A tankless water heater costs $2,622 on average. Depending on size, fuel type, quantity, and on-site issues, you could spend between $1,399 and $3,889. If you've ever experienced a shower without hot water, you know how unpleasant it can feel to hop into an ice-cold shower.
However, this efficiency does come at a cost. The initial investment for a tankless water heater is typically higher, with prices ranging from $1,000 to $3,000 or even more, depending on brand, size, and specific features.
According to the US Department of Energy, tankless water heaters can be up to 34% more efficient than traditional tank-style models. This is because they only heat water when it's needed, eliminating standby energy loss. Furthermore, tankless water heaters have a longer lifespan compared to tank-style models.
Before you commit to buying a tankless water heater, the primary drawbacks to know include: Higher upfront costs. Tankless water heaters are, on average, quite a bit more expensive to buy and install than tank water heaters. Access to fuel.
While there are upfront costs involved, the long-term benefits make it a cost-effective choice for many homeowners. The average cost to install a tankless water heater ranges from $1,200 to $3,500. The conversion cost includes several factors: Price of the new tankless water heater.
Absolutely! In fact, tankless water heaters are becoming the standard for new home construction because of the energy efficiency.
Installing a tankless gas water heater is a difficult and sometimes dangerous process. We highly recommend having a licensed professional plumber handle this job. Be sure to follow all local plumbing and electrical codes when sourcing and installing parts for your new water heater.
Additional Installation Costs
Tankless water heaters are much more complex than traditional hot water tanks. As a result, they require professional installation. If you're switching from a hot water tank to a tankless unit, you will likely need your gas lines rerouted, as well as a larger gas supply line.
The federal tax credit for tankless water heaters can lead to significant savings for homeowners. Eligible tankless gas water heaters must have an ENERGY STAR certification and a UEF of greater than 0.95. Homeowners can claim up to $3,200 in tax credits for eligible home improvements in a single year.
While a tankless water heater will deliver an unlimited stream of hot water, they struggle to deliver a lot of hot water at one time. So while you might be able to take 100 showers in a row if you have the dishwasher, washing machine, and shower going at the same time you might have problems.
How Much Electricity Does a Tankless Water Heater Use? Many people wonder if tankless water heaters increase electric bills. The answer is no — tankless water heaters can save money on your monthly electric bill because they're 8%-34% more efficient than storage water heaters.
A 50-gallon water heater should be replaced with a tankless system with a 10 GPM flow rate just to be safe. Selecting the right flow rate ensures you won't experience cold showers or excessive energy costs. Proper sizing optimizes performance, providing hot water on demand without unnecessary waste.
Do I need to replace all my home's plumbing if I install a tankless water heater? Rarely is a complete overhaul necessary. However, you may need to upgrade certain sections of your plumbing, particularly those leading into and out of the tankless unit, to ensure proper water flow and volume.
Labor is a significant cost factor when installing a tankless water heater. It can add $500 to $3,000 to the cost of the project. Point-of-use models require less work to install, so you'll pay on the lower end for labor.
To summarize, a tank to tank installation can last up to three hours to four hours. Tank to tankless may last a bit longer. And going from a tankless to another tankless water heater will usually take no more than three to four hours.
The cost of a tankless water heater at Home Depot can vary depending on the type and features you choose. Generally, electric tankless water heaters have a lower upfront cost, ranging from $200 to $700, while gas-powered tankless water heaters can cost between $500 and $1,500 or more.
Federal Tax Credit for Energy-Efficient Appliances
As part of this program, the tankless water heater tax credit for 2024 provides homeowners with a financial incentive to upgrade their water heaters to more energy-efficient models.
Tax Credits for Water Heaters
Rebates are available for high efficiency gas fired tankless, gas-fired storage and for heat pump water heaters. Gas-fired tankless with UEF ≥ . 95 are eligible for up to $600 in rebates.
Unlike traditional storage water heaters, tankless units may not be able to meet your home's hot water needs if you have multiple outlets running simultaneously. This is because the flow rate of a tankless unit may not be high enough to support multiple uses of hot water at the same time.
Tankless water heaters usually last for around 15-20 years before they need to be replaced, but they may need replacing sooner if they start to break down or lose efficiency. Some common signs your tankless water heater needs to be replaced include: Low water pressure. Water doesn't get hot.
A tankless water heater cannot provide hot water faster than its ability to heat the water. While a tank unit can provide hot water for multiple uses at once, a tankless unit might not be able to support simultaneous usage, such as washing dishes, taking a shower and running a washing machine all at once.
Equipment purchase and installation runs $1,200–$3,500 for tankless heaters versus $800–$1,500 for traditional tanks. Tankless models use 24%–34% less energy when households use up to 41 daily gallons, according to ENERGY STAR.
As we discussed above, the biggest downside of owning a Tankless Water Heater is its higher cost. The initial installation costs and the price of the unit are more expensive than a traditional Storage Tank Water Heater. Another downside of a Tankless Water Heater is that it has limited hot water.
Switching from a traditional tank water heater to a tankless heater has its benefits, like energy efficiency, space savings, and a consistent supply of hot water. However, the transition comes with a higher upfront cost and potential challenges.