Wondering about electric vs gas tankless water heater? When choosing between an electric and gas tankless water heater, the decision hinges on energy efficiency, installation requirements, operating costs, and your home’s existing infrastructure. Electric models are generally easier to install and more energy-efficient in mild climates, while gas units excel in delivering higher flow rates for larger households. This guide will unpack every detail you need to make an informed choice, from upfront costs to long-term environmental impact.
What Are Tankless Water Heaters?
Tankless water heaters, also called “on-demand” systems, heat water directly without storing it in a tank. When you turn on the hot water tap, cold water travels through a heat exchanger, where it’s instantly warmed by either an electric element or gas burner.
How Tankless Systems Work
Electric models use coiled heating elements similar to those in kettles, while gas units ignite a burner to create heat. Gas systems require venting to expel combustion gases, whereas electric models don’t.
For detailed guide about how tankless water heater work read our blog.
Electric vs Gas Tankless Water Heaters: Key Differences
1. Energy Efficiency
Electric tankless heaters convert 98–99% of energy into heat, compared to 80–85% for gas models. However, gas units often cost less to operate in regions with low natural gas prices.
Example:
A household using 40 gallons of hot water daily pays $150/year for electric vs $115 for gas in areas with $0.12/kWh electricity and $1.20/therm gas.
2. Flow Rate and Performance
Gas models outperform electric ones in simultaneous use cases:
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Gas: 5–7 gallons per minute (GPM)
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Electric: 2–5 GPM
A gas unit can handle a shower and dishwasher running together, while an electric system may struggle.
3. Installation Complexity
| Factor | Electric | Gas |
|---|---|---|
| Venting Required | No | Yes |
| Electrical Upgrade | 240V | N/A |
| Gas Line Requirement | No | Yes |
Electric models cost $500–$1,500 to install vs $1,200–$3,000 for gas.
Cost of Electric vs Gas Water Heaters
Upfront Costs
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Electric: $500–$1,200
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Gas: $800–$1,800
Operating Costs (Annual)
| Region | Electric | Gas |
|---|---|---|
| Northeast U.S. | $220 | $160 |
| Southern U.S. | $180 | $135 |
Environmental Impact
Electric models produce zero direct emissions, making them cleaner in areas with renewable energy grids. Gas units emit 45–55 kg of CO₂ annually for an average household.
Choosing Between Gas or Electric Water Heaters
Best For Electric:
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Small households (1–3 people)
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Mild climates
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Homes without gas lines
Best For Gas:
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Large families
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Cold climates
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Existing gas infrastructure
Not sure what size unit fits your needs? Check out our detailed guide on what size of tankless water heater do I need to make the right choice for your home.
Wondering about the lifespan of your unit? Learn more in our full guide on how long does a tankless water heater last and find out when it might be time for a replacement.
Expert Tankless Water Heater Installation in Los Angeles
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Conclusion
Gas or Electric water heater? For most households, gas tankless water heaters provide better performance for multi-fixture use, while electric models shine in efficiency and ease of installation. Consider your local energy costs, climate, and usage patterns before deciding. Newer hybrid systems combining both energy sources are also emerging as versatile options.
FAQs
Do tankless water heaters use gas or electricity?
Both types exist! Electric models use heating coils, while gas units burn natural gas or propane.
Are all tankless water heaters gas?
No 33% of U.S. tankless installations are electric, particularly in warmer states.
Will switching to a tankless water heater reduce my utility bills?
Most homeowners see noticeable savings over time due to higher energy efficiency, especially if you have a household with moderate to low hot water demand.
Are there any drawbacks to tankless water heaters?
The main drawbacks are higher upfront costs and potential installation complexity, especially for gas units needing venting and gas line upgrades. Also, electric models may struggle with high simultaneous demand.
What is the cold water sandwich effect in tankless water heaters?
It’s a brief burst of cold water that can occur between hot water uses. Some premium models include buffer tanks or recirculation pumps to eliminate this effect.
