What is the annual operating cost of a heat pump water heater?

At 55 gallons a day and a 70 F rise, a heat pump water heater with a UEF near 3.5 costs roughly $118 to $294 a year in electricity across a $0.12 to $0.30 per kWh price range. The exact figure scales directly with actual daily usage and the local electricity rate, so a household using more or less than 55 gallons a day will see a proportionally different bill.

How much more does an electric resistance tank cost to run than a heat pump water heater?

At the same usage, rise and electricity price, an electric resistance tank costs roughly three and a half to four times more to run than a heat pump water heater, matching the ratio of their typical UEF figures, about 0.92 versus about 3.5. At $0.16 per kWh and 55 gallons a day, that works out to about $597 a year for resistance versus about $157 a year for a heat pump.

How is water heater operating cost calculated?

Delivered BTU per day equals gallons used times 8.33 times the temperature rise, input BTU equals that figure divided by the unit's UEF, and that input BTU is converted into kilowatt-hours, therms or gallons of propane and multiplied by price and by 365 days in a year. The operating cost calculator on this site runs this formula for a specific household's own usage and local fuel price.

Does daily usage or fuel price matter more for the water heater bill?

In the tables on this page, moving daily usage from 25 to 80 gallons roughly triples the annual bill, while moving electricity price across a realistic $0.12 to $0.30 per kWh range only about two and a half times the bill at fixed usage. Daily usage, which depends on household size and habits, is generally the larger lever than local fuel price for most households.

Why does the same water heater cost more in one house than another?

Three things move the bill for an identical model: gallons of hot water used per day, the temperature rise from incoming water to the setpoint, and the local price of the fuel. A larger household drawing more gallons, a colder incoming water supply demanding a bigger rise, or simply a higher utility rate can each independently raise the bill without any difference in the water heater itself.

Does a higher UEF always lower the operating cost proportionally?

For a fixed fuel, yes, since input energy needed is delivered energy divided by UEF, so cost scales inversely with UEF at a fixed usage, rise and price. Comparing across fuels also requires accounting for each fuel's price per unit of energy, which is why the UEF comparison chart and this operating cost chart are meant to be read together rather than UEF alone.

Operating Cost

Water Heater Operating Cost Chart

Researched from the DOE test procedures, NFPA 54 and NEC code tables, and manufacturer specifications. Updated 2026-09-17.

Quick answer

Running 55 gallons a day through a 70 F rise, a heat pump water heater costs roughly $118 to $294 a year in electricity across a $0.12 to $0.30 per kWh range, while an electric resistance tank under the same use costs about $448 to $1,119. That efficiency gap is exactly what a UEF near 3.5 versus a UEF near 0.92 predicts. These figures use a fixed 55 gallon daily draw as a convention, since daily usage varies far more between households than fuel prices do.

Annual operating cost follows directly from four numbers: how much hot water is drawn each day, how far it has to rise in temperature, how efficiently the water heater converts input energy into delivered heat, and what that input energy costs per unit. The method here is delivered BTU per day equals gallons times 8.33 times the temperature rise, then input BTU equals that delivered figure divided by the water heater's UEF, then that input BTU is converted to kilowatt-hours, therms or gallons of propane and multiplied by a price and by 365 days.

This page holds daily usage at 55 gallons, the DOE medium draw pattern used on the UEF comparison chart, and holds the rise at 70 F, both as a convention rather than a measurement of any one household. The operating cost calculator and payback calculator run this same method for a household's own usage and local price.

What formula does this chart use to estimate annual operating cost?

Delivered BTU per day equals gallons used times 8.33 pounds per gallon times the temperature rise in Fahrenheit degrees, the same Q = m x c x dT relation behind every calculator on this site. Input BTU per day equals that delivered figure divided by the water heater's UEF, since UEF is defined as delivered energy over consumed energy. That daily input BTU is then converted into whatever unit a fuel is billed in, kilowatt-hours at 3,412 BTU each, therms at 100,000 BTU each, or gallons of propane at about 91,500 BTU each, multiplied by a price per unit and by 365 days in a year.

What does an electric water heater cost to run across a range of electricity prices?

Held at 55 gallons a day and a 70 F rise, a convention chosen to match the DOE medium draw pattern.

Estimated annual electric operating cost, 55 gallons a day at a 70 F rise
Water heater type	$0.12/kWh	$0.16/kWh	$0.22/kWh	$0.30/kWh
Electric resistance tank (UEF 0.92)	$448	$597	$820	$1,119
Heat pump water heater (UEF 3.5)	$118	$157	$216	$294

Convention Source: Calculated as (55 gal x 8.33 x 70 F rise x 365) / UEF, converted at 3,412 BTU per kWh, then multiplied by each listed price. 55 gallons a day and a 70 F rise are held as conventions; UEF figures come from the UEF comparison chart on this site.. A real household's daily usage and incoming water temperature both move this figure; use the operating cost calculator for a personalized estimate.

What does a gas water heater cost to run across a range of natural gas prices?

Estimated annual natural gas operating cost, 55 gallons a day at a 70 F rise
Water heater type	$0.80/therm	$1.20/therm	$1.60/therm	$2.20/therm
Atmospheric gas tank (UEF 0.60)	$156	$234	$312	$429
Non-condensing gas tankless (UEF 0.81)	$116	$173	$231	$318

Convention Source: Calculated as (55 gal x 8.33 x 70 F rise x 365) / UEF, converted at 100,000 BTU per therm, then multiplied by each listed price. 55 gallons a day and a 70 F rise are held as conventions.. A condensing gas tank or condensing gas tankless unit, at UEF 0.80 and 0.93 respectively, would land between and below these two rows.

What does a propane water heater cost to run?

Estimated annual propane operating cost, 55 gallons a day at a 70 F rise
Water heater type	$2.00/gal	$2.60/gal	$3.20/gal	$4.00/gal
Propane tank (UEF 0.60)	$426	$554	$682	$853

Convention Source: Calculated as (55 gal x 8.33 x 70 F rise x 365) / 0.60 UEF, converted at 91,500 BTU per gallon of propane, then multiplied by each listed price. 55 gallons a day and a 70 F rise are held as conventions.. Propane and atmospheric natural gas tanks share a similar typical UEF, so the dollar gap between them here comes almost entirely from propane's higher price per unit of delivered energy.

How much does daily usage change the answer, compared with fuel price?

Daily usage is the input that varies most between households, more than local fuel price does. Holding price fixed and varying only daily usage shows how much that single number moves the bill.

Annual cost by daily usage, at a 70 F rise and a fixed representative price
Daily usage	Electric resistance tank ($0.16/kWh)	Heat pump water heater ($0.16/kWh)	Atmospheric gas tank ($1.20/therm)
25 gal/day	$271	$71	$106
40 gal/day	$434	$114	$170
55 gal/day	$597	$157	$234
80 gal/day	$868	$228	$341

Convention Source: Calculated with the same method as the tables above, holding UEF, rise and price fixed for each column while varying only daily gallons used from 25 to 80.. Moving from 25 to 80 gallons a day roughly triples the annual bill in every column here, a bigger swing than the full price range in the tables above produces at a fixed usage.

Why do two households with the same water heater see different bills?

The formula behind every table on this page has exactly three moving parts once a specific model is chosen: gallons used per day, temperature rise, and fuel price. Two identical tanks in two different houses can post very different bills because one household showers more people through more gallons, or because one house draws from a cold winter well while the other draws from a warmer municipal supply with a smaller rise, or simply because local utility rates differ. UEF stays fixed once a model is chosen, so usage and rise are usually the larger levers a household actually controls.

Units representing the cost tiers below

These correspond to the categories worked out in the tables below.

Heat pump

Senville

Senville Hybrid Heat Pump 50 Gallon

$1,099.99

Lowest annual operating cost of any category in this chart, the result of its UEF near 3.5.

Best for: A first heat pump water heater in a warm garage or basement

Check price on Amazon

Electric resistance tank

Rheem

Rheem PROE50 M2 50 Gallon

$945.99

The electric resistance baseline used throughout the tables below, at a UEF near 0.92.

Best for: A straight 50 gallon electric replacement

Check price on Amazon

Gas tank

GE RealMAX Choice 40 Gallon Natural Gas

$1,051.49

Representative of the atmospheric gas tank figures in the natural gas cost table.

Best for: A like-for-like swap into an existing masonry or B-vent flue

Check price on Amazon

Controller

Aquanta

Aquanta WiFi Water Heater Controller

$189.00

Adds scheduling to an existing electric tank, useful for shifting draws toward off-peak electricity pricing without changing the tank itself.

Best for: Measuring before spending on a new heater

Check price on Amazon

Frequently asked questions

What is the annual operating cost of a heat pump water heater?: At 55 gallons a day and a 70 F rise, a heat pump water heater with a UEF near 3.5 costs roughly $118 to $294 a year in electricity across a $0.12 to $0.30 per kWh price range. The exact figure scales directly with actual daily usage and the local electricity rate, so a household using more or less than 55 gallons a day will see a proportionally different bill.
How much more does an electric resistance tank cost to run than a heat pump water heater?: At the same usage, rise and electricity price, an electric resistance tank costs roughly three and a half to four times more to run than a heat pump water heater, matching the ratio of their typical UEF figures, about 0.92 versus about 3.5. At $0.16 per kWh and 55 gallons a day, that works out to about $597 a year for resistance versus about $157 a year for a heat pump.
How is water heater operating cost calculated?: Delivered BTU per day equals gallons used times 8.33 times the temperature rise, input BTU equals that figure divided by the unit's UEF, and that input BTU is converted into kilowatt-hours, therms or gallons of propane and multiplied by price and by 365 days in a year. The operating cost calculator on this site runs this formula for a specific household's own usage and local fuel price.
Does daily usage or fuel price matter more for the water heater bill?: In the tables on this page, moving daily usage from 25 to 80 gallons roughly triples the annual bill, while moving electricity price across a realistic $0.12 to $0.30 per kWh range only about two and a half times the bill at fixed usage. Daily usage, which depends on household size and habits, is generally the larger lever than local fuel price for most households.
Why does the same water heater cost more in one house than another?: Three things move the bill for an identical model: gallons of hot water used per day, the temperature rise from incoming water to the setpoint, and the local price of the fuel. A larger household drawing more gallons, a colder incoming water supply demanding a bigger rise, or simply a higher utility rate can each independently raise the bill without any difference in the water heater itself.
Does a higher UEF always lower the operating cost proportionally?: For a fixed fuel, yes, since input energy needed is delivered energy divided by UEF, so cost scales inversely with UEF at a fixed usage, rise and price. Comparing across fuels also requires accounting for each fuel's price per unit of energy, which is why the UEF comparison chart and this operating cost chart are meant to be read together rather than UEF alone.

These figures hold usage and rise fixed on purpose, so they are a planning comparison, not a bill prediction. A household's actual gallons per day and its actual incoming water temperature both move the real number meaningfully, so use the operating cost calculator with real inputs before treating any figure here as a specific forecast.