Tankless water heaters are the future. The first thing everybody in the market for a tankless heater (be it gas to electric) wants to know is this:
How much does a tankless water heater costs?
That’s a quite on-point question. When you explore a bit more, you will also likely want to know how much does a tankless water heater installation costs.
Here’s the deal:
Tankless water heaters cost anywhere from $200 to $2,850. Example: The upfront cost of an Eltron Stiebel 10 kW small electric heater is around $500. The big 11 GPM Rinnai gas tankless water heater costs $1,700 or more.
The cost of installing a tankless water heater is anywhere between $500 and $3,600. You have to add quite a few $100 for labor cost to install a tankless water heater as well.
These are ballpark figures. Here’s the important part:
Every homeowner should be aware that there are 3 primary costs associated with every electric or gas tankless water heater. These are:
- Upfront cost of a tankless water heater.
- Tankless water heater installation cost and labor cost.
- Running costs; cost of gas for gas units and electricity for electric units. You can estimate how much electricity do tankless water heaters use per hour, month, and year here.
Now, out of these 3 factors, we will look closely into the upfront cost of Navien, Rinnai, Noritz, Rheem, and Bosch electric and gas tankless heaters.
We will also specify what sort of price you can expect to be quoted by an HVAC company for installing a tankless water heater. For more information, you can get some free quotes for tankless water heater installation here (just fill the form and you’ll get some estimates of how much it would cost to install a unit in your area).
What is perhaps more important than both the upfront unit cost and installation costs are the running costs and energy savings. These are the answer to why you would even think about spending several $1,000 on a new tankless water heater.
A large reason why to buy a tankless water heater is that it has much lower running costs than conventional 30-, 40-, or 50-gallon water heaters. It heavily reduces hot water bills.
In fact, here is a quote from the US Department Of Energy’s (DOE) energy saver chart:
“For homes that use 41 gallons or less of hot water daily, tankless water heaters can be 24%–34% more energy-efficient than conventional storage tank water heaters.” (DOE on the efficiency of tankless water heaters)
The key consideration when checking how much tankless water heaters cost is to have energy savings in mind. Example: If your hot water bill with a conventional water heater was $100 per month, it will likely be $70 per month with a tankless hot water heater.
With that in mind, let’s first look at how much tankless water heaters cost (both gas and electric). After that, we will look at how much installing a tankless hot water heater costs and how much extra you will have to pay for labor.
By the end of this overview article, you will be able to summarize the total tankless water heater costs (upfront unit cost + installation + labor) for your specific hot water needs and situation.
Upfront Cost Of Electric Tankless Water Heaters
Electric tankless heaters are considerably cheaper than gas units. They are, however, smaller and electricity costs about 3 times as much as natural gas.
The price of electric tankless heaters ranges from $200 to about $900. The upfront price depends primarily on two factors:
- Size. The size of electric tankless heaters is determined by the electric input (measured in kilowatts or kW for short). Sizes range from the smallest 12 kW units that cost anywhere from $200 to $600 to the biggest 36 kW units with a $500 to $900 price tag.
- Brand. Brand is important; the quality and reliability of any unit are primarily determined by the brand. The best electric tankless heater brands are Stiebel Eltron, Rheem, Bosch, Ecotouch, and Eemax. Rinnai, for example, doesn’t produce electric tankless heaters. The more reputable a brand, the higher the cost.
The best brand for electric tankless heaters is Stiebel Eltron. They are a German company and have had dominance in this market for quite some time now. Here is how much Stiebel Eltron electric tankless heaters cost by size:
|Size Of A Stiebel Eltron Unit:
|Price Of Electric Tankless Heater (Est.):
As you can see, the cost of a tankless heater increases with size. However, it’s important to understand that the cost per additional kW of power doesn’t increase linearly.
Example: 12 kW unit costs $450. A 3 times more powerful unit – the 36 kW model – doesn’t cost 3 times as much (that would be $1,350). It costs $750.
Here is a graphical representation of the costs of electric tankless heaters by Stiebel Eltron:
If you’re looking to buy an electric tankless heater, Stiebel Eltron is the go-to brand. Before you do buy a unit, you might read our article about what size electric tankless heater would be best for your hot water needs here.
You can find Stiebel Eltron units as the top-ranking electric tankless heaters here.
Do be aware that the costs of installing an electric tankless heater are much lower than for gas units. Electric heaters don’t require venting (they might require circuit upgrade to the 240-volt circuit) and that makes all the difference in the price of electric tankless heater installation (more on that under installation costs further on).
Upfront Cost Of Gas Tankless Water Heaters
Gas tankless water heaters cost more than electric tankless heaters. They are also more expensive to install because they require proper venting. However, they are more powerful than electric units, and, more importantly, incredibly cheap to run (because they run on natural gas or propane which are anywhere from 50% to 80% cheaper than electricity).
The incredibly low running costs also justify the higher upfront and installation price of gas-powered tankless water heaters.
