The Best Water Heaters of 2022

Find out what features you should look for in a new hot water heater and don’t miss our list of some of the best units you can buy.

By Tony Carrick | Updated Aug 24, 2022 11:22 AM

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The Best Water Heaters Option

Photo: amazon.com

It used to be that there weren’t many options when it came to purchasing a hot water heater. The only two choices were gas or electric. With the advent of new technologies, the hot water heater landscape has changed, with more options on the market than ever. In addition to gas and electric tank water heaters, buyers can also consider tankless and hybrid water heaters.

All these options might make you feel like you’re in deep water when it comes to making the right decision. Read on to learn about the factors to consider when choosing the best hot water heater for your home. We scoured the market and researched top-rated water heaters in a variety of categories. We did a deep dive into the specifications, features, and customer reviews to assemble this list of top picks.

  1. BEST OVERALL: Rheem Performance Platinum 50 Gal. Water Heater
  2. RUNNER UP: A.O. Smith Signature 50-Gallon Natural Gas Heater
  3. BEST BUDGET: Rheem Performance 50 Gal. Electric Water Heater
  4. BEST TANKLESS ELECTRIC: Stiebel Eltron Tankless Water Heater, Electric
  5. BEST TANKLESS GAS: Rinnai High Efficiency Natural Gas Tankless Heater
  6. BEST ENERGY-EFFICIENT: Rheem Performance Platinum Hybrid Electric Heater
  7. ALSO CONSIDER: A.O. Smith Signature Premier Natural Gas Heater
The Best Water Heaters Option

Photo: depositphotos.com

Types of Water Heaters

Shoppers have four hot water heater options to consider. These units range from old-school tank water heaters to the newer hybrid models. Each offers advantages to consider.

Storage Tank Water Heater

Storage tank-style water heaters are the most common type. They consist of an insulated tank with electric or natural gas power for heating. Gas units use a flame burner or electrically-powered heating elements or coils to warm the water to a temperature regulated by a thermostat. The water is kept at a preset temperature in the tank day and night, standing by until needed. Once the tank’s hot water supply runs out, family members must wait for the heater to reheat the tank, which can take up to an hour.

Tankless (On-Demand) Water Heater

Tankless hot water heaters work on an entirely different principle than the traditional storage tank water heater. Rather than continually heating water in a tank, tankless water heaters operate on demand. This means they don’t start heating water until someone needs it.

As with conventional hot water heaters, tankless water heaters use gas or electricity to heat water. When a hot water tap is opened, cold water enters the tankless heater via a pipe and then is heated quickly by a gas burner or electric coil. Unlike a tank water heater, a tankless water heater offers an endless supply of hot water.

Tankless hot water heaters do, however, have their limitations on speed and flow. Most can produce about 5 or 6 gallons of hot water per minute.

Heat Pump (Hybrid) Water Heater

Heat pump water heaters, also known as hybrid water heaters, work off the concept that it’s easier (and cheaper) to use existing heat than it is to create heat. Heat pump water heaters take the heat from the air and use it to warm water.

Like a refrigerator uses a compressor to expel hot air from its insulated interior, a heat pump water heater compresses the surrounding air, expelling the cool air and retaining the warm air to heat water. It’s called a hybrid because it uses electrical coils to heat the water when hot water consumption is high. Because it gathers heat from the air, a hybrid heat pump water heater works most efficiently in warm climates.

What to Consider When Choosing the Best Water Heater

While knowing the different types of hot water heaters and their advantages is important, it also helps to know the main factors or features to consider when determining the best hot water heater for your needs.

Gas vs. Electric

The big difference between electric and gas water heaters is cost. Expect to pay, on average, between $1,300 and $2,600, including installation fees, for a 40-gallon gas water heater versus $950 to $1,500 for the same-size electric water heater, as reported to Fixr, a network of contractors and home improvement professionals.

Although operating costs fluctuate with gas and electricity rates, gas is significantly cheaper than electric to run. Gas water heaters cost around $30 a month to operate while electric heaters will run about $42 a month, according to Fixr.

Venting Needs

Because electric water heaters don’t require vents, they can be installed in almost any location in the home. Gas hot water heaters produce carbon monoxide exhaust gases and moisture when they burn. They use a ventilation system that consists of pipes and ducts to remove these byproducts. Thus, gas heaters need venting and take up more space than electric water heaters, limiting their placement in a home.

