Electric Water Heater Market By Product Type (Storage Water Heaters, Tankless Water Heaters, Hybrid Water Heaters), By Capacity (Below 30 Liters, 30–100 Liters, 100–250 Liters, Above 250 Liters), By Application (Residential, Commercial, Industrial), By Distribution Channel (Online, Offline), Global Market Size, Segmental Analysis, Regional Overview, Company Share Analysis, Leading Company Profiles and Market Forecast, 2025 – 2035

---

Industry Outlook

The Electric Water Heater market accounted for USD 16.2 Billion in 2024 and is expected to reach USD 40.15 Billion by 2035, growing at a CAGR of around 8.6% between 2025 and 2035. The electric water heaters market continues to grow because people increasingly need powerful yet efficient water heating solutions. Due to their simple installation methods and affordable maintenance costs, electric water heaters are being selected at higher rates in households and industrial facilities alongside commercial buildings. The electric water heaters market experiences growth because customers choose sustainable living approaches along with eco-friendly household devices.

The market's development receives support from advances in Application that have produced smart water heaters with Wi-Fi capabilities. Electric water heaters experience rising demand because countries have become more urbanized, and residents obtain higher disposable incomes. The utilization of electric water heaters depends on both local electricity expenses as well as power availability in the area.

Report Scope:

Market Dynamics

Rising urbanization and nuclear family trends are increasing demand for compact water heating solutions.

The Electric Water Heater Market experiences increased demand because of fast-paced urbanization, together with the growing trend of nuclear family formation. The rise of independent living, together with small family households, especially within urban space, requires effective space-saving appliances suitable for apartments and studio flat dwellings. The demand for efficient space utilization through fast installation and daily usage needs is fulfilled by compact electric water heaters.

The United Nations Department of Economic and Social Affairs (UN DESA) reports that 55% of the worldwide population dwelt in urban areas during 2020. The higher adoption of appliances suitable for urban dwellings is positively influenced by these market trends. The Electric Water Heater Market finds advantages through the population trend because city developments focus on building convenient home systems that operate quickly and with efficiency.

Government incentives for energy-efficient appliances promote electric heater adoption.

The Electric Water Heater Market receives substantial growth from government programs that support energy-efficient commercial appliances. Worldwide governments actively support energy-efficient technology adoption because it minimizes energy usage, together with carbon emissions. The combination of tax rebates with subsidies and energy efficiency certifications makes consumers select electric water heaters that meet elevated energy standards.

Consumers who buy Energy Star-certified energy-efficient products can receive tax benefits from the U.S. Environmental Protection Agency (EPA) through its certification program that operates in the United States. U.S. Department of Energy states that Energy Star-certified electric water heaters reduce energy consumption by 10-50% compared to standard models on the market. The electric water heater market grows due to rising consumer selectivity for these appliances, which save consumers money over time while protecting the environment.

High electricity tariffs in some regions discourage electric heater usage.

The Electric Water Heater Market faces substantial challenges from high electricity pricing throughout certain parts of its industry territory. High electricity costs within specific regions discourage people from adopting electric water heaters because the pricing of electrical operation becomes a barrier. Electric water heaters need a constant electric power supply, which causes residents in areas with high power rates to face significant monthly utility expenses.

Electrical consumers choose alternative water heater solutions, such as gas and solar options, since these options provide more lasting cost benefits. Unreliable power supply combined with electricity outages makes electric water heaters less attractive for consumers in affected areas. The market expansion is hindered by decreasing interest in electric water heaters because these factors limit adoption in certain areas.

Development of energy-efficient, low-consumption models for emerging markets.

The Electric Water Heater Market finds substantial growth possibilities through developing energy-saving, low-consumption heating devices, particularly in developing markets. Rising urbanization, together with increasing demand for inexpensive household appliances, can be found in various parts of Asia, along with Africa and Latin America. The market demands energy-efficient storage heaters that combine optimized efficiency with minimal energy consumption because consumers face limited access to steady power supplies while paying attention to cost reduction.

The market environment enables producers to develop advanced product models with low operational power demands while preserving original specifications. These heaters satisfy both government energy efficiency programs and serve eco-conscious users looking to meet their demands. The increasing infrastructure development alongside enhanced purchasing capabilities make energy-efficient electric water heaters highly receptive to industrial demands across developing geographic areas.

Growth in modular construction and prefab housing is increasing bulk purchases.

 The Electric Water Heater Market stands to gain a significant business opportunity from the expanding modular construction and prefabricated housing sector through bulk purchase agreements. Building principles of contemporary architecture focus on speed and efficiency, together with cost reduction, thus becoming standard for homes and emergency residences, and commercial spaces, including hostels and worker camps.

The pre-assembly stage of prefab units utilizes electric water heaters mainly through compact and energy-efficient devices. Builders and developers consider these products as their preferred pick because they feature quick setup and minimal upkeep requirements, together with scalability across different space configurations. The global need for cost-effective housing, which continues to rise in urban areas and disaster-stricken zones, leads to a heightened demand for pre-installed heating systems.

Industry Experts Opinion

“Always choose a water heater depending on the family size. A family of 3 usually requires a water heater with 25 litres of capacity, while one with more members might need a bigger capacity. In a smaller family of 1-2 members, a 15-liter capacity water heater would be more than enough.”

