Tankless Water Heater Costs and Everything to Consider Before You Install Yours

Tankless water heaters have become more popular in recent years, and for good reason. They have a number of benefits over traditional tank water heaters, including:

– They take up less space

– They last longer

– They’re more energy efficient

However, there is one major downside to tankless water heaters – they cost more to install. This is because a tankless water heater requires specialized equipment, such as a gas line or a dedicated circuit breaker. Additionally, the installation process is more complex and time-consuming. As a result, a tankless water heater typically costs $500-1,000 more to install than a traditional tank water heater.

When deciding to purchase a new hot water heater there are several factors to consider. First, you need to choose between a standard tank water heater and a tankless water heater. Both water heaters carry pros and cons but the cost to run your water heater will probably help in making the wisest decision.

How a Tankless Water Heater Works

A standard water heater holds a certain number of gallons of water for your home usage. When hot water is called for by turning on a faucet or running your washing machine, for example, the hot water stored in the tank is released and runs through your home’s pipes to the source calling for water. At the same time, cold water enters the bottom of the storage tank and is heated either by an electric element or a gas burner. When water is not being called for the hot water tank continues to work to keep the full tank of water hot which results in energy being expended and potentially wasted if not used. 

A tankless system is different. A tankless water heater heats water on demand. What that means is as a faucet, washing machine or other appliance calls for hot water, the tankless unit allows cold water to flow through a heat exchanger and heats the water. The hot water is then supplied to the source. This process occurs without a storage tank. 

Purchase, Installation, and Running Costs

Standard tank water heaters are relatively inexpensive to purchase ranging from $500-to $900. A tankless system is much more costly with a purchase range of between $2000 and $4500. Installation costs vary as well. Standard tank storage, on average, runs about $450 for installation. A tankless system can cost as high as $1500. These costs must be considered when choosing a water heater. However, the cost to run these systems may also influence which type you purchase. Because a tank system is continuously heating water whether the water is being called for or not the energy used is greater. A standard 40-gallon hot water heater can cost anywhere between $200-$800 a year depending on the unit’s efficiency. A tankless system will cost less than $100 annually. As you can see, the higher initial costs and higher installation costs can quickly be recouped in a short amount of time.

In Conclusion

Regardless of whether you are replacing or purchasing a new hot water heater, the associated costs will play a major part in your choice. Tankless systems are more costly upfront but can save you money over the long run compared to standard tank systems. Doing your homework before purchasing a system can match your needs with the best unit available saving you energy and money. Want to get the best price on a tankless water heater installation in Orange County? Contact us today!