“Water heaters account for nearly 17 percent of a home’s energy use, consuming more energy than all other household appliances combined.” (DOE on water heaters)

Electric tankless water heaters require a **large amount of electrical power (when running)**. Surprisingly so, they are very energy efficient and economic. We will look into

*exactly*how much electricity does a tankless water heater use (by using the power equation

*P = I * V*and cost equation

*Cost = kWh * t (h)*).

We will also look into some examples of how costly it is to run 8 kW – 30 kW tankless heaters at 100% heating output:

**Per hour.**On average, $1,06 for a small 8 kW heater and $3,96 for a big 30 kW heater.**Per month.**Between $18,55 and $69,03*(more in the table below)*, with an average for a 4 person family of**$43,94 per month**.**Per year.**Between $222,60 and $831,60*(more in the table below)*, with an average for a 4 person family of**$527,10 per year**.

Let’s face it:

Heating water is one of the most **power-hungry processes**. Tankless heaters heat up the water in seconds *(15 seconds from cold to hot water)*. To achieve that, we need an incredible amount of electricity.

*Does that mean that tankless heaters require a lot of electricity?*

Yes and no. When they are ‘on’, electrical tankless heaters require up to 30,000W of electricity. For comparison, an average washing machine will require a bit more than 1,000W to run (and it will run for 1-2h). However, electric tankless water heaters are not running all the time. All this energy is used to heat up water ** only when we use hot water**.

*Example:* A 10 min scorching hot water shower will increase your electricity bill by no more than $1.

In fact, even according to the US Department Of Energy, tankless water heaters can significantly reduce monthly electricity bills:

“For homes that use 41 gallons or less of hot water daily, demand water heaters can be 2

4%–34% more energy efficientthan conventional storage tank water heaters.” (DOE on energy efficiency of tankless water heaters)

Most households use less than 41 gallons of water per day. **24% – 34%** is quite a lot of energy savings. Electricity-wise, tankless water heaters are a smart financial investment (they also **last for 10-15 years**).

But how can such a power-hungry appliance reduce the electricity bill?

Let’s calculate a bit to see how much electricity does an on-demand tankless hot water heater use:

Table of Contents

## How Much Does It Cost To Run An Electric Tankless Water Heater?

Calculating the maximum running costs of tankless water heaters is quite easy. The key information here is **how many watts** does a tankless water heater use. We’ll do one quick example here, with more to follow.

*Example:* You have a 20 kW electric tankless heater. How much does it cost to run it?

*Solution:* 20 kW heater will spend 20 kWh worth of electricity if you run it for 1 hour. The average kWh price in the US is $0,1319. That means a 20 kW tankless heater will spend, on average, 20 kWh x $0,1319 per kWh = **$2,64 per running hour**.

That doesn’t sound a lot, right? Obviously, there are many factors that come into play like intake water temperature, hot water demands, and so on. For a 20 kW tankless water heater, the $2,64 per hour is the **maximum** electricity usage (running at 100% heating output). You will likely run your heater 100% output for the first 15 seconds, and then the heating output percentage (and hence water heater costs) drops.

Now, the real question is this:

How many hours per day do you run the tankless water heater? Here is how much it costs to run a 20 kW electrical tankless heater from our example for different time periods:

- 20 kW running at 100% output for
**10 minutes**(shower):.*$0,66* - 20 kW running at 100% output for
**30 minutes**:.*$1,32* - 20 kW running at 100% output for
**1 hour**:.*$2,64* - 20 kW running at 100% output for
**2 hours**:.*$5,28* - 20 kW running at 100% output for
**5 hours**:.*$13,20*

Be aware that we always predispose the price of electricity to be $0,1319 per kilowatt-hour.

Not everybody owns a 20 kW inline tankless water heater. Let’s look at two very important numbers as far as electric tankless water heaters usage goes:

- How much electricity does a tankless water heater use
**per hour?** - How much electricity does a tankless water heater use
**per month?**Monthly electricity bill.

**Tankless Water Heater Electricity Usage By Hour**

There are only two variables when it comes to calculating the electricity usage of tankless water heaters per hour. These are:

**How many***watts*does a tankless water heater use?- What is the cost of electricity (kWh cost) in your area?

Again, we predispose the average price of electricity to be $0,1319 per kWh and that tankless heater is running at 100% heating output.

