Tankless vs tank water heater in the USA: worth it?
https://infohelper.net/home-energy/tankless-vs-tank-water-heater · Updated 14 Oct 2026
At US prices gas tankless saves $84 a year on gas, so it pays off only if it costs under $1,680 more; electric tankless saves at most $50.
- Gas tankless savesnew model
- $84
- a year, vs a basic tank
- Worth paying extraat most
- $1,680
- over its 20 years
- Electric tankless savesup to
- $50
- a year; a basic one costs $7 more
Updated · Prices: 12 months to Jul 2026 · EIA, ENERGY STAR · Gas priced per extra therm, monthly charge left out · State average, not your tariff
Is a tankless water heater worth it?
On running cost, only if it costs you less than about $1,680 more than a tank: that is what a new gas tankless heater takes off the gas bill in 20 years at US prices, $84 a year × 20 (about $18 a month for the gas tank against $11). That is 12 years to earn back each extra $1,000. In the 42 states with a per-therm gas price, the most it is worth paying extra runs from $760 in North Dakota to $2,260 in Florida; in the other 9, priced at the average, it is at most $8,500 (Hawaii).
Why not the bigger figure you may see elsewhere: a tankless heater changes how many therms you burn, not the monthly charge on the gas bill. So the gas is priced here at what one more therm costs, $1.124 for the US (our estimate, monthly charge taken out). At the average price, $1.575 with the monthly charge spread over every therm, the saving would look 40% larger, $117 a year, but that part is not money you would save.
So the answer turns on your two quotes more than on your state. A heater costs the same to run whoever installs it; the price difference you are quoted is what the saving has to repay.
| Water heater | Per month | Per year |
|---|---|---|
| Gas tank basic model | $17.89 | $215 |
| Gas tankless, basic non-condensing, legal minimum; steel vent | $12.82 | $154 |
| Gas tankless new, condensing: recovers flue heat; plastic vent | $10.93 | $131 |
| Electric tank basic model | $52.89 | $635 |
| Electric tankless, at best best possible (100% efficient) | $48.70 | $584 |
| Heat pump water heater new model | $13.52 | $162 |
A basic tankless heater, the non-condensing kind at the legal minimum, saves less: $61 a year. And a tankless heater is expected to last longer, about 20 years against 14 to 15 for a gas tank (how long each lasts).
Payback with your own quotes
Subtract the tank quote from the tankless quote. At the US saving of $84 a year, a $1,000 difference comes back in 12 years and $2,000 or more not within the 20 years the heater should last. For your state, take the yearly saving from its row in the table below.
| Extra price (rows) by saving a year (columns) | $50 | $75 | $100 | $125 | $150 | $200 | $250 |
|---|---|---|---|---|---|---|---|
| $500 | 10 | 7 | 5 | 4 | 3 | 3 | 2 |
| $1,000 | 20 | 13 | 10 | 8 | 7 | 5 | 4 |
| $1,500 | 30 | 20 | 15 | 12 | 10 | 8 | 6 |
| $2,000 | 40 | 27 | 20 | 16 | 13 | 10 | 8 |
| $3,000 | 40+ | 40 | 30 | 24 | 20 | 15 | 12 |
| $4,000 | 40+ | 40+ | 40 | 32 | 27 | 20 | 16 |
- Bold, underlined: back within 10 years
- back within 20 years, the heater's expected life
- not within its life, on running cost
Two things move the sum. Any paid upkeep, such as a yearly descaling visit, comes off the saving before you read the grid. And over 20 years a tank is likely to be replaced once, so a fair comparison adds part of a second tank to the tank side. What makes a tankless quote higher is listed under installing one.
Is it worth it for a small household?
A small household saves fewer dollars but a bigger share of its gas: at US prices $74 a year (45% less gas) at 38 gallons of hot water a day, against $97 (33%) at 84. The gas a tankless heater does not burn grows only from 66 to 86 therms a year while the hot water more than doubles, because most of it is heat a tank loses standing by, whatever you use.
The federal test rates water heaters at these three levels of use; the rest of this page uses the middle one.
| Hot water a day | Gas tank | Gas tankless | Saves | Worth paying extra at most, 20 years |
|---|---|---|---|---|
| 38 gallons small use | $165 | $91 | $74 45% less gas | $1,480 |
| 55 gallons medium use | $215 | $131 | $84 39% less gas | $1,680 |
| 84 gallons large use | $297 | $200 | $97 33% less gas | $1,940 |
A basic tankless heater saves $59, $61 and $62 at the same three levels. For the tank the small and large figures are a model: the legal minimum for that level of use applied to the same tank.
