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Buying A Water Heater? Here’s What To Buy If You Want To Save Money in the Long Run.

In this article, you’ll find out what to look for when you’re buying a water heater that will help you get the lowest possible energy bill when it comes to water heating.

Everyone wants to save money. It’s especially true when it comes to home appliances. In this article, you’ll find out what to look for when you’re buying a water heater that will help you get the lowest possible energy bill when it comes to water heating.


The key takeaways from this article are:

  • Tankless water heaters are more efficient than tank water heaters.
  • Tankless water heaters last longer, so you’ll save money by not replacing them.
  • In general, gas water heaters are cheaper on a monthly basis than electric heaters.
  • Always go with a professional-grade water heater over a big box store.
  • Look for a rebate!

First, you’ll find out some of the differences between gas and electric water heaters.

Gas vs. Electric Water Heaters

A good rule of thumb is that gas models are less costly than electric models on a month-to-month basis. The reduced monthly cost is due to the overall lower price of gas as compared to electricity. These rates vary depending on gas and electricity rates where you live, but we’ll give you a quick example.

One test from Consumer Reports found that a gas water heater costs $245 a year to run.  If that water heater were electric, you’d end up paying $580 a year for the same amount of output. That’s almost a 100% price increase on the same amount of hot water! Take note; if you have a large family and use a lot of hot water, that difference could end up being way more than $235 a year.


Another factor is that comes into play is groundwater temperature. If you live in a cold climate, like here in Minnesota, you’ll end up using a lot more energy (and money) to heat your water. That means that your efficiency rating and energy savings will be even more crucial when it comes to how much money you’ll spend in the long run.

Tank vs. Tankless Water Heaters

Another rule of thumb is this: Tankless heaters will always be more energy-efficient and cost less per month than tank heaters. 


Tankless water heaters are, generally speaking, more efficient than tank water heaters. For example, the previously mentioned test from Consumer Reports found that while the gas tank water heater costs $245 a year, the gas tankless water heater costs $195 a year. Efficiency is nice because the costs are less, but the bonus is that the tankless unit can help you conserve natural resources like water and gas. If you get a tankless unit with recirculation, hot water is immediately available from your tap, so you don’t have to waste water while waiting for the hot tap to get hot. That means you’re going to get more use out of the water and gas that your home uses. This is a case where being environmentally friendly can mean getting some nice financial savings.

Monthly cost-saving on a tankless water heater offsets the fact that they are more expensive to install. But then the cost is offset again by the fact that you might be able to get a significant rebate on tankless heaters. The rebate for a gas tankless heater can be $200 or even more than for a gas tank heater. Because they use less energy, tankless heaters are more environmentally friendly than tank heaters. That’s why you can find better rebates on this type of heater from the government and the Energy Star Program. Use this link to find a rebate offered near you.

On that note, in case you didn’t already know, here’s your sign: 


See if your heater qualifies for an available rebate.


If you’re lucky and it’s available, a rebate is essentially free money that you can get when you buy a new water heater. Think of it like this: Someone comes up to you holding a wad of cash and says, “Oh man, I’ve got too much cash. Would you like $150 dollars?” Then you say, “No thanks!”. That’s what going without an available rebate is like.

Life of the Water Heater

While your water heater’s life span doesn’t play directly into the energy bill month to month, it is invaluable to keep in mind. It’s important to know your water heater’s cost of ownership and monthly costs because it can be a crucial decision-maker when you determine what kind of water heater you buy. When buying a water heater, you need to be aware that it’s not something you can buy once and will last forever. Many water heaters only last for a few years. After a while, the lining of the water heater corrodes from the hot water inside it. You need to account for the fact that eventually, you’ll need to replace your water heater. The frequency with which you have to replace it depends on what kind of water heater you buy and how well you take care of it.


To make sure you get a water heater that lasts as long as possible, you need to remember three things:

  1. Take proper care and maintenance of your water heater.
  • Many people don’t know this, but you need to flush your water heater once every 1-3 years, depending on your water hardness. If you don’t, sediment will build up within your water heater and make it inefficient and break down more quickly. Here’s an article you can refer to with instructions on how to flush your water heater. Additionally, if anything happens or your water heater doesn’t work, you can take advantage of your water heater’s parts and/or labor warranty if you get a professional-grade water heater.
  1. Tankless water heaters last longer than tank heaters.
  • Because tankless heaters don’t have hot water on standby, they are prone to far less corrosion than tank heaters. Ultimately, this means that they will last about twice as long, and you won’t have to spend more money to replace your water heater. It’s worth remembering that tankless water heaters are far more efficient than tank water heaters, and you’ll end up seeing some savings in your monthly energy bill to soften the upfront cost.
  1. Professional grade water heaters are better than box-store water heaters.
  • We’ve said it before, and we’ll say it again. Water heaters from big-box stores are more defective, built more poorly, and don’t have warranty coverage like professional-grade water heaters. Box store water heaters will come with a sticker that tells you not to contact them if you need it fixed. You’d have to go directly to the manufacturer. On the other hand, if you install a water heater with us, you can call us for warranty coverage, and we’d be happy to help. Water Heaters Now only installs professional-grade water heaters for this reason and many others. We certainly don’t recommend anyone get a box-store water heater because they’ll end up forking over more money in the long run to replace or maintain it. Once you start looking into higher-quality water heaters, you’ll find warranties of 6+ years. Water Heaters Now offers an extended 10-year warranty for Bradford White water heaters.

So what’s the most cost-effective choice in the long run?

In truth, this is hard to determine as a one size fits all choice. That said, we can still leave you with some crucial bits of information.


Once again, the key takeaways from this article are:

  • Tankless water heaters are more efficient than tank water heaters.
  • Tankless water heaters last longer, so you’ll save money by not replacing them.
  • In general, gas water heaters are cheaper on a monthly basis than electric heaters.
  • Always go with a professional-grade water heater over a big box store.


And of course,

  • Look for a rebate!


If you’re still uncertain or you’d like help choosing a water heater, give us a call! One of our professional water heater experts would be happy to help you choose the best option for you and your family. If you call before 2 pm on a weekday, we can even install a tank heater on the same day.


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