40-Gallon vs. 50-Gallon Water Heater Guide

By Anita Wong

October 19, 2026

Choosing between a 40-gallon and a 50-gallon water heater seems simple at first. More hot water is better, right? But whether you can benefit from another 10 gallons depends on your hot water usage and how well your water heater keeps the hot water flowing.

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What Size Water Heater Do You Need?

A 40-gallon water heater generally delivers enough hot water for two or three people, while a 50-gallon unit may be better suited for three or four people. However, you need to factor in more than the number of people or bathrooms in your home when shopping for a water heater replacement.

Hot Water Needs

Consider how often you run baths, showers, dishwashers and washing machines simultaneously, as this can deplete your stored hot water. Smaller households may need a larger-capacity water heater if usage is high during peak periods. A larger household may manage with a smaller-capacity tank if hot water use is spread throughout the day.

First-Hour Rating

Look at the water heater's first-hour rating (FHR). FHR indicates how many gallons of hot water you can expect in 1 hour, starting with a fully heated tank. It accounts for the stored hot water plus the unit's ability to replenish the supply as it's used. For example, Rheem makes a 40-gallon gas water heater with an FHR of 68 gallons and a 50-gallon model that can deliver 85 gallons of hot water in the first hour.

The U.S. Department of Energy suggests estimating how many gallons of hot water you use during your home's busiest hour and selecting a model with an FHR within about 2 gallons of this amount.

Fuel Type and Recovery Rate

The type of fuel a water heater uses can also impact how fast the unit heats water. A 40- to 50-gallon gas water heater usually recovers in 30 to 40 minutes, while an electric model with the same capacity may take 60 to 90 minutes, according to A. O. Smith.

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40-Gallon vs. 50-Gallon Water Heater Dimensions

Water heaters come in short, tall and compact models to fit different spaces. A 50-gallon water heater is often taller or wider than its 40-gallon counterpart, but dimensions depend on the model.

For example, the 40-gallon A. O. Smith ProLine gas water heater measures 58.25 inches tall and 18 inches in diameter. The 50-gallon unit in the same line is shorter at 57 inches tall, but wider at 21 inches in diameter. Be sure to check a product's specifications to ensure it fits the installation space.

Water Heater Replacement Costs

In general, gas water heaters cost more to purchase and install than electric water heaters. Installation costs vary by provider and may include additional charges for venting, updating electrical and gas connections and disposing of old appliances.

Here are the average costs of buying and installing a 40-gallon vs. 50-gallon water heater, according to HomeGuide:

Electric: A 40-gallon electric water heater costs approximately $600 to $1,600 (CAD $856 to CAD $2,282) to buy and install, while a 50-gallon electric unit is about $700 to $1,800 (CAD $999 to CAD $2,568).
Gas: A 40-gallon gas water heater costs about $900 to $3,000+ (CAD $1,283 to CAD $4,279+) to buy and install, and a 50-gallon gas unit is about $1,000 to $3,100+ (CAD $1,426 to CAD $4,422+).

The operating cost of a 40-gallon vs. 50-gallon water heater depends on its energy-efficiency rating and your hot water usage, not just tank capacity. A professional plumber can help you decide which size water heater best meets your home's peak-hour hot water demands while helping keep energy costs in check.

All CAD conversions are based on the exchange rate on the date of publication.

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