Endless hot water? Flow and showers at once
It never runs out, but it limits the flow: a typical certified gas tankless heater delivers 5.4 gallons a minute heating water from 58°F to 125°F, enough for 3 showers at once (3.1) at 2.5 gallons a minute and 105°F. Colder incoming water means fewer.
| Incoming water | Gallons a minute | Showers at 105°F | Showers, all hot water |
|---|---|---|---|
| 40°F | 4.3 | 2.2 | 1.7 |
| 50°F | 4.8 | 2.6 | 1.9 |
| 58°F the test's figure | 5.4 | 3.1 | 2.2 |
| 70°F | 6.6 | 4.1 | 2.6 |
Certified models range from 3.8 to 6.0 gallons a minute at the test's temperatures; the figure is on each model's label. Each also lists a minimum flow, 0.1 to 1.0 gallons a minute: a trickle below it gets no hot water.
A tank works the other way round. It stores hot water, then slows down while it reheats: certified gas tanks deliver a median 95 gallons in the first hour (86 to 118), and a basic tank's label gives its own first-hour figure.
Gas tankless or electric tankless?
Gas saves far more. Against an electric tank, an electric tankless heater saves at most $50 a year at US prices, and only if it turns all its electricity into hot water (100%, the best possible). One at the legal minimum (91%, less than the basic tank's 92%) costs $7 a year more. A gas tankless heater saves $84 a year against a gas tank.
The reason: an electric tank already turns almost all its electricity into hot water, so there is little left to save, while a gas tank loses heat up its flue.
Size is the other problem. One 2.5‑gallon shower at 105°F, from 58°F water, takes 17.0 kW: 71 amps at 240 volts; two at once take 142 amps. Household electric tankless heaters, as federal rules define them, are 12 kW or less, which heats 1.76 gallons a minute to 105°F: less than one shower. A whole-house electric unit is larger than that, and an electrician has to confirm that your service can carry it.
| Incoming water | One shower | Two showers | A 12 kW unit heats gallons a minute |
|---|---|---|---|
| 40°F | 23.5 kW 98 amps | 47.1 kW 196 amps | 1.27 |
| 50°F | 19.9 kW 83 amps | 39.8 kW 166 amps | 1.51 |
| 58°F | 17.0 kW 71 amps | 34.1 kW 142 amps | 1.76 |
| 70°F | 12.7 kW 53 amps | 25.4 kW 106 amps | 2.37 |
On propane a tankless heater saves more, because propane costs more per unit of heat: about $207 a year at the US average propane price ($2.553 a gallon, Oct 2025–Mar 2026), so worth at most $4,140 extra over 20 years. 288 of the 460 certified gas tankless models run on propane.
Whether gas or electricity is the cheaper fuel for hot water in your state, heat pump included, is answered in dollars a month on gas vs electric water heater; that page prices gas at the state average, monthly charge included, because it compares keeping gas with giving it up.
How long does a tankless water heater last?
About 20 years, against about 14 to 15 for a gas tank. That is the US Department of Energy's estimate in its 2024 analysis of gas tankless heaters: "The estimated average lifetime for a gas-fired instantaneous water heater is about 20 years, whereas gas-fired storage water heaters operate for about 14 to 15 years." The rule that analysis supported was withdrawn in 2025; the estimate is quoted as the Department's figure, not as a guarantee.
The longer life comes with upkeep. For the efficient tankless heaters the Department counts "condensate withdrawal and deliming of the heat exchanger" as maintenance; deliming means removing the mineral scale that builds up inside. This page puts no price on that; subtract what you pay for it from the yearly saving.
A heat pump water heater instead?
In some states: a typical new heat pump water heater costs $13.52 a month to run at US prices, against $10.93 of gas for a new gas tankless heater. By state it is cheaper in 12, about the same (under $1 a month apart) in 7 and dearer in 32, with gas priced per extra therm. At the average gas price, monthly charge included, as on gas vs electric water heater, the heat pump is cheaper in 23, about the same in 8 and dearer in 20: that is the right comparison if the heat pump lets you close the gas account.
