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My electric water heater is 25 years old. Within the last few weeks it will suddenly not heat water all the time. The first time my brother-in-law told me to hit the reset button. Since I could not find one at all, he told me to turn off the circuit breaker, wait 15-30 minutes, and turn it back on. This makes the heater work and I get hot water. Lately it is happening more frequently (sometimes daily, other times every 2-3 days).
The breaker does not trip by itself, I turn it on/off to "reset". A plumber gave me an estimate of $2,000 to replace the 50 gallon tank -- this includes city permit, electrical work (he insists city requires new breaker), replace the faucet that turns water off (it is frozen), hot water tank, city inspection afterwards, and draining/removing old tank.
Before he gave me this price, he said the tank was in great shape for its age (no rust, looks good, water runs clear) and that it probably was the thermostat. But he will not just replace the thermostat because he says it is 25 years old, too old for him to fix (yet he just said it was in good shape). $2,000 is a lot of money, and there is nothing wrong with the circuit breaker, but he says it is "best to do it all at once".
For 2K you are being ripped off. New water heaters are much more efficient than a 25 year old one, so you don't need to upgrade the electrical and you don't need a permit to just replace a water heater (I checked on Dalla's web site). You can get a 50 gallon hot water tank for about 500.00. You need to replace the shut off valve though, that should run 30-50 bucks with labor (you will be without water while it is replaced).
Your thermostat is needing replaced, but with a 25 year old water heater, it's best to replace with a new one. More things will go wrong with it when it gets this old. It's been a good water heater lasting that long and has served you well; time to retire it and buy new.
I agree with earlier posters that $2,000 is excessive. A 25 year old hot water heater has out lived its normal life. All you need is a hot water heater, and a new valve.
I agree that you need to replace the heater. You've been very fortunate that it has lasted so long. $2,000.00 sounds way too high. I'd shop for a new heater at Lowe's or Home Depot and hire a reputable plumber to install it. I think you should be able to get everything done for around $1000.00.