost to install electric water heating varies greatly by region. To get free estimates from local contractors, please indicate yours.