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Tankless water heaters heat water as it passes through the unit instead of storing heated water in the tank. Their ability to produce hot water on an as-needed basis makes them more efficient. However, they are generally more expensive than traditional units. Is a tankless water heater worth it? Most homeowners will save money with a tankless unit in the long run by using less energy.

The right way to vent a gas water heater is to have a pipe directly upward or slopes upward out of the house. Because hot air naturally rises, this type of venting will efficiently ensure that all gas moves out of the house. Your system may rely on fans or blowers as well.

Electric water heaters use a high amount of electricity, so they’re best for homeowners who subsidize their electric bill with solar or who live in an area with inexpensive electricity. For others, gas water heaters versus electric water heaters may be the more cost-effective solution, with the added bonus of heating water quickly and efficiently. No matter which you choose, you can lower your water temperature as low as possible to keep costs down.

The average cost to replace a water heater is around $1,325, with a typical range of $900 to $1,800 for a standard replacement. The final price depends on the type of heater (tank vs. tankless), its size, fuel source (gas or electric), and the complexity of the installation. A simple one-to-one replacement will be on the lower end of the cost spectrum. However, if you are switching from one type of heater or energy source to another, you can expect labor costs to be significantly higher due to the extra work involved. It's also worth considering that while gas and electric heaters may have similar upfront costs, their long-term operating costs can differ based on local utility prices.