An electric tankless water heater runs $886 to $996 for the unit alone and $1,642 to $1,925 once fully installed, typical around $1,784, per Homewyse's national estimate dated May 2026. That figure is priced on a 5.3 gallon-per-minute unit with a 35 degree F temperature rise. Installation labor runs close to the price of the unit itself.
Hot Water Brief is an independent cost-research site. We are not a contractor and do not perform the work ourselves.
That $1,642 to $1,925 range covers one specific configuration, not every electric tankless job. Homewyse's priced national job assumes three 40 amp 240 volt circuits are already available at the unit, and it explicitly excludes electrical system modifications, permit fees, and bringing existing wiring up to current code. Where those circuits do not already exist, expect the total to move above this range. The dedicated install cost guide covers panel capacity and circuit sizing in more depth than fits on this page.
| Item | Published range | Typical |
|---|---|---|
| Unit only | $886.17 to $996.24 | about $941 |
| Fully installed | $1,642 to $1,925 | about $1,784 |
Source: Homewyse, national estimate dated May 2026, priced on a 5.3 gpm unit at a 35 degree F rise with a 0.92 uniform energy factor.
Yes, on the sticker. Electric tankless installs for $1,642 to $1,925 against $3,293 to $3,859 for gas tankless, both per Homewyse, May 2026, a gap of roughly $1,800 at the midpoints. The difference sits almost entirely in the supporting work rather than the appliance itself.
Homewyse's priced gas tankless job includes a gas connection upgraded to 200,000 BTU and a vent ducting upgrade, both built into the $3,293 to $3,859 total. The priced electric tankless job needs no flue at all, but assumes three 40 amp 240 volt circuits are already at the unit. Gas tankless also costs more before installation: the unit alone runs $1,637.62 to $1,841.03, against $886.17 to $996.24 for electric, per the same Homewyse data.
| Fuel | Unit only | Fully installed | Typical installed |
|---|---|---|---|
| Electric tankless, 5.3 gpm | $886.17 to $996.24 | $1,642 to $1,925 | about $1,784 |
| Gas tankless, 8.5 gpm | $1,637.62 to $1,841.03 | $3,293 to $3,859 | about $3,576 |
Source: Homewyse electric tankless and Homewyse gas tankless, both national estimates dated May 2026.
Electric tankless units are sized by flow rate in gallons per minute, not tank gallons, and flow rate scales with kilowatts. Rheem's Professional Classic RTEX-24, for example, is rated at 24 kilowatts with a flow range of 2.4 to 4.3 gallons per minute, while the national installed price above is based on a larger 5.3 gallon-per-minute unit.
A bigger flow rate draws more current, and that draw is what determines whether an existing panel can handle the unit or needs an upgrade first. That circuit and panel sizing question is exactly what the install cost guide works through in detail; this page sticks to what the equipment and the finished job cost.
Homewyse's priced national installed job assumes three 40 amp 240 volt circuits are already available, which fits a whole-house unit more than a single point-of-use fixture. A smaller, single-fixture unit typically draws less current and costs less, though there is no equally dated national installed-price breakdown by flow rate to cite here.
Source: Rheem, Tankless Water Heaters, accessed August 2026. Homewyse, May 2026.
Not necessarily. Electric tankless carries a higher federal minimum efficiency rating, 0.91 to 0.92 uniform energy factor against 0.80 to 0.81 for gas, under 10 CFR 430.32(d). But nationally, electricity costs more per unit of delivered energy than piped gas: 18.44 cents per kilowatt-hour against $19.83 per thousand cubic feet, per the EