Gas vs. Electric Water Heaters: Which is Cheaper to Run?

When choosing a new water heater, you're often limited by the energy source already in your home. But if you have the choice, which one wins the efficiency battle?

Gas water heaters recover much faster than electric ones. A 50-gallon gas tank can heat up a fresh supply of water almost twice as fast as an electric one. If you have a large family, gas ensures you don't run out of hot water as often.

Electric heaters are nearly 100% efficient—all the energy goes into the water. Gas heaters lose heat through the vent. However, electricity is usually more expensive per unit than natural gas.

Despite being less 'efficient' in energy transfer, natural gas is generally much cheaper than electricity in most of the US. Operating a gas heater typically costs about 30% less per month than an electric model.

Exceptions: If you have solar panels or a Heat Pump Water Heater (Hybrid), electric becomes the clear winner for long-term savings.