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Gas vs. Electric Tankless Water Heaters

One of the first questions you have when choosing a water heater is, “Gas or electric?” By this point, you’ve decided on the highly efficient tankless option but now what? There is a number of important factors to consider when choosing which water heater will better suit your needs and here, we have broken down all of the pros and cons for you.

On this post we’ll cover:

  • Price
  • Operating Costs
  • Installation Process
  • Maintenance
  • Water Needs
  • Unit Lifespan & Warranty
  • Environmental Impact


First and foremost, you need to decide on how much you’re willing to spend. Like anything else in life, prices vary with water heaters and the more features, the higher the price.

Electric tankless water heaters are substantially less expensive than gas. While a quality electric unit can be purchased for around $500, a gas unit will run you more at about $1,000 or more.

If you do prefer a gas tankless water heater, there are options that can lower the price overall. For instance, a non-condensing gas heater is much more affordable than a condensing unit but is also somewhat more expensive to initially install.

Operating Costs

The initial price of a tankless water heater is an important factor to consider, but unfortunately, costs don’t stop there. It’s also important to be mindful of the operating costs and budget accordingly.

There are two main points to remember when considering operating costs: the price of fuel and the efficiency of the unit.

Generally speaking, the price of electricity is higher than the price of gas in most locations, making electric units more expensive to operate. It’s also safe to say that the price of electricity is more stable than the price of gas. While gas prices vary from location to location and fluctuate quite often, electricity stays within a smaller price point range.

Although electricity is currently more expensive than gas, it’s more predictable and stable of a cost. Electric water heaters are also considered more efficient because they can produce more hot water with less fuel.

Installation Process

Installing a tankless water heater correctly is important to ensure high performance and safety. Because a tankless water heater, gas or electric, is a costly investment we highly recommend seeking professional help to install it correctly and securely.

Gas units can be far more intricate and complex to install, not to mention more expensive. This is because most require a venting system to provide the proper airflow and this can cause a complicated installation process.

Most home’s existing duct system for venting and gas lines are rarely compatible with gas tankless water heaters. This sometimes requires home modifications that can become quite the added cost.

Electric tankless heaters are much smaller components, often making for an easier and less costly installation. They also don’t require a ventilation system since there is no gas combustion and are far less complex overall.


When it comes to maintenance and upkeep, gas tankless water heaters require more maintenance than electric. Gas units require an annual inspection to ensure that the unit is running safely and efficiently while electric units do not. The only maintenance electric water heaters require are for their screen filters to be cleaned out annually.

Water needs

Tankless water heaters measure their water use by how many gallons per minute (GPM) a system can produce. Generally speaking, the amount of GPM an average family would need is somewhere between 5 and 8 GPM, but this is all variant depending on your specific needs.

Gas tankless water heaters are capable of producing higher GPM than electric heaters, making gas units a better choice for those with large families. Electric water heaters are still capable of producing a desirable amount of hot GPM, but less than gas. Both units’ efficiency is delivering hot water is dependent on the incoming water temperature.

Unit Lifespan & Warranty

Both gas and electric tankless water heaters should last for a full 20-year lifespan if maintained properly. Electric heaters can often time exceed their 20-years because their design and upkeep are so much simpler.

Gas units may have a more difficult time living out or exceeding their lifespan because they are much more intricate systems, requiring complicated maintenance. If not maintained properly, gas tankless water heaters will not run efficiently or last for their entire duration.

It’s safe to say that gas units will come with a 10-year warranty for their heat exchanger and 5- or 10-year warranties for other costly parts. Often times, they may also come with a 1-year warranty that covers labor costs.

Electric tankless water heaters commonly come with warranties, but the length varies. It’s safe to assume that a high-quality electric unit will come with a 5-year warranty for parts and a 1-year warranty for labor.

Environmental Impact

Like many would assume, an electric tankless water heater runs more efficiently than a gas one. Gas units emit greenhouse gases and consumers should be mindful of that when choosing a unit.

It’s important to know that if you do choose a gas unit, gas tankless water heaters run more efficiently than a traditional water heater and sometimes upwards of 80%.

Gas Tankless Water Heater: Pros

  • The price of gas is currently lower than the price of electricity
  • Gas units can achieve between 80 – 85% efficiency
  • Can produce more hot water GPM
  • Often comes with a sufficient warranty for parts and labor
  • Great option for those looking to upgrade from a traditional water heater

Gas Tankless Water Heater: Cons

  • More expensive to install due to the complexity of the system
  • May require home modifications upon installation
  • Require more maintenance than electric tankless water heaters
  • May not last as long as electric units
  • Using gas may become a safety issue in the event of a natural disaster
  • Gas prices fluctuate often 

Electric Tankless Water Heater: Pros

  • Significantly less installation cost
  • Electric units are about 1/3 of the size of gas units
  • Do not require ventilation
  • Do not require frequent maintenance
  • Generally operate at an efficiency level of 98 – 99%
  • Can exceed a 20-year lifespan
  • No negative impact on the environment
  • The cost of electricity is generally stable

Electric Tankless Water Heater: Cons

  • Price of electricity is currently higher than the price of gas
  • Cannot produce as much hot water GPM as a gas unit
  • It’s common for electric units to have lesser warranties

A tankless water heater is a costly and important investment for your home, so it’s crucial to fully understand your options. There are a number of factors to address between choosing an electric or a gas tankless water heater such as installation costs, maintenance costs, environmental impact, lifespan, and how much hot water your home requires.

We hope this article can help you decide which water heater is best for you. If you still need help deciding please do not hesitate to contact our qualified electrical and plumbing professionals.

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