Sizing and Capacity

Hot water heaters come in capacities ranging from 20 to 100 gallons. The larger the capacity, the more hot water you can use before the supply runs out and the waiting game for more hot water begins. A 40- to 50-gallon tank is sufficient to handle a household of 4 people. Add 10 gallons of capacity for each additional person.

The higher the capacity, the larger the hot water heater. It’s essential to determine how much space is available in a basement or utility closet when selecting a new hot water heater. Gas and electric hot water heaters come in tall models, which are 50 to 76 inches tall and 18 to 21 inches in diameter, and short models, which are between 30 and 49 inches tall and 20 to 26 inches in diameter. Also, note that gas hot water heaters take up more space because of the venting pipes and ducts they require.

If you’re tight on space, consider the much more compact tankless water heaters. Since tankless hot water heaters don’t have the water storage capacity of conventional tank heaters, they have their limitations. A typical tankless water heater provides hot water at a rate of 2 to 5 gallons per minute, which can limit the flow of hot water into the home, especially if multiple taps or appliances are using hot water at the same time.

Multiple tankless water heaters can work in tandem to improve the total hot water capacity a home needs. A separate tankless heater can serve specific appliances such as a washing machine.

Efficiency Rating

All water heaters have efficiency ratings, which indicate how much of the energy used by the unit actually heats water. A hot water heater with an efficiency rating of .70 means that 70 percent of the energy consumed by the water heater goes toward heating water.

This rating isn’t a great indication of how much you can expect to spend on the unit, given the difference in gas and electricity rates. For example, a gas unit will have a much lower efficiency rating than an electric water heater, but because gas is significantly cheaper, running a gas tank heater will cost considerably less than running an electric water heater.

Tankless water heaters cost significantly less than storage tank heaters because they aren’t always running to keep a water supply warm. Depending on a home’s hot water usage, a tankless system can save as much as 40 percent off an energy bill. It’s often better to look at the estimated annual cost of operating the hot water heater to determine how it will affect the budget.

Brass vs. Plastic Drain Valves

Tank water heaters have a valve at the bottom of the tank used to drain the tank for maintenance. These valves work with a standard garden hose and are made of brass or PVC (Polyvinyl chloride). Since brass is far more durable than plastic, the better choice is a hot water heater that uses a brass drain valve.

Digital Displays

Like other major utility systems in a home, newer water heaters come with digital controls that allow owners to program the water heater to shut off at different times, such as when the family is away on vacation. While a digital display might add to the unit’s initial cost, it improves the efficiency of the hot water heater, ultimately saving money.

Our Top Picks

Read on to review these recommendations for hot water heaters in several categories. This list includes some of the most efficient and technologically advanced units from reputable hot water heater manufacturers.

Best Overall

The Best Water Heaters Option: Rheem Performance Platinum 50 Gal Natural Gas Heater
Photo: amazon.com

From a respected name in water heaters comes the Rheem Performance Platinum 50 Gal. Tall Natural Gas Water Heater. This tank water heater offers excellent all-around performance and efficiency. Its 50-gallon capacity provides plenty of water for a family of five without breaking the bank.

With its powerful 40,000 BTU gas burner, the Performance Platinum can deliver a staggering 77 gallons of hot water in the first hour. Despite this high output, it’s rated to set owners back less than $300 a year, on average, in energy costs.

Product Specs

  • Type: Storage tank
  • Water Capacity: 50 gallons
  • BTUs/Power Output: 40,000 BTUs

Pros

  • 0.64 uniform energy rating
  • Provides 77 gallons of water in the first hour
  • Push-button ignition system
  • Suitable for homes of up to 8500 square feet

Cons

  • Some users have reported minor manufacturing defects

Get the Rheem natural gas water heater at The Home Depot.

Runner Up

The Best Water Heaters Option: A.O. Smith Signature 50-Gallon Natural Gas Heater
Photo: lowes.com

The A.O. Smith Signature features a 50-gallon tank heated by a powerful 40,000 BTU burner, enabling it to deliver up to 81 gallons of hot water in the first hour. This makes the water heater powerful enough to serve a household of three or four, and it’s also energy efficient.

Features include an electronic gas valve for precise thermostat control, an LED indicator that provides system information, and an integrated safety system that prevents accidental fires.

Product Specs

  • Type: Storage tank
  • Water Capacity: 50 gallons
  • BTUs/Power Output: 40,000 BTUs

Pros

  • Suitable for homes with 3-4 people
  • Provides 81 gallons of water in the first hour
  • 0.62 uniform energy rating
  • High-altitude certified

Cons

  • Not Energy Star certified

A.O. Smith natural gas heater at Lowe’s.

