When it comes time to replace or upgrade your water heater, there’s a lot to consider. Homeowners today are looking for options that are cost-effective, energy-efficient, and able to keep up with the demands of modern life. Tankless water heaters have quickly become a popular choice — but the next big question when it comes to a tankless water heater: gas vs electric?
Both electric tankless water heaters and gas tankless water heaters come with their own benefits and drawbacks. Understanding the differences in performance, costs, energy usage, and installation needs can help you make the right decision for your home.
In this guide, we’ll break it all down simply — no plumbing experience required!
What Is a Tankless Water Heater?
Unlike traditional storage water heaters, a tankless water heater heats water only when you need it. Instead of storing gallons of water in a big tank and keeping it hot all the time, tankless systems instantly heat water as it flows through the unit.
The result?
- Endless hot water supply
- No standby energy loss
- A much smaller footprint — tankless units mount neatly on a wall
Tankless water heaters generally offer longer lifespans, better energy efficiency, and more flexibility in installation than older tank models.
Overview: Electric vs Gas Tankless Water Heaters
Both electric tankless water heaters and gas tankless water heaters have the same basic goal: deliver hot water on demand without the need for a storage tank. But they differ in a few important ways:
Energy Sources:
Electric models plug into your home’s electrical system.
Gas models use natural gas or propane and need a gas connection.
Home Size/Needs:
Electric tankless water heaters are great for smaller homes or supplemental use.
Gas tankless water heaters are better suited for larger households with higher water demands.
Installation Complexity:
Gas units often need special gas lines and venting.
Electric models are simpler to install in many homes.
Understanding these basics helps you see which system might fit your needs best — but let’s go deeper.
Initial Cost and Installation Considerations
Initial cost is one of the biggest factors homeowners consider when deciding between a gas or electric tankless water heater. Typically, electric tankless water heaters are less expensive to purchase and install. Installation is often simpler because electric models don’t require venting or new gas lines.
If your home already has the necessary electrical capacity, adding an electric unit can be very straightforward and cost-effective. In contrast, gas tankless water heaters usually cost more upfront and can require more extensive installation work.
Adding venting systems, adjusting gas piping, or even installing a new natural gas or propane line if one isn’t already available can significantly increase the initial cost. It’s also important to factor in local labor rates, permit fees, and any necessary system upgrades when budgeting for a gas unit.
When looking at tankless water heaters cost, electric models are generally cheaper and easier to install — but installation is just one piece of the overall decision. Other factors, like energy efficiency and long-term operational costs, also play a big role in determining which option is truly the best fit for your home.
Energy Efficiency and Operational Costs
After installation, the next major factor is operational costs and energy efficiency over the life of your water heater.
Electric Tankless Water Heaters:
- Typically more energy efficient because they convert nearly 100% of their energy into heat.
- No venting losses (like gas units have).
- However, energy costs for electricity can be higher in some areas compared to natural gas.
Gas Tankless Water Heaters:
- Slightly less efficient overall, but natural gas is often a cheaper energy source than electricity.
- Newer gas models are highly efficient, especially condensing units, but still lose some energy through venting.
Key takeaway
Electric models win for pure energy conversion efficiency, but gas models can be more cost effective depending on local utility rates.
If you want maximum energy efficiency, electric tankless water heaters might be the right choice. But if your home already runs on affordable natural gas or propane, a gas unit could save you more in the long run.
Water Flow and Performance
One area where gas tankless water heaters tend to outperform electric is in water flow and overall performance.
One area where gas tankless water heaters tend to outperform electric models is in water flow and overall performance. Gas units offer a higher flow rate, meaning they can support multiple appliances — like showers, dishwashers, and washing machines — running at the same time without a drop in hot water availability.
This makes gas models a great choice for larger households that often have simultaneous demands for hot water. On the other hand, electric tankless water heaters typically have lower flow rates. They are best suited for smaller households or for point-of-use applications, such as supplying hot water to a single bathroom or an outbuilding.
In colder climates where incoming water temperatures are very low, electric models may also struggle to heat water quickly enough to meet high demands.
If you have a busy home where multiple people need hot water at once, gas tankless water heaters generally handle higher demand better and may provide a more consistent experience.
In the along Run, Which Is the More Cost Effective Tankless Water Heater: Gas vs Electric
When looking at long-term value, homeowners should consider both initial cost and operational costs:
Electric Tankless Water Heater:
- Lower upfront cost
- Lower maintenance needs (no combustion = no vent cleaning)
- Possibly higher energy costs over time if electricity rates are high
- Best value for homes with modest hot water needs
Gas Tankless Water Heater:
- Higher upfront investment
- Higher maintenance needs (venting, annual descaling)
- Typically lower operational costs if natural gas or propane is cheap
- Best for larger households with higher water flow needs
Tankless water heaters generally last 20+ years with good maintenance, making them a smart long-term investment regardless of energy source.
Choosing the right one depends heavily on your home’s energy sources, your typical hot water usage, and your future plans for the home.
Both tankless electric water heaters and gas tankless water heaters offer fantastic benefits compared to traditional tank systems. The right choice for you depends on your home’s existing setup, the availability of natural gas or propane, your budget, and your hot water needs.
Need a quick, affordable install for a small home? An electric tankless water heater might be perfect. Want maximum performance for a big household? A gas tankless water heater could be worth the extra investment.
Not sure which way to go? Consulting a trusted professional like Meticulous Plumbing is the best way to weigh your options and find the system that fits your home and lifestyle perfectly.
Tankless Water Heater: Gas vs Electric FAQs
- Are electric tankless water heaters cheaper to run than gas models?
It depends on your local utility rates. Electricity is usually more expensive than natural gas or propane, but electric models are more efficient at converting energy into heat. Depending on your rates, electric could still be cost effective.
- How do I know if my home is better suited for gas or electric?
If your home already has a gas line installed and accessible, a gas model might make sense. If not, or if electrical upgrades are simpler and cheaper, an electric model could be the better choice.
- Does a tankless water heater require special maintenance?
Yes. Both gas and electric units should be descaled annually if you have hard water. Gas units may also need vent system inspections to ensure safe operation.
- What size tankless water heater do I need for my home?
It depends on your household’s peak water flow demand. Homes with multiple bathrooms and simultaneous hot water needs generally require units with a higher flow rate, often making gas tankless water heaters the better fit.
- How long do tankless water heaters generally last?
With proper maintenance, both gas and electric tankless water heaters can last 20 years or longer — much longer than a traditional storage tank water heater.
Contact Meticulous Plumbing for Tankless Water Heater Solutions
Choosing between an electric or gas tankless water heater doesn’t have to be stressful.
At Meticulous Plumbing, we specialize in helping homeowners find the perfect water heating solution — and installing it with clean, professional craftsmanship you can trust.
Whether you’re focused on energy efficiency, maximizing hot water flow, or keeping operational costs low, we’ll walk you through your options and provide expert recommendations tailored to your home.
Contact Meticulous Plumbing today for a free consultation and take the first step toward endless hot water — the smart, energy-efficient way!