It is an electric tank with a heat pump on top, so it needs room around it and usually a 240‑volt circuit, and it keeps a tank's first-hour limit instead of a flow limit. What each of the four machines costs a month in your state is on that page.
Power cuts, and what installing one involves
In a power cut a gas tankless heater stops: all 460 certified models list a current draw, a median of 5 amps, for the fan and controls. A gas tank may keep heating, depending on the model: the Department of Energy notes that "some gas-fired water heaters do require electricity to operate", and others do not. All 71 ENERGY STAR certified gas tanks list a current draw (median 7 amps), so those stop too; a basic tank's label and manual say whether it needs power. Either way, hot water already in a tank can still be drawn.
A tankless heater burns much more gas at once than a tank: the typical certified model is rated at 180,000 BTU an hour, 3.6 times the 50,000 of a certified gas tank, so the gas pipe to it may need to be larger.
The vent changes too. The Department describes non-condensing tankless heaters as needing "stainless steel vent material", while condensing ones "can be vented through a PVC, CPVC, or polypropylene vent material". A condensing heater also makes liquid condensate, which needs a drain.
Check it against your own bill
Your own per-therm lines decide it. For Illinois this page uses $0.785 a therm, our estimate for the state, and the saving is $58 a year; on a Nicor Gas bill the per-therm lines add up to less, and the saving is about $43, worth at most $860 extra over 20 years. (At Illinois's average price, $1.136 with the monthly charge in it, it would look like $84 in Illinois.)
Illinois, a home on Nicor Gas
Nicor Gas Rate 1: distribution 24.44¢ and gas supply 33.00¢ a therm (Oct 2026). The monthly customer charge stays the same with either heater.
| Gas not burned | 190.99 − 116.66 = 74.33 therms a year |
|---|---|
| Saved a year | 74.33 × $0.574 = $43 |
Take your own per-therm lines (or per CCF, about one therm), leave out the fixed charge, and multiply by the therms. More in why the price here is not the price on your bill.
What does tankless save in your state?
Over 20 years, the life the Department of Energy expects of a gas tankless heater, the saving repays $1,000 of extra price in 49 of 51 (50 states and DC), $2,000 in 15, $3,000 in 5 and $4,000 in 1; the states at $3,000 and $4,000 are all priced at the average gas price, so those are upper bounds.
A heat pump water heater costs less to run than gas tankless in 12 states, about the same (under $1 a month apart) in 7 and more in 32.
Most a gas tankless heater is worth paying extra, thousand dollars
- repays $2,000 or more in 20 years, 15 states
- repays $1,500 to $1,999 in 20 years, 16
- repays under $1,500 in 20 years, 20
| State | Electricity ¢/kWh | Gas $ for one more therm | Gas tank $ a month · basic | Gas tankless $ a month · new | Heat pump $ a month · new | Worth paying extra $ at most, 20 years | Tankless saves $ a year | Electric tankless saves $ a year, at most | In one sentence |
|---|---|---|---|---|---|---|---|---|---|
| Alabama | 16.44 | 1.521 | $24.20 | $14.78 | $12.36 | $2,260 | $113 a year | 46 | Alabama: gas tank $24 a month, gas tankless $15; tankless saves about $113 a year, worth at most $2,260 extra. A heat pump costs less still, $12. |
| Alaska | 26.85 | 1.075 | $17.11 | $10.45 | $20.18 | $1,600 | $80 a year | 75 | Alaska: gas tank $17 a month, gas tankless $10; tankless saves about $80 a year, worth at most $1,600 extra. |
| Arizona | 15.40 | 1.441 | $22.93 | $14.01 | $11.58 | $2,140 | $107 a year | 43 | Arizona: gas tank $23 a month, gas tankless $14; tankless saves about $107 a year, worth at most $2,140 extra. A heat pump costs less still, $12. |