Best Budget

The Best Water Heaters Option: Rheem Performance 50 Gal. Electric Water Heater
Photo: homedepot.com

There’s a lot packed into Rheem’s Performance 50 Gal. 4,500 Watt Electric Hot Water Heater. One of the best Rheem water heaters available, this unit’s 50-gallon capacity can provide hot water for a household of four. This 6-year tank offers 61 gallons of water within the first hour.

Though this electric unit lacks the energy efficiency of a gas water heater, it includes some excellent features designed to improve efficiency and reliability. This unit comes with overheat protection with a temperature pressure relief valve to prevent the tank from reaching temperatures over 150 degrees Fahrenheit.

Product Specs

  • Type: Storage tank
  • Water Capacity: 50 gallons
  • BTUs/Power Output: 4,500 watts

Pros

  • Compact, easy-to-install size
  • Suitable for households of 4 people or less
  • Overheat protection with temperature pressure relief valve
  • Affordable price point

Cons

  • Requires 240-volt power supply
  • Not as energy efficient as similar models

Get the Rheem electric water heater at The Home Depot.

Best Tankless Electric

The Best Water Heaters Option: Stiebel Eltron Tankless Water Heater, Electric
Photo: amazon.com

Selected as the best of the electric tankless water heaters, users can say “never again” to cold showers with the Stiebel Eltron Tankless Tempra 24 Plus. In addition to supplying a steady flow of hot water, the Stiebel Eltron Tempra 24 Plus includes several features that make it rank among the top tankless water heaters. When hot water demand begins to exceed capacity, the Stiebel Eltron Tempra 24 Plus automatically makes slight reductions to flow to ensure the warm water keeps on coming.

Like most electric tankless water heaters, this unit will provide up to 5 gallons of hot water per minute and can save you money. The Tempra uses about 15 to 20 percent less energy than standard tank water heaters. Other attractive features include easy-to-use digital controls for output and water temperature. The unit is small, weighing in at just over 15 pounds, and takes up very little space with its 20- by 20-inch profile.

Product Specs

  • Type: Tankless
  • Water Capacity: 5 gallons per minute
  • BTUs/Power Output: 18,000 watts

Pros

  • Self-adjusting water flow
  • Requires less energy than similar options
  • Built-in digital control panel
  • Lightweight design

Cons

  • No installation kit or tools included
  • Expensive for a small model

Get the Stiebel Eltron tankless water heater on Amazon, The Home Depot, and Lowe’s.

Best Tankless Gas

Best Water Heater Option: Rinnai RU199iN Tankless Water Heater
Photo: amazon.com

The capabilities of the Rinnai RU199iN Tankless Water Heater are impressive, with an 11 GPM max flow rate that can produce hot water for up to seven different fixtures. The 199,000 BTU maximum is more than enough for a standard mixture of teens and adults in a single household to go through their morning routines without a drop in water temperature.

Despite it being a natural gas system, the unit’s efficiency rating sits comfortably between 93 and 96 percent and is Energy Star-certified. This is mostly due to the condensing feature that allows the water heater to remove as much heat from the exhaust as possible before releasing it through the ventilation.

Product Specs

  • Type: Tankless
  • Water Capacity: 11 gallons per minute
  • BTUs/Power Output: 200,000 BTUs

Pros

  • Produces water for up to 7 fixtures
  • Very energy efficient water heater; Energy Star-certified
  • Wall-mounted option
  • Wi-Fi ready

Cons

  • Pricey

Get the Rinnai water heater on Amazon or at Lowe’s.

Best Energy-Efficient

The Best Water Heaters Option: Rheem Performance Platinum Hybrid Electric Heater
Photo: amazon.com

Take energy efficiency to the next level with the Rheem Performance Platinum 50 Gal. 10-year Hybrid Electric Water Heater. This Energy Star-rated unit will save nearly $500 per year in energy costs compared to standard tank electric hot water heaters. Couple that with a 10-year warranty, and this unit offers exceptional savings.

Although the upfront cost is expensive, it will earn back that difference in just a couple of years. This hybrid produces enough water to serve households of up to five people. It’s also a smart water heater, so owners can track usage and manage the water heater’s operation via a smartphone. The Rheem hybrid water heater has an integrated self-cleaning function that reduces sediment, extending the life of the water heater.

Product Specs

  • Type: Hybrid
  • Water Capacity: 50 gallons
  • BTUs/Power Output: 4,500 watts

Pros

  • Suitable for homes with up to 5 people
  • Smartphone monitoring included
  • Self-cleaning function deters sediment buildup
  • Energy efficient

Cons

  • Heavyweight design
  • Expensive compared to similar options

Get the Rheem electric water heater at The Home Depot.

