Are you thinking of buying a tankless water heater but are unsure if it’s a more economical solution than gas water heaters in the long run?

But, how much electricity does a tankless water heater use? Electric tankless water heaters consume between 2 and 30 kilowatt-hours daily, depending on hot water use. On the other hand, gas units can consume 50 to 250 watts per day.

I also understand why you’d want to know the tankless water heater electric cost. So, read below.

Table of Contents

**Do Electric Tankless Water Heaters Require an Incredible Amount of Electricity?**

The US Department of Energy says the average household uses 20% of its energy allocation for water heating.

Although tankless water heaters work on-demand, they still require an incredible amount of electricity to run.

For example, a 30-kilowatt (kW) electric tankless water heater requires 30,000 watts to raise the cold water temperature to the ideal level.

On the other hand, a washing machine might only need about 1,200 watts to run.

However, it’s worth noting that a washing machine typically runs for one to two hours. Meanwhile, an on-demand water heater only operates when someone uses hot water.

Hence, it’s not surprising to learn that ten minutes’ worth of a relaxing hot shower will only cost you less than a dollar.

According to the Department of Energy, tankless water heaters are 24 to 34 percent more energy efficient than tank systems, allowing families to enjoy lower monthly electric bills.

Although an electric tankless water heater wattage is greater than any other home appliance, it doesn’t automatically translate to higher electric bills. It’s worth remembering that these water heaters only work when using hot water.

**How Much Electricity Does an Electric Tankless Water Heater Use?**

Many people ask, how many watts does a tankless water heater use? It’s a valid question because it helps determine the amount of electricity your water heater uses.

Try checking the manual for its wattage rating. If you’ve lost your user guide, you can check the technical information panel on your water heater. You should see its power ratings on the plate. If you can’t find any, you might want to check online.

Some units only use 4,500 to 5,500 watts of electricity, while others might run from 13,000 to 30,000 watts.

Let’s say you have a 10-kW electric tankless water heater, and you use it only for two hours every day. In that case, your electric tankless water heater consumes 2,000 watts daily.

Using the tankless water heater for only 15 minutes every day will consume about 2,500 watts or 2.5 kW.

**How Much Does It Cost to Run an Electric Tankless Water Heater?**

Knowing how much you’ll be paying for using an electric tankless water heater isn’t as complicated as some think. You only need two things: your water heater’s energy consumption and the kWh price in your community.

Although the average electricity price in the US is 10.42 cents or $0.1042 per kilowatt-hour (kWh), states have varying rates.

For example, Louisiana has the lowest kWh price as of September 2021 at 9.37 cents per kWh. The most expensive is Hawaii, with 32.76 cents per kWh. Alaska has the highest electricity cost at 22.54 cents per kWh on the mainland.

It would be wise to check your local electric utility for the ongoing prices. Alternatively, you can look at your monthly electric bill for the kWh price.

Suppose you have a 20-kW electric tankless water heater that you run for an hour every day. Let’s also say you live in Delaware with an average electricity price of 12.05 cents per kWh.

In that case, you can expect to pay only $2.41 every day for using your tankless water heater (20 kW x 1 hour = 20 kWh; 20 kWh x $0.1205 = $2.41).

You can multiply the product by 30 days to determine the electric hot water heater cost per month, yielding $72.30. You can also use 28 days for February or 31 days for the other months, whichever period you want to calculate.

Let’s say you use the same water heater for three hours. Your daily hot water consumption requires 60,000 watt-hours (20,000 watts x 3 hours). At $0.1205 per kWh, you can expect to pay $7.23 daily or $216.90 monthly.

You can also determine the electric tankless water heater cost per year.

- Most people would multiply their monthly water heater electric costs by 12 months. Unfortunately, it is not as accurate as factoring the daily consumption. Remember that we only multiplied the kWh cost by 30 days. Unfortunately, there are months with 31 and 28 days.
- Hence, I recommend multiplying the daily electric water heater cost by 365 days. In our first example (one-hour use of a 20-kW heater), you’ll be paying $879.65 annually ($2.41 x 365 days = $879.65). On the other hand, using the water heater for three hours daily will cost you $2,638.95 yearly.

Unfortunately, these figures are arbitrary. It would be best to understand that a tankless water heater doesn’t run on its rated power all the time. The inlet water temperature is a crucial factor in water heater performance.

For example, if you have 40-degree Fahrenheit water passing through the tankless water heater, it would take some time before the water reaches 140 degrees Fahrenheit.

Suppose the water temperature entering the tankless water heater is 70 degrees Fahrenheit, and you want it to heat to 140 degrees. In that case, the temperature differential is only 70 degrees, while our first scenario requires a 100-degree rise.

Hence, the water will use more power to heat the 40-degree water to 140 degrees before it settles down to nominal power. For instance, it might run at 20,000 watts for 15 seconds, while the other scenario will only require 10 seconds to reach 140 degrees.

Our calculations assume that we operate our tankless water heaters at full capacity or 100% rated power.

**How Much Electricity Does a Gas Tankless Water Heater Use?**

It’s essential to understand that modern gas-powered tankless water heaters also have electrical components, such as the ignition system and controls. However, the amount of electricity these units consume is not as significant as electric versions.

For example, Rinnai gas tankless water heaters require two watts of standby power before throttling to 25 to 65 watts, depending on water flow rate and temperature.

Using this gas tankless water heater for two hours will consume 50 to 130 watts (0.05 to 0.13 kWh). If you live in New York, where the average kWh price is 19.30 cents, you will pay 0.965 to 2.5 cents daily. That’s $28.95 to $75 monthly or $352.225 to $912.50 annually.

Of course, you will also pay for your natural or propane gas consumption. Regardless, gas-powered tankless water heater energy costs are still lower than electric versions.

**Conclusion**

Determining how much electricity does a tankless water heater use is fairly easy. You only need to look for your water heater’s wattage rating and multiply the figure by the number of hours you’ll run the tankless water heater.

If you want to know how much it’ll cost you to use your tankless water heater, you can multiply the average power consumption by the kWh price in your area. You can then multiply it by 30 or 365 days to determine your monthly or annual water heater-related electric bill.