The cost of gas tankless water heaters follow the same 2-factor principle as electric units. The upfront price depends on:
- Size. The size of gas units is measured in Gallons Per Minute or GPM. The smallest 4 GPM gas tankless units cost $700 and the biggest 11 GPM Rinnai units can cost as much as $2,500.
- Brand. The brand is even a more important factor here than with electric units. In addition to quality and reliability, you need quite a lot of safety assurance here, and the reputable brands do give you do. The best gas tankless heater brands are Rinnai (by far), Noritz, Navien, Rheem, and Bosch.
Do note that the choice of gas – either natural gas or propane – doesn’t make a lot of different price-wise. That is to say that a propane tankless water heater costs the same as a natural gas tankless water heater.
If you would compare the price of Navien gas tankless water heaters to the price of Rinnai gas tankless heaters, you will see they are neck-a-neck. However, Rinnai, a Japanese company, is the behemoth in the gas tankless heater business and they arguably make the best gas tankless heaters.
To illustrate how the price of gas tankless hot water heaters increases with size (increasing GPMs), let’s have a look at Rinnai’s best series of gas units:
|Size Of A Rinnai Unit (GPM):
|Price Of Rinnai Tankless Heater (Est.):
Here is a graphical representation of the pricing of gas tankless water heaters:
Rinnai is the brand for gas tankless heaters. They have more than a 100-year tradition and are the most popular choice.
If you’re in the market for a gas tankless water heater, make sure that you properly size your unit to your hot water needs. You can consult our tankless hot water heater sizing article (with 2 examples) here.
Let’s have a look at how much does the whole tankless heater installation cost:
Electric Tankless Water Heater Installation Cost
Electric tankless water heater installation costs anywhere from $300 to $1,700; considerably less than gas unit installation.
The price of installing a tankless water heater has quite a broad range. The factors determining the final costs include:
- Existing electric circuit state. All electric units require a large amount of electric power. That means you will have to have a 240-volt circuit and several 30-amp breakers. Upgrade to the 240-volt circuit and all those amp breakers add to the cost of installation.
- Location – State and city. Obviously, installing a tankless water heater in San Francisco, California, will cost you more than in Houston, Texas. The higher the living standards, the higher the cost of electric tankless water heater installation.
- Size of the unit. Bigger units cost more to install.
- Installation complexity. A lot can go wrong during installation; these costs can be quite unpredictable and are hard to quantify.
The labor cost to install an electric tankless heater is extra. Depending on where you are, if you hire an individual installer of an HVAC company, you are expected to pay anywhere between $40 and $160 per work hour. Most electric tankless heaters come with several $100s extra for labor.
In many cases, installing an electric water heater + labor costs the same or even more than the upfront unit cost.
Gas Tankless Water Heater Installation Cost
Gas tankless water heater installation is quite expensive. You’re expected to pay at least about $1,000 for installation. Installing some bigger units will cost you up to $4,000 (labor included).
Installing a gas unit is quite a complex job. Here are some costs associated with a gas tankless water heater installation (these prices can vary quite a bit):
- Gas connector: Around $30.
- Termination vent: Around $80.
- Brass valve set (two-piece unit): $90.
- Piping: $12 per foot.
- Hardware mounting: $25.
Similar to electric unit installation, the installation costs have quite a range. How much you will actually pay for gas tankless water heater installation depends on:
- Location – State and city. Installing a gas tankless water heater in places with higher living costs will be more expensive. You can get an HVAC installer in Arizona for less than $70 per hour. No HVAC installer in California will be prepared to work for less than $70, for example.
- Gas-venting preparedness. Every home is different. In some homes, it’s easy to vent a gas tankless unit, in some homes, it’s more difficult. The price of installation will depend on how easy the venting part of tankless gas water heater installation is.
- Size of the unit. More likely than not, you will pay more for an 11 GPM Rinnai unit to be installed than for a 7 GPM unit.
- General complexity of installation. Unforeseeable installation problems can lead to a higher cost of installation.
As for labor costs, you’re expected to pay anywhere from $40 and $160 per work hour. The whole labor bill for gas tankless water heater installation is, on average, higher than for electric tankless heater installation. You can read all about electric vs. gas tankless water heaters, with advantages and disadvantages, here.
That’s because installing a gas unit (that requires venting; electric doesn’t require venting) will take longer and you will get billed more working hours.
The price of all units can be further increased by adding a tankless water heater recirculating pump. This pump will get hot water to your faucet quicker, it will also save water, but it does cost about $200 to $500 extra.
We have also written about if tankless water heaters are actually worth it here. You can use the calculator there that will help you find out if tankless water heaters save money or not.
Who To Call If You’re In The Market For A Tankless Water Heater + Installation?
You can buy a tankless water heater on your own, or an installer might buy it for you. In any case, it’s almost impossible to DIY tankless water heater installation, which means that you will eventually need an installer.
We can suggest some HVAC installers in your area if you need help. They will also give you more realistic quotes for your specific situation and do all the hands-on work. You can use this form to get up to 4 free quotes from HVAC guys in your area.
We hope all of this gave you some insight into how much tankless water heaters cost and how much you’re expected to pay for having them installed.