• Vikram Raman, Marketing Head, Ariston Group India Pvt. Ltd. ​

Segment Analysis

Based on the product type, the Electric Water Heater Market has been classified into Storage Water Heaters, Tankless Water Heaters, and Hybrid Water Heaters. The electric water heater market mostly relies on storage water heaters since they represent the principal product segment. Their broad consumer base stems from inexpensive cost and dependable design, which enables them to provide hot water to multiple outlets at once, suitable for individual houses and small commercial buildings.

The installation and upkeep of these units, along with their straightforward processes, make storage water heaters popular in areas with stable power grids. Storage units are selected by consumers because they maintain big hot water reserves, which makes them operate effectively when demand peaks. Storage heaters remain the preferred heating option in developing economies whose infrastructure development for instant heating solutions has not fully caught up.

Based on the Capacity, the Electric Water Heater Market has been classified into below 30 Liters, 30–100 Liters, 100–250 Liters, and above 250 Liters. The 30–100 liters capacity electric water heater segment leads all market segments within electric water heaters. Medium-sized residential and small commercial requirements find the best solutions from this capacity zone because it offers enough storage while optimizing space usage. This unit provides enough hot water for all daily bathing needs, together with washing duties and kitchen requirements at an optimal energy level.

This capacity range has gained popularity from the increasing popularity of nuclear families together with urban apartments. It provides adequate hot water storage at a level that meets energy efficiency requirements though it avoids any substantial temperature loss. Manufacturers sell multiple models with advanced smart controls and rapid heating technology which they introduce specifically for this segment.

Regional Analysis

The North American electric water heater market operates as a strong segment due to increasing residential and commercial construction activities throughout the U.S. and Canadian territories. The rising market adopts energy-efficient appliances combined with sustainable energy promotion through government policies. The market keeps growing because new technology both introduces smart water heaters and creates energy-saving technologies.

The United States maintains the highest market position among its regional competitors because the urban and suburban sectors show extensive demand. Emissions reduction energy policies strengthen the preference for electric water heaters instead of standard gas-based heating systems in the market.

The Asia Pacific electric water heaters market expands rapidly as more people become urbanized and their incomes rise, while they purchase contemporary home appliances. Thousands of electric water heaters are manufactured in China, along with India and South Korea, and Japan and China produce the most heaters because of their massive population and expanding real estate market. The tropical and temperate climates throughout the region drive the necessity for water heating systems throughout different seasons.

The market receives additional growth support from government programs that enhance the adoption of energy-efficient devices as well as areas expansion of electric power infrastructure. The growing understanding of hygiene, combined with hot water usage, is driving Indian and Southeast Asian consumers to adopt water heating systems. Higher demand for water heaters emerges in commercial settings, between hotels, hospitals, and educational facilities.

 Competitive Landscape

Competing entities in the electric water heaters market consist of international corporations, together with local businesses, which differentiate themselves through product development as well as energy efficiency accomplishments, and pricing elements. The electric water heaters market features strategic crucial entities which include A. O. Smith Corporation, Rheem Manufacturing Company, Ariston Holding N.V., Bradford White Corporation, Haier Group Corporation, Whirlpool Corporation, Bosch Terotechnology, and Electrolux AB.

The companies are developing innovative features for their products, which include smart connectivity and digital temperature controls as well as eco-friendly insulation layers. The growth of tankless and compact models has motivated research and development spending, which leads to product variety. The factors affecting consumer preference include brand reputation, together with warranty offerings, as well as after-sales service quality. New local market players Bajaj Electricals Ltd., Venus Home Appliances Pvt. Ltd., and Havells India Ltd. use e-commerce distribution to deliver their products to more customers with price competition.

Electric Water Heater Market, Company Shares Analysis, 2024

To explore in-depth analysis in this report - Request Free Sample Report

Recent Developments:

• In March 2024, Bosch Home Comfort introduced the GreenTronic 7000 T, a new hybrid electric water heater that utilizes heat pump technology for efficient water heating, potentially lowering energy costs. Available in 50 and 80-gallon models, the GreenTronic 7000 T qualifies for a federal tax credit, making it an appealing choice for homeowners seeking a sustainable hot water solution.
• In March 2023, A.O. Smith Corporation announced the acquisition of Reliance Water Heaters, a prominent manufacturer of electric water heaters in the Gulf Cooperation Council region.

 

Report Coverage:

By Product Type

• Storage Water Heaters
• Tankless Water Heaters
• Hybrid Water Heaters

By Capacity

• Below 30 Liters
• 30–100 Liters
• 100–250 Liters
• Above 250 Liters

By Application

• Residential
• Commercial
• Industrial

By Distribution Channel

• Online
• Offline

By Region

North America

• U.S.
• Canada

Europe

• U.K.
• France
• Germany
• Italy
• Spain
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• Australia
• South Korea
• Singapore
• Rest of Asia Pacific

Latin America

• Brazil
• Argentina
• Mexico
• Rest of Latin America

Middle East & Africa

• GCC Countries
• South Africa
• Rest of Middle East & Africa

List of Companies:

• A. O. Smith Corporation
• Rheem Manufacturing Company
• Ariston Holding N.V.
• Bradford White Corporation
• Haier Group Corporation
• Whirlpool Corporation
• Bosch Thermotechnology
• Electrolux AB
• Rinnai Corporation
• Stiebel Eltron GmbH & Co. KG
• Havells India Ltd.
• Kenmore
• Venus Home Appliances Pvt. Ltd.
• Bajaj Electricals Ltd.
• Eemax Inc.

Frequently Asked Questions (FAQs)