Water Heater Rentals in Ontario: Rent, Buy Out or Replace?

Ontario has an unusually strong water heater rental market. Many homes, particularly those that have been on natural gas for decades, still have a rented tank, often from companies such as Enercare or Reliance, with the charge appearing on the Enbridge Gas bill or billed separately. Many homeowners do not know whether their water heater is rented, how much they pay, or what it would cost to leave.

This guide explains how rentals work, how to compare renting with owning, and what to watch for in contracts.

Is your water heater rented?

Check these places:

• Your gas bill: look for a rental line item or third-party charge.
• The tank itself: rental units usually have a company sticker and a serial number.
• Home purchase documents: rental agreements are often assumed by buyers when a house is sold.
• Bank or card statements: some rental providers bill directly.

If you cannot find the contract, contact the provider shown on the tank and ask for a copy of your agreement, the current monthly rate and the buyout schedule.

How rental costs add up

Rental rates vary by provider, equipment type and contract age, and many contracts include annual increases. As a rough illustration only, monthly rental charges in Ontario commonly fall somewhere in the range of $25–$60 for tank units, with tankless and power-vented units at the higher end. Confirm your own rate on your bill.

Scenario (illustrative)	Over 10 years	Over 15 years
Renting at $30/month, rising 3% a year	~$4,100	~$6,700
Renting at $45/month, rising 3% a year	~$6,200	~$10,000
Buying a gas power-vented tank (~$2,500–$3,800 installed) plus occasional repairs	~$2,800–$4,500	Likely one replacement needed within this period

These are simplified estimates that ignore inflation and the value of the included service. The point is not that renting is always wrong, but that it is rarely the cheaper option over a long period.

What rentals include

Rental agreements usually include:

• Repairs and parts for the rented equipment.
• Replacement if the unit fails (often with conditions).
• Sometimes annual maintenance or a service call allowance.

Owning means you are responsible for repairs, but modern tanks often run for 10–13 years with limited maintenance, and many come with manufacturer warranties of six to 12 years on the tank. Some homeowners buy a separate protection plan; compare its cost carefully.

Getting out of a rental: buyout vs return

You have two broad choices when ending a rental.

Option	What it involves	Typical considerations
Buy out the existing unit	Pay the provider the buyout price shown in your contract's schedule	Makes sense if the unit is relatively new and working well
Return and replace	Buy a new water heater from any contractor; return the old unit to the rental company	Expect a removal or return fee in many contracts; you may need to arrange and pay for return
Continue renting	Keep the arrangement	Reasonable if you prefer bundled service and cannot pay upfront

Before you act:

1. Ask the provider in writing for the buyout amount, any removal fee and the notice they require.
2. Compare the buyout price with a new installed unit; an older rented tank near the end of its life is rarely worth buying out.
3. If replacing, choose the type carefully. See our water heater options guide.
4. Keep records of the return: date, who collected the unit and any reference number.

Caution: If you switch providers, make sure the old provider has actually closed your account. Double billing after a switch is a common complaint.

Your consumer protection rights

Ontario has strengthened protections in this market. The points below are a general summary, not legal advice; verify the current rules on ontario.ca.

• Door-to-door ban: Since 1 March 2018, Ontario's Consumer Protection Act bans unsolicited door-to-door contracts for water heaters, furnaces, air conditioners, water treatment devices, duct cleaning and certain other products. A business can only enter such a contract in your home if you initiated contact for that purpose.
• Cooling-off period: Direct agreements (made in your home) generally come with a 10-day cooling-off period during which you can cancel.
• Notices of Security Interest (NOSIs): Some rental and financing companies registered NOSIs on the land title of homes with rented equipment, which surprised homeowners when selling or refinancing. Legislation passed in 2023–24 (the Strengthening Protections for Ontario Consumers Act) moved to ban NOSIs on consumer goods, with protections taking effect in phases. If you find a NOSI on your title, check ontario.ca for current guidance on having it removed.

If someone arrives at your door claiming to be from your utility or "the government" and wants to inspect or replace your water heater, do not let them in. Read our door-to-door energy scams guide.

When renting can make sense

Renting is not always a bad deal. It may suit you if:

• You cannot cover a $2,000–$4,000 replacement cost right now.
• You value predictable monthly costs and do not want to manage repairs.
• You plan to sell soon and the buyer is happy to assume the rental.
• You have a specialized unit where service availability matters to you.

If you do rent, read the contract carefully, know the annual rate increase, and understand the buyout and termination terms.

Checklist: reviewing your rental

• Find and read your current agreement.
• Note the monthly rate and how it has changed.
• Note the installation date and expected life of the unit.
• Ask for the buyout price and removal fee in writing.
• Get two or three quotes for a purchased replacement.
• Compare total cost over 10 years, not monthly cost alone.
• Check your property title for any registered notice if you are selling or refinancing.

Frequently asked questions

Do I have to rent from the company that already supplies my tank?

No. You can buy a water heater from any qualified contractor. You will need to follow your current contract's terms for ending the rental, which may include a fee.

Can I take over the rental when I buy a house?

Most sales assume existing rentals unless the agreement of purchase and sale says otherwise. Ask your lawyer or real estate agent to identify rental equipment before closing.

Is a rent-to-own water heater better than a straight rental?

Rent-to-own or financing plans lead to ownership, but the total paid can still exceed buying outright. Compare the total of all payments with a cash purchase price.

Who do I call if I think a rental contract was unfair?

Start with the company in writing. If unresolved, Ontario's consumer protection office can be reached through ontario.ca, which also explains how to file a complaint.