Water Heating

Water Heater Replacement Cost:
Heat Pump, Tankless & Local Quotes

Compare heat pump, tankless, gas, and electric water heater options, then verify current utility, state, and DOE rebate eligibility before you buy.

~$600/yr

Avg. Water Heating Cost

Up to 70%

Energy Savings (HPWH)

Rebate Check

Utility + State

2–4 yrs

Typical Payback

Water Heater Types & Costs Compared

Heat pump water heaters can be efficient, but the right choice depends on utility rates, space, wiring, fuel type, and current rebate eligibility.

Type	Installed Cost	Efficiency	Best For
Heat Pump (Hybrid)Recommended	$1,200–$2,500 installed	3–4× more efficient	Best efficiency; verify rebates
Gas Tank	$800–$1,600 installed	Baseline	Lower upfront, gas-connected homes
Electric Tank	$600–$1,400 installed	Similar to gas	Budget replacement, simple install
Tankless Gas	$1,500–$3,500 installed	24–34% more efficient	Unlimited hot water, small homes
Tankless Electric	$800–$2,000 installed	24–34% more efficient	Whole-home or point-of-use
Solar Water Heater	$3,000–$6,000 installed	50–80% solar offset	Hot climates; verify incentives

Current tax and rebate eligibility varies by project date, equipment, state, utility, and household qualification rules. Verify before budgeting around incentives.

Why Switch to a Heat Pump Water Heater?

For many homes replacing a standard electric tank, the comparison starts with operating cost, wiring, location, and current rebate eligibility.

The Energy Savings

A standard 50-gallon electric tank costs $550–$650/year to run. A heat pump water heater (HPWH) runs the same tank for $150–$200/year — a savings of $400+/year.

~$400/yr savings

The Rebate Check

Current federal credit rules changed after 2025. Ask contractors to separate equipment cost, installation cost, and any utility or state rebate assumptions.

Verify eligibility