Also Consider

The Best Water Heaters Option: A.O. Smith 40-Gallon Short Natural Gas Water Heater
Photo: walmart.com

Families can keep the hot water flowing for years to come with the A.O. Smith Signature Premier 40-Gallon gas tank hot water heater that features plenty of water-heating power. It boasts a 40,000 BTU burner, which delivers 65 gallons of hot water in the first hour. That’s plenty to provide hot water for a household of 4 people.

Other features include intuitive electronic temperature controls and an LED system status indicator. This tank water heater will fit into more compact spaces than some, measuring just 50.5 inches tall and 20 inches in diameter. Durability is always an issue when it comes to hot water heaters. A.O. Smith equips this unit with features to extend its life, including a DynaClean diffuser system that reduces sediment and Blue Diamond tank lining that protects against leaks.

Product Specs

  • Type: Storage tank
  • Water Capacity: 40 gallons
  • BTUs/Power Output: 40,000 BTUs

Pros

  • Provides 65 gallons of water in the first hour
  • Suitable for homes with 4 people or less
  • Built-in LED system indicator
  • Durable construction; DynaClean diffuser and Blue Diamond tank lining

Cons

  • Expensive compared to similar models

Get the A.O. Smith water heater at Lowe’s.

Our Verdict

Selecting a water heater that can accommodate the number of people in your household while not taking up too much energy can be difficult. One of the best options overall is the Rheem Performance Platinum. Designed to be a storage tank, this option holds up to 50 gallons of hot water with a 40,000 BTU output. Plus, this pick comes with an easy push-button ignition, can provide 77 gallons of water in the first hour, and comes with a 0.64 uniform energy rating.

Alternatively, if a tankless option is more suitable for your needs, the Stiebel Eltron holds 40 gallons of hot water with the same 40,000 BTU output as the Rheem pick. But, this pick may be easier to install as it has a compact size and has a self-adjusting water flow and digital control panel for added efficiency.

How We Chose the Best Water Heaters 

The right water heater can make bubble baths, showers, and common kitchen and bathroom tasks easier and more frequent without using ample energy. Selections for the best water heaters depended upon the water capacity, power output, ease of installation, type, and added special features included by some brands.

The featured list prioritizes variety by listing storage tank, tankless, and hybrid options for your needs. Each type provides either small or large hot water tanks, averaging at 40 to 50 gallons for households of 3-5 people. As for power output, most of these water heaters are energy efficient by offering a uniform energy factor of under 0.70. Though water-saving, all of these units have powerful BTUs or wattages to heat ample amounts of water quickly. The storage tank options average at 40,000 BTUs, while the tankless and hybrid options run at 4,500 watts.

As for durability, self-cleaning and diffuser systems remove sediment buildup and tank liners to reduce the likelihood of leaks. Since water heaters typically come in large sizes, installation of some of these models may require professional help. But, some of the smaller units that are lightweight and compact may be easy to install without help.

FAQs 

An old hot water heater is like a ticking time bomb. It sits for many years in your basement or utility closet, dutifully providing your family with hot water until, without warning, it stops working, creating an unexpected inconvenience and expense. Although a broken water heater might feel as shocking as an ice-cold shower, there are a few warning signs to watch for.

Q: How long does a hot water heater last?

On average, a gas, an electric, or a hybrid tank hot water heater will last between eight and 12 years. Tankless water heaters can last as many as 20 years.

Q: What are the signs your hot water heater is going out?

There are telltale signs of a failing water heater, including banging noises inside the tank, a decline in water temperature, rust-colored water, and water pooling around the tank’s base.

Q: Can you still shower if your water heater is leaking?

A leaking water heater will not prevent you from taking a warm shower. If the leak is bad enough that you need to shut off the water heater, you can still shower. You just won’t have any hot water.

Q: Can a leaking water heater explode?

Though a rare occurrence, a water heater can indeed explode and in spectacular fashion. This occurs with gas or electric water heaters that have clogged or malfunctioning pressure relief valves. If too much pressure builds, the water heater will explode, literally launching the unit like a rocket.

Q: How much does it cost to replace a hot water heater?

A water heater installation costs between about $804 and $1,547, which includes the price of the water heater plus labor, according to HomeAdvisor, a network of contractors and home improvement professionals. Tankless heaters, which are significantly more expensive than tank heaters, are on the high end of this range and may be expensive to replace.