| Arkansas | 13.43 | 2.208 avg | $35.15 | $21.47 | $10.09 | ≤$3,280 | at most $164 a year | 38 | Arkansas: gas tank $35 a month, gas tankless $21; tankless saves at most $164 a year, worth at most $3,280 extra. A heat pump costs less still, $10. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. |
| California | 32.99 | 2.154 avg | $34.28 | $20.94 | $24.80 | ≤$3,200 | at most $160 a year | 92 | California: gas tank $34 a month, gas tankless $21; tankless saves at most $160 a year, worth at most $3,200 extra. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. Gas price: calendar year 2025. |
| Colorado | 16.55 | 0.858 | $13.66 | $8.34 | $12.44 | $1,280 | $64 a year | 46 | Colorado: gas tank $14 a month, gas tankless $8; tankless saves about $64 a year, worth at most $1,280 extra. |
| Connecticut | 27.99 | 1.418 | $22.57 | $13.79 | $21.04 | $2,100 | $105 a year | 78 | Connecticut: gas tank $23 a month, gas tankless $14; tankless saves about $105 a year, worth at most $2,100 extra. |
| Delaware | 17.79 | 1.236 | $19.68 | $12.02 | $13.37 | $1,840 | $92 a year | 50 | Delaware: gas tank $20 a month, gas tankless $12; tankless saves about $92 a year, worth at most $1,840 extra. |
| District of Columbia | 24.20 | 1.332 | $21.19 | $12.94 | $18.19 | $1,980 | $99 a year | 68 | District of Columbia: gas tank $21 a month, gas tankless $13; tankless saves about $99 a year, worth at most $1,980 extra. |
| Florida | 15.39 | 1.517 | $24.14 | $14.74 | $11.57 | $2,260 | $113 a year | 43 | Florida: gas tank $24 a month, gas tankless $15; tankless saves about $113 a year, worth at most $2,260 extra. A heat pump costs less still, $12. |
| Georgia | 15.12 | 0.694 | $11.04 | $6.74 | $11.37 | $1,040 | $52 a year | 42 | Georgia: gas tank $11 a month, gas tankless $7; tankless saves about $52 a year, worth at most $1,040 extra. |
| Hawaii | 43.51 | 5.712 avg | $90.91 | $55.53 | $32.71 | ≤$8,500 | at most $425 a year | 122 | Hawaii: gas tank $91 a month, gas tankless $56; tankless saves at most $425 a year, worth at most $8,500 extra. A heat pump costs less still, $33. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. Gas price: calendar year 2025. |
| Idaho | 12.65 | 0.608 | $9.68 | $5.91 | $9.51 | $900 | $45 a year | 35 | Idaho: gas tank $10 a month, gas tankless $6; tankless saves about $45 a year, worth at most $900 extra. |
| Illinois | 18.79 | 0.785 | $12.49 | $7.63 | $14.12 | $1,160 | $58 a year | 53 | Illinois: gas tank $12 a month, gas tankless $8; tankless saves about $58 a year, worth at most $1,160 extra. |
| Indiana | 16.94 | 0.736 | $11.71 | $7.15 | $12.73 | $1,100 | $55 a year | 47 | Indiana: gas tank $12 a month, gas tankless $7; tankless saves about $55 a year, worth at most $1,100 extra. |
| Iowa | 14.13 | 0.745 | $11.85 | $7.24 | $10.62 | $1,100 | $55 a year | 40 | Iowa: gas tank $12 a month, gas tankless $7; tankless saves about $55 a year, worth at most $1,100 extra. |
| Kansas | 15.09 | 0.876 | $13.95 | $8.52 | $11.34 | $1,300 | $65 a year | 42 | Kansas: gas tank $14 a month, gas tankless $9; tankless saves about $65 a year, worth at most $1,300 extra. |
| Kentucky | 13.92 | 0.983 | $15.65 | $9.56 | $10.46 | $1,460 | $73 a year | 39 | Kentucky: gas tank $16 a month, gas tankless $10; tankless saves about $73 a year, worth at most $1,460 extra. A heat pump costs about the same. |
| Louisiana | 12.99 | 1.178 | $18.74 | $11.45 | $9.76 | $1,760 | $88 a year | 36 | Louisiana: gas tank $19 a month, gas tankless $11; tankless saves about $88 a year, worth at most $1,760 extra. A heat pump costs less still, $10. |
