The heater is only part of the bill. Labor, the permit, haul-away and any code upgrades the old installation was missing all add to it, and switching types can add more than the heater itself.
The heater itself
A Department of Energy guide lists industry-average equipment prices (not installed prices) of about $700 for a gas tank heater, $1,160 to $1,760 for gas tankless, $500 for an electric tank and $1,400 for an electric heat pump water heater. Treat these as a rough guide to the relative cost of each type; current prices vary.
What gets added on top
- Labor to remove the old heater and install the new one.
- The permit: in the City of San Diego, a simple no-plan permit for a tank swap; a plan-required permit for tankless.
- Code upgrades if the old install lacked them: earthquake straps, a drain pan where leaks could cause damage, an expansion tank on closed systems.
- For a tankless conversion: a larger gas line, new venting and an outlet, often the biggest extra cost.
- Haul-away of the old tank.
Comparing quotes
Make sure each quote covers the same things: the exact model and size, the permit, code upgrades, haul-away and warranty. A low quote that skips the permit or the straps is not a bargain.
General information, not professional or legal advice; follow your manufacturer's manual, and your installer and local permit office have the final word. Sources:U.S. Department of Energy, Building America: Transitioning to a Tankless Water Heater; City of San Diego, Plumbing/Gas Permit; California Plumbing Code sections 507.2, 507.5 and 608.3 (as summarized in a city water heater handout).
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