Tankless water heaters are a good alternative if you don’t have room for a traditional tank or don’t require much hot water. This article will cover the following things:

  • When it is required to install a tankless water heater?
  •  Which is the best tankless water heater?
  • The cost of a tankless heater and its estimation.
  • Tankless heater costs.

Best tankless water heater if you’re ready to purchase and install one. In that post, we compare electric tankless water heater prices and models. Check out our buyer’s guide and review of hybrid water heaters if you are looking for a water heater that is more energy efficient.

The Operation of Tankless Water Heaters

These water heating equipment come in the form of square panels that are fixed to the wall and may be powered by electricity, natural gas, or propane. They are also known as instantaneous water heaters and on-demand water heaters. A flow sensor monitors the cold water that is flowing through the device, which triggers the activation of the heat exchanger whenever the hot water is switched on in the house. The water is brought up to the required temperature as it passes through the heat exchanger and receives the heat. They do not need a storage tank since the water is only heated as it travels through the device. This eliminates the need to wait until you are ready to use the hot water.

Pros and Cons

Tankless water heaters have grown popular in the U.S. Unlike typical electric water heaters, and they only heat water when needed. Changing from a standard tank will increase installation costs.


  • Tankless water heaters are cheaper to run, saving hundreds each year. Most 40-gallon electric water heaters cost $200 per year to run, whereas tankless alternatives cost less than $100 per year.
  • Tankless water heaters consume less energy and produce fewer emissions. The ones having a lower carbon footprint are also called hybrid water heaters.
  • Tankless water heaters are smaller and wall-mounted so they may fit in tiny laundry rooms and closets.
  • Tankless water heaters last 20 years, 2-3x longer than storage tanks.
  • Safer, cleaner Tankless types don’t leak water, grow Legionella bacteria, or topple in an earthquake. Because the air supply and exhaust ports are both sealed, there is no possibility of carbon monoxide poisoning or gas leaks.
  • Winterizing a tankless water heater takes seconds compared to draining traditional tanks.


  • Tankless water heaters may cost extra, depending on your house. Most American homes have traditional electric water heaters, and converting involves more work and components than replacing an old device.
  • Tankless water heaters are great if you don’t require a lot of hot water at once. Models with 13 GPMs (enough for a large family to shower simultaneously) are pricey ($2,400).
  • If your installation expenses are substantial, the monthly savings will take longer to pay off. Divide the total cost by the monthly or annual savings to find out.
  • Tankless water heaters cost $1,100-$4,600. It may mention the total installation cost. The unit, labour, and components cost. It is far more essential than the price of the tankless water heater.

Tankless water heater pricing

The usual cost is 350$ and may extend till 2450$. The price of a tankless water heater is affected mainly by its GPM capacity. The cost of an on-demand water heater is proportional to its storage capacity.

You can break down the cost of a tankless water heater into two categories: the labour cost, which is determined by how long it takes and how much a plumber charges, both of which are influenced by the cost of living in your city. There are reports that plumbers charge $45-150 per hour, with the average being $85 per hour. Electric tankless heater installation takes 2-3 hours and costs $90-450. Gas tankless heaters cost $1,200 + $500-1,000 to establish a gas hook-up. In rare circumstances, tankless heater installation needs drywall work by a carpenter.

It might cost anything from $25 to $500 for a plumber to remove and remove your old water heater. The easiest way to find a plumber at a price that fits your budget is to get many quotes from different companies.

The typical plumber would recommend a water heater with more than enough capacity and accounts for every possible edge case. If a plumber installs a remote unit and a homeowner uses all three showers simultaneously, they face the danger of receiving unfavourable reviews. However, plumbers make more money selling bigger units.

Why bother hiring a professional? Each house, individual, and family is unique

I’m writing from a 1,100-square-foot house (half the average). Eight hundred square feet was my previous apartment. We’d require significantly fewer GPMs than typical. Hence a tankless water heater would be cheaper.

Your property may be set up for a tankless alternative, which might cost a few hundred dollars to install. Find a local plumber on Google or Yelp to obtain a quotation on a tankless water heater. You may purchase a $350 tankless water heater and hire a plumber for $400 to install it ($750 total). It is similar to installing a 40-gallon conventional water heater. Heat pump water heaters cost $500 more.

Tankless water heater operating cost

Next, calculate your tankless water heaters’ monthly or yearly operating expenses. We will inform you how much your unit will cost to run annually. Manufacturers often include it in product data. These are averages because many variables affect operational costs.

Tankless water heater energy factor evaluates efficiency. Energy Star rates tankless water heaters 0.96 to 0.99 for energy efficiency. Higher efficiency means lower operating costs.

Total energy consumption is the energy factor multiplied by the frequency of use. Electric heaters use kWh/yr. Gas units are measured in BTUs per year.

To obtain the annual running cost, multiply the projected energy usage by the energy cost—cents per kilowatt hour measure electricity expenses (kWh). Terms, BTUs, and cubic feet measure natural gas expenses. Use this EIAs calculator to convert them.

Electric tankless water heaters can cost around 75 – 360$ per year. You may also consider a pump water heater if you want a tankless water heater for your complete house. They’re the most energy-efficient water heaters and will save you hundreds. Heat pump water heater reviews may be of interest.

Finding the proper water heater size

The size affects the cost and it involves two factors:

  1. The heating time.
  2. Flow rate measures maximal water heating capacity.
  3. Temperature Rise (T) – The groundwater temperature dictates how much energy is required to heat the water. You may calculate the temperature rise by subtracting the desired hot water’s temperature from the groundwater’s temperature.

Higher temperature rises reduce flow rates. Almost all models’ product description lists GPMs dependent on temperature increases.


While typical water heaters often need replacement when the tank begins to corrode or leak, tankless water heaters feature readily changeable components. That means it may mend them for years before they need to be replaced, mainly if the issue is detected early, which is another advantage of regular maintenance. If you discover any problems with your tankless water heater, turn it off immediately and contact L&S Turnkey today.