| Maine | 29.31 | 1.366 | $21.75 | $13.28 | $22.03 | $2,040 | $102 a year | 82 | Maine: gas tank $22 a month, gas tankless $13; tankless saves about $102 a year, worth at most $2,040 extra. |
| Maryland | 21.03 | 1.378 | $21.94 | $13.40 | $15.81 | $2,040 | $102 a year | 59 | Maryland: gas tank $22 a month, gas tankless $13; tankless saves about $102 a year, worth at most $2,040 extra. |
| Massachusetts | 30.43 | 2.551 avg | $40.59 | $24.80 | $22.87 | ≤$3,800 | at most $190 a year | 85 | Massachusetts: gas tank $41 a month, gas tankless $25; tankless saves at most $190 a year, worth at most $3,800 extra. A heat pump costs less still, $23. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. |
| Michigan | 21.05 | 0.865 | $13.76 | $8.40 | $15.82 | $1,280 | $64 a year | 59 | Michigan: gas tank $14 a month, gas tankless $8; tankless saves about $64 a year, worth at most $1,280 extra. |
| Minnesota | 16.22 | 0.865 | $13.77 | $8.41 | $12.19 | $1,280 | $64 a year | 45 | Minnesota: gas tank $14 a month, gas tankless $8; tankless saves about $64 a year, worth at most $1,280 extra. |
| Mississippi | 14.77 | 1.179 | $18.76 | $11.46 | $11.10 | $1,760 | $88 a year | 41 | Mississippi: gas tank $19 a month, gas tankless $11; tankless saves about $88 a year, worth at most $1,760 extra. A heat pump costs about the same. |
| Missouri | 13.95 | 1.234 | $19.63 | $11.99 | $10.49 | $1,840 | $92 a year | 39 | Missouri: gas tank $20 a month, gas tankless $12; tankless saves about $92 a year, worth at most $1,840 extra. A heat pump costs less still, $10. |
| Montana | 13.84 | 0.694 | $11.05 | $6.75 | $10.40 | $1,040 | $52 a year | 39 | Montana: gas tank $11 a month, gas tankless $7; tankless saves about $52 a year, worth at most $1,040 extra. |
| Nebraska | 12.86 | 0.758 | $12.07 | $7.37 | $9.67 | $1,120 | $56 a year | 36 | Nebraska: gas tank $12 a month, gas tankless $7; tankless saves about $56 a year, worth at most $1,120 extra. |
| Nevada | 13.36 | 1.081 avg | $17.20 | $10.51 | $10.04 | ≤$1,600 | at most $80 a year | 37 | Nevada: gas tank $17 a month, gas tankless $11; tankless saves at most $80 a year, worth at most $1,600 extra. A heat pump costs about the same. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. |
| New Hampshire | 26.67 | 1.791 avg | $28.51 | $17.41 | $20.05 | ≤$2,660 | at most $133 a year | 75 | New Hampshire: gas tank $29 a month, gas tankless $17; tankless saves at most $133 a year, worth at most $2,660 extra. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. Gas price: calendar year 2025. |
| New Jersey | 23.78 | 1.217 | $19.37 | $11.83 | $17.87 | $1,800 | $90 a year | 67 | New Jersey: gas tank $19 a month, gas tankless $12; tankless saves about $90 a year, worth at most $1,800 extra. |
| New Mexico | 15.24 | 0.964 avg | $15.34 | $9.37 | $11.46 | ≤$1,440 | at most $72 a year | 43 | New Mexico: gas tank $15 a month, gas tankless $9; tankless saves at most $72 a year, worth at most $1,440 extra. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. Gas price: calendar year 2025. |
| New York | 28.39 | 1.423 | $22.64 | $13.83 | $21.34 | $2,120 | $106 a year | 79 | New York: gas tank $23 a month, gas tankless $14; tankless saves about $106 a year, worth at most $2,120 extra. |
| North Carolina | 14.77 | 1.507 | $23.99 | $14.65 | $11.10 | $2,240 | $112 a year | 41 | North Carolina: gas tank $24 a month, gas tankless $15; tankless saves about $112 a year, worth at most $2,240 extra. A heat pump costs less still, $11. |
| North Dakota | 12.32 | 0.513 | $8.16 | $4.99 | $9.26 | $760 | $38 a year | 34 | North Dakota: gas tank $8 a month, gas tankless $5; tankless saves about $38 a year, worth at most $760 extra. |
| Ohio | 18.25 | 0.714 | $11.36 | $6.94 | $13.72 | $1,060 | $53 a year | 51 | Ohio: gas tank $11 a month, gas tankless $7; tankless saves about $53 a year, worth at most $1,060 extra. |
