Water heater quotes vary widely for what looks like the same job, and the variation is scope.
A like-for-like replacement
The heater.
Labour: drain, disconnect, remove, set, reconnect, fill, purge, test.
Fittings and connectors — flexible water connectors, a gas connector or an electrical whip, unions, and dielectric fittings where copper meets steel.
Disposal of the old unit.
A permit in most jurisdictions.
That is the base job, and it is usually a morning.
The code upgrades that come with it
These are what surprise people, because the old heater did not have them and the new one is required to.
An expansion tank, where the system is closed — which is most houses with a pressure reducing valve or a backflow preventer.
A thermostatic mixing valve, required in some jurisdictions.
A drain pan and drain line, where a leak would do damage.
Seismic strapping, in seismic regions.
Updated venting, where the existing flue does not meet current requirements.
A shutoff valve on the cold inlet, where one is missing.
Each is small. Together they are a meaningful line on the invoice and they are legitimately required.
Where the job stops being a swap
Changing fuel. Gas to electric needs a circuit and a panel position; electric to gas needs a gas line, venting and combustion air.
Changing to a heat pump unit, which needs a condensate drain, adequate air volume or ducting, and possibly a larger tank footprint.
Changing to tankless, which needs a larger gas line, new venting, a condensate drain and an electrical supply.
Moving the location, which means new water lines, new venting and a new supply.
A different size, where the new tank does not fit the existing space or connections.
Any of these is a project rather than a replacement, and the quote should say which.
Emergency versus planned
A leaking tank is replaced the same day with whatever is available, at whatever the call-out rate is, with no time to consider a heat pump unit or to claim an incentive.
A planned replacement gets the right size from a first hour rating calculation, the efficient option if the space suits it, the incentives claimed, and a pan and shutoff fitted while the space is open.
For a heater past ten years — particularly one in an attic or over a finished space — that difference is the argument for not waiting.
What to check on a quote
Whether the permit is included. Whether an expansion tank is included and whether the system is in fact closed. Whether disposal is included. What the warranty is on the unit and on the labour. And whether the model quoted qualifies for any available incentive.
Where to spend a little more
A better warranty tier, which usually means a heavier anode and therefore a longer life.
A full-port brass drain valve, which makes annual flushing easy.
A pan with a leak sensor and automatic shutoff, anywhere a leak would reach a finished space.
Pipe insulation on the first several feet of hot and cold pipe at the heater.
All four are small sums against the appliance, and each of them returns more than the difference between two efficiency tiers on a tank that is otherwise identical.
Doing it yourself
A like-for-like electric replacement is within reach of a competent homeowner in most jurisdictions, with a permit.
A gas replacement involves the gas connection and the venting, both of which have consequences if done wrong, and many jurisdictions require a licensed installer for the gas work.
Either way the permit and inspection are the check that matters, and the inspector is an experienced person looking at the work for a small fee.
The warranty registration
Manufacturers commonly extend the warranty when the unit is registered within a window after installation, and it is usually the installer's task.
It costs nothing, it is frequently forgotten, and on a tank the warranty tier generally corresponds to the anode and therefore to the expected life. Confirming it was submitted takes one email.