When comparing the two there is one word that comes to mind, efficiency. An electric water heater is plugged into the wall and runs off of electricity. The unit’s heat sources are two black square plates with two wires attached to each plate. The wires heat up the plates using electricity. The plates are located at the bottom and top of the tank. Whereas, a gas heater has a burner at the bottom of the tank, allowing it to heat up a 40 to 50 gallon unit at a much faster rate.