| Oklahoma | 13.70 | 0.805 | $12.81 | $7.82 | $10.30 | $1,200 | $60 a year | 38 | Oklahoma: gas tank $13 a month, gas tankless $8; tankless saves about $60 a year, worth at most $1,200 extra. |
| Oregon | 15.50 | 1.332 | $21.20 | $12.95 | $11.65 | $1,980 | $99 a year | 43 | Oregon: gas tank $21 a month, gas tankless $13; tankless saves about $99 a year, worth at most $1,980 extra. A heat pump costs less still, $12. |
| Pennsylvania | 20.70 | 1.163 | $18.50 | $11.30 | $15.56 | $1,720 | $86 a year | 58 | Pennsylvania: gas tank $19 a month, gas tankless $11; tankless saves about $86 a year, worth at most $1,720 extra. |
| Rhode Island | 29.27 | 2.107 avg | $33.53 | $20.48 | $22.00 | ≤$3,140 | at most $157 a year | 82 | Rhode Island: gas tank $34 a month, gas tankless $20; tankless saves at most $157 a year, worth at most $3,140 extra. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. Gas price: calendar year 2024. |
| South Carolina | 15.64 | 1.462 | $23.27 | $14.21 | $11.76 | $2,180 | $109 a year | 44 | South Carolina: gas tank $23 a month, gas tankless $14; tankless saves about $109 a year, worth at most $2,180 extra. A heat pump costs less still, $12. |
| South Dakota | 14.20 | 0.716 | $11.39 | $6.96 | $10.67 | $1,060 | $53 a year | 40 | South Dakota: gas tank $11 a month, gas tankless $7; tankless saves about $53 a year, worth at most $1,060 extra. |
| Tennessee | 13.56 | 0.948 | $15.08 | $9.21 | $10.19 | $1,400 | $70 a year | 38 | Tennessee: gas tank $15 a month, gas tankless $9; tankless saves about $70 a year, worth at most $1,400 extra. A heat pump costs about the same. |
| Texas | 15.96 | 1.252 | $19.93 | $12.17 | $12.00 | $1,860 | $93 a year | 45 | Texas: gas tank $20 a month, gas tankless $12; tankless saves about $93 a year, worth at most $1,860 extra. A heat pump costs about the same. |
| Utah | 13.32 | 1.056 avg | $16.80 | $10.26 | $10.01 | ≤$1,560 | at most $78 a year | 37 | Utah: gas tank $17 a month, gas tankless $10; tankless saves at most $78 a year, worth at most $1,560 extra. A heat pump costs about the same. No per-therm estimate holds here: gas at the average price, monthly charges included, so the saving is an upper bound. |
| Vermont | 23.80 | 1.317 | $20.97 | $12.81 | $17.89 | $1,960 | $98 a year | 67 | Vermont: gas tank $21 a month, gas tankless $13; tankless saves about $98 a year, worth at most $1,960 extra. |
| Virginia | 16.48 | 1.297 | $20.65 | $12.61 | $12.39 | $1,920 | $96 a year | 46 | Virginia: gas tank $21 a month, gas tankless $13; tankless saves about $96 a year, worth at most $1,920 extra. A heat pump costs about the same. |
| Washington | 14.12 | 1.214 | $19.31 | $11.80 | $10.61 | $1,800 | $90 a year | 40 | Washington: gas tank $19 a month, gas tankless $12; tankless saves about $90 a year, worth at most $1,800 extra. A heat pump costs less still, $11. |
| West Virginia | 15.48 | 1.022 | $16.26 | $9.93 | $11.64 | $1,520 | $76 a year | 43 | West Virginia: gas tank $16 a month, gas tankless $10; tankless saves about $76 a year, worth at most $1,520 extra. |
| Wisconsin | 18.74 | 0.855 | $13.61 | $8.32 | $14.09 | $1,280 | $64 a year | 52 | Wisconsin: gas tank $14 a month, gas tankless $8; tankless saves about $64 a year, worth at most $1,280 extra. |
| Wyoming | 14.01 | 0.782 | $12.44 | $7.60 | $10.53 | $1,160 | $58 a year | 39 | Wyoming: gas tank $12 a month, gas tankless $8; tankless saves about $58 a year, worth at most $1,160 extra. |
Tap a state's name for its prices and what an electric tankless heater would save at most. Gas tank means the basic model; tankless and heat pump, typical new ones. Two figures less than $1 a month apart are both marked.