Here is a table with the maximum running costs of different sizes of electric tankless heaters per hour:

Wattage Of Electric Tankless Heater |
Cost Per Running Hour |

8 kW | $1,06 |

9 kW | $1,19 |

10 kW | $1,32 |

11 kW | $1,45 |

12 kW | $1,58 |

13 kW | $1,71 |

14 kW | $1,85 |

15 kW | $1,98 |

16 kW | $2,11 |

17 kW | $2,24 |

18 kW | $2,37 |

19 kW | $2,51 |

20 kW | $2,64 |

21 kW | $2,77 |

22 kW | $2,90 |

23 kW | $3,03 |

24 kW | $3,17 |

25 kW | $3,30 |

26 kW | $3,43 |

27 kW | $3,56 |

28 kW | $3,69 |

29 kW | $3,83 |

30 kW | $3,96 |

Do keep in mind that these numbers are only valid if an electric tankless water heater runs at 100% heating output. Most of the time, it runs on **less than 100%**. That information comes in handy when calculating how much electricity does a tankless water heater use per month:

### Monthly Tankless Water Heater Electricity Usage

The monthly electricity bill will tell the most realistic story of how much electricity does running an electric tankless water heater spend. That’s why it might be useful to see how much electricity different tankless water heaters use per month.

Now, the real problem here is that it’s really difficult to estimate how many hours per day we use the tankless heater, and what is its average output (mind you, it’s not 100% all the time).

We can use a very rough estimate: An average family of 3-7 will use the **equivalent of 35 min of tankless water heater use at 100% heating output**. This is based on 16-60 gallon per day needs in a 52˚F inlet water temperature area. The average energy efficiency of a tankless water heater of 97% is taken into account as well.

Based on this presumption and electricity cost of $0,1319 per kWh, we can calculate how much does it cost to run an electric tankless heater per month and per year:

Wattage Of Electric Tankless Heater |
Cost Per Month (Rough Estimate) |
Cost Per Year (Rough Estimate) |

8 kW | $18,55 | $222,60 |

9 kW | $20,83 | $249,90 |

10 kW | $23,10 | $277,20 |

11 kW | $25,38 | $304,50 |

12 kW | $27,65 | $331,80 |

13 kW | $29,93 | $359,10 |

14 kW | $32,38 | $388,50 |

15 kW | $34,65 | $415,80 |

16 kW | $36,93 | $443,10 |

17 kW | $39,20 | $470,40 |

18 kW | $41,48 | $497,70 |

19 kW | $43,93 | $527,10 |

20 kW | $46,20 | $554,40 |

21 kW | $48,48 | $581,70 |

22 kW | $50,75 | $609,00 |

23 kW | $53,03 | $636,30 |

24 kW | $55,48 | $665,70 |

25 kW | $57,75 | $693,00 |

26 kW | $60,03 | $720,30 |

27 kW | $62,30 | $747,60 |

28 kW | $64,58 | $774,90 |

29 kW | $67,03 | $804,3 |

30 kW | $69,03 | $831,60 |

Obviously, there are many variables that determine how much exactly does running an electric tankless heater cost. Nonetheless, according to the Department of Energy, tankless units do spend less electricity than conventional water heaters that run of electricity.

To reduce the electricity bill as much as possible, look for the Energy Star label. In our list of the best and most energy-efficient electric tankless heaters here, you will see that these units can have up to 99% energy efficiency.

It is also essential to size your tankless heater properly. You can read more about adequate tankless water heater sizing here. You’ll find the inlet water temperature map and 2 examples of how big a tankless water heater you need.

#### A Word On How Much Electricity Does A Gas Tankless Water Heater Use

Gas tankless heaters are another story altogether. They run on gas – either propane or natural gas. Gas tankless units require a minimal (insignificant) amount of electricity. The electricity is only used to upkeep the electric circuit; not for the actual water heating.

If you check the article about gas vs electric tankless heaters, you can see that gas units can be up to $1,000 more expensive than electric tankless units. You also need to add another $1,000 for installation. However, as far as the cost-efficiency of heating water is concerned, gas tankless water heaters are more economic.

That’s because gas – propane or natural gas – is about 3 times cheaper (per heating output) than electricity. If the average yearly cost of running an electric tankless water heater is $527,10, running a gas-powered tankless heater will cost only about $175,70 due to the lower cost of gas.

The amount of electricity that is needed to upkeep an inline gas water heater is **below $10 per year**.