I live in Florida, and we have warm temps most of the year. The water heater is kept in the garage and the garage is usually warmer than the outside temperature most times of the year. I'm telling you this, because it is relevant to the choice i made for my water heater.
When I had to replace my standard electric water heater, i opted for a Ge Hybrid which combines the standard electric coils with a heat pump. the heat pump can produce lots of hot water cheaply, but if it every gets really cold, the heater kicks in the electric coils to supplement the heat pump.
So after 5 years, it started to leak, and I bought it at Loews, and when I bought it I also paid $79 for an extended labor warranty. I had to extend the labor because Ge put 10 years on the tank. So after it leaked, the service company sent an inspector at no cost to me, and he took pictures and wrote it up in his report. The outcome of the $79 was that they refunded the entire $1500 I paid for the water heater, and told me to buy whatever I want, and they would pay for it to be installed.
So the Hybrid did lower my electric bills, and it did it in a very noticeable way. if i had no insurance, the tank failure would have made my savings zero, and it would have ended up costing me more than if I had gone to a regular electric heater.
So the new model of the GE Hybrid, as of last month, went down to $999.00, and it was improved in many ways, more mental, and a nicer design all the way around. I paid Loews $99 for the same extended warranty, and the insurance company paid my plumber $546.00 to install the new model, and i put approximately $500.00 back into my bank account. Don't ever buy a Hybrid without and extended warranty.
The moral of this story is that paying more is not always the more expensive way to go. if you live in a hot climate for most of the year, the hybrid is a good way to go. it blows cold air into it hot environment, but it does not blow enough to make my garage cool