Why this page is arithmetic and not a quote
Neither source publishes a lifetime cost of ownership. Both publish the pieces: purchase price, running cost, expected life, maintenance. Nobody adds them up.
This page does the addition and shows its working, so you can disagree with any input. Every figure below is published by Fixr or This Old House; every total is ours.
The inputs
For a 50-gallon-class unit, the common size for a household of three to five:
| Type | Installed | Per year to run | Expected life | Source |
|---|---|---|---|---|
| Electric tank | $700 to $1,900 | $600 to $750 | 8 to 12 years | Fixr |
| Gas tank | $900 to $2,500 | $325 to $475 | 8 to 12 years | Fixr |
| Heat pump hybrid | $2,000 to $5,500 | $225 to $350 | 10 to 20 years | Fixr, This Old House |
| Tankless, gas | $1,650 to $3,500 | $192 to $264 | 15 to 20 years | This Old House |
| Tankless, electric | $650 to $2,500 | $300 to $540 | 15 to 20 years | This Old House |
Maintenance, from both sources: a tank flush at $100 to $250, an anode rod at $125 to $300 every few years, tankless descaling at $100 to $500 a year. Call it $150 a year for a tank and $200 a year for tankless as a working figure, which is our simplification of ranges the sources give per job rather than per year.
The 20-year calculation
Twenty years is the right horizon because it is roughly one tankless or heat pump unit, and two tanks. That replacement is the number people leave out.
Using mid-range figures throughout. All totals are ours.
| Type | Purchase | Replacements | 20 years running | 20 years maintenance | Total |
|---|---|---|---|---|---|
| Electric tank | $1,300 | one more, $1,300 | $13,500 | $3,000 | $19,100 |
| Gas tank | $1,700 | one more, $1,700 | $8,000 | $3,000 | $14,400 |
| Heat pump hybrid | $3,750 | none | $5,750 | $3,000 | $12,500 |
| Tankless, gas | $2,575 | none | $4,560 | $4,000 | $11,135 |
| Tankless, electric | $1,575 | none | $8,400 | $4,000 | $13,975 |
Subtract the federal tax credit where it applies: up to $2,000 on a certified heat pump brings that row to about $10,500, and up to $600 on a qualifying gas tankless unit brings that row to about $10,535.
What the table actually shows
The purchase price is the smallest number in every row. It ranges from $1,300 to $3,750 across the table, while running cost ranges from $4,560 to $13,500. Choosing on sticker price is optimising the least significant term.
The cheapest unit to buy is the most expensive to own. A standard electric tank has the lowest entry price of any tank on Fixr's figures and the highest 20-year total here, by about $4,700 against a gas tank and $8,000 against a gas tankless unit.
Replacement is a real line. Two tanks in twenty years adds $1,300 to $1,700 that a tankless or heat pump owner does not spend, plus a second installation disruption and a second chance of an emergency failure.
Maintenance is not the deciding factor. At $3,000 to $4,000 over twenty years it is real money, but it does not reorder the table. It is also the one column you partly control: the flushing and anode rod work is what keeps a tank at the top of its 8-to-12-year range rather than the bottom.
Where this calculation breaks
Being honest about the limits matters more than the totals.
Fuel prices are not constant for twenty years. Every running-cost figure here is a 2026 national average. Neither source forecasts, and neither do we.
Your utility rate is not the national average. Fixr's own figures put an electric tank at 3,600 to 4,800 kWh a year; multiply by your rate and you will get a different number from the table. See running cost per month.
The heat pump figure assumes the heat pump works. In a cold space it falls back on its electric elements and the running cost drifts toward the electric tank row. See heat pump water heater cost.
Infrastructure costs are not in the table. A gas tankless unit may need $350 to $800 of gas line work and $400 to $800 of venting. An electric tankless unit may need a $1,000 to $2,000 panel upgrade. Either can add a four-figure sum to its row. See tank to tankless conversion cost.
The heat pump row assumes no replacement in twenty years. Its published life is 10 to 20 years, so at the bottom of that range you would buy a second one and the row rises by roughly $3,750. We used the optimistic end and are flagging it rather than hiding it.
Tax credit terms change. The $2,000 and $600 figures are what This Old House reported in mid-2026.
Money now is worth more than money in fifteen years. We have not discounted anything. A household that cannot spend $3,750 today is not being irrational in buying the $1,300 unit, and no table changes that.
The short version
If you have a gas supply and expect to stay in the house: a gas tankless unit has the lowest total here, and gas tank second.
If you are on electricity: a heat pump beats a standard electric tank by about $6,600 over twenty years on these figures, and by about $8,600 once the tax credit is counted, and the entry price gap is the only argument against it.
If you are selling in three years: none of this applies. Buy the cheapest unit that meets code and spend the difference elsewhere.
That last line is the honest one, and it is why this page is arithmetic you can check rather than a recommendation.
Related: running cost per month, rebates and tax credits, efficiency ratings explained.
Sources
- Fixr, How Much Does It Cost to Install a Water Heater? [2026 Data], updated January 27, 2026
- This Old House, How Much Does Water Heater Installation Cost? (2026), updated June 17, 2026
- Fixr, 50-Gallon Water Heater Installation Cost in 2026, updated January 26, 2026
Price figures are national US ranges from the sources above as of the date shown. Your local price depends on labor rates, permits and site conditions. Read how we get our numbers.