Tankless Gas Hot Water Heaters Pros and Cons

Tankless gas water heaters have an incredible immediate appeal. Instantaneous, endless hot water; as much as you want, whenever you want it. A more efficient approach to keeping your water hot, and a more economical solution than traditional tank-style water heaters.

It’s an attractive option. But just like any other major renovation, there are pros and cons to tankless gas water heaters. Are they right for you?


There’s no question that tankless gas hot water heaters are much more efficient than the alternatives; according to the U.S. Department of Energy, saving about $108 per year on your energy bill when compared to traditional tank water heaters, as well as $64 per year when compared to electric tankless heaters.

Pretty great, right? It most assuredly is. However, these savings are offset by a pretty substantial up-front cost; tankless water heaters can cost significantly more than traditional storage heaters, ranging from around $1,000 for a tankless electric, whole-house model, to three times as much for a gas-powered model, once you’ve paid for installation by a qualified plumber.

If that wasn’t enough, there’s also the minor issue that some homes aren’t ready to support tankless water heaters, and will require some renovation. If your home is currently running on an electricity-only utility model, you may need to rewire your home, which means hiring a qualified electrician and adding as much as $5,000 to the escalating cost of your renovations.

Other Benefits

With these costs, is a tankless water heater still worth it? Well, there’s also a suite of benefits beyond just the energy savings.

Some homeowners appreciate the space-saving, compact design. It’s generally understood that they last a great deal longer, often coming with 15-year warranties, as opposed to traditional water heaters, where a six-year warranty is weighing in on the longer side. Reliability also factors in; since they don’t store water, there’s no risk of a breakdown leading to flooding, no water on the floor and a suite of unwanted hassles.

Additionally, there’s an environmental impact – with no rusty tanks cluttering up landfills, they present an appealing green option.

Points to Consider

If you’re still not certain whether or not a tankless gas hot water heater is right for you, it’s worth considering whether you intend to heat a single bathroom or your entire house. Electric models have a lower cost, but gas models have a higher efficiency – usually qualifying for federal tax rebates, as well as state-level incentives, due to their higher efficiency rating.

Whatever you decide to do, the dream of on-demand hot water is achievable; it just takes some careful planning to get there.

Skip to content