Gas is priced at our estimate of one more therm, the monthly charge taken out, because a tankless heater does not change that charge. No such estimate holds in Arkansas, California, Hawaii, Massachusetts, Nevada, New Hampshire, New Mexico, Rhode Island and Utah: their rows use the average price, so their savings are upper bounds, marked "at most" and "≤". (See why the price here is not the price on your bill.)
What a gas tankless heater saves over 20 years
How these numbers are calculated
The formula, per year, at 55 gallons a day
| Gas tank | 190.99 therms × gas price |
|---|---|
| Gas tankless | 116.66 therms × gas price |
| Gas tankless, basic | 136.83 therms × gas price |
| Heat pump | 902 kWh × electricity price |
| Electric tank | 3,528.0 kWh × electricity price |
| Electric tankless, at best | 3,248.2 kWh × electricity price |
| Saving | gas tank − gas tankless; worth paying extra = saving × 20 years |
All of them deliver the same hot water: 55 gallons a day heated by 67°F, the middle level of the federal test, 110.83 therms of heat a year. A machine's energy is that heat divided by its efficiency (uniform energy factor). The gas tank is the basic model, a 40‑gallon tank at the federal minimum (0.5803); the new gas tankless heater is the median of 460 ENERGY STAR certified models (0.95; they range from 0.95 to 0.98); the basic one is the federal minimum (0.81). The electric tank is at its minimum (0.9207) and the electric tankless heater at 1.00, the most electric resistance can reach.
A tankless heater stores no water, so it loses nothing standing by and one efficiency serves every level of use; the federal minimum is the same at all three. The tank's efficiency at small and large use is its legal minimum for that use.
Assumed, not verified: that the basic tank on sale sits at the legal minimum; the same incoming water temperature (58°F) in every state, which slightly understates the saving in cold states; the efficiency of propane heaters; and the 105°F shower. Left out: the electricity a gas tankless heater uses, which no open data gives; upkeep; purchase and installation, for which no public source has prices. The life figures are DOE's, quoted, not computed.
Gas is priced at our estimate of what one more therm costs (36 months to Jul 2026), because the monthly charge stays the same with either heater; where it does not hold, at the EIA average for the 12 months to Jul 2026, and those savings are upper bounds. At the average everywhere the US saving would be $117 a year, $2,340 over 20 years. How the state prices and the estimate are worked out: how the prices are calculated.
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Sources
- EIA: Electricity Data BrowserResidential revenue, sales and price by state, monthly; 12 months to Jul 2026. Edition of 23 Sep 2026.
- EIA: natural gas, average residential price by stateMonthly and annual residential price, volume and heat content by state; 12 months to Jul 2026. Edition of 8 Oct 2026.
- EIA: Heating Oil and Propane UpdateWeekly residential propane price by state, Oct 2025–Mar 2026. Edition of 7 Oct 2026.
- ENERGY STAR: Certified Water Heaters (dataset pbpq-swnu)Efficiency, maximum and minimum flow, gas input, current draw and first-hour rating of the certified gas tankless heaters, gas tanks and heat pump water heaters; 1,256 rows, edition of 13 Oct 2026.
- 10 CFR 430.32: energy conservation standards (eCFR)Paragraph (d): the minimum efficiency of the basic gas tank, electric tank, gas tankless and electric tankless heaters. Paragraph (p): the 2.5 gallons a minute of a showerhead. The definitions in 10 CFR 430.2 (same part): an electric tankless heater of the consumer class is 12 kW or less. Read 14 Oct 2026.
- 10 CFR Part 430, Subpart B, Appendix E (eCFR)The federal test for water heaters: the three levels of daily hot-water use, water in at 58°F and out at 125°F, and the maximum flow rating of a tankless heater.
- Federal Register, 89 FR 37778 (6 May 2024): standards for consumer water heatersDOE on power cuts (page 37796): "some gas-fired water heaters do require electricity to operate". Read 14 Oct 2026.
- Federal Register, 89 FR 105188 (26 Dec 2024): standards for gas-fired instantaneous water heatersDOE's analysis: the expected life of a gas tankless heater and a gas tank (page 105241), venting (105226), condensate (105206–105207) and upkeep (105230). The rule was withdrawn in May 2025 (90 FR 21390); its analysis is quoted, not its standard. Read 14 Oct 2026.
What changed
- Figures recalculated from updated source data.
- First published with prices for the 12 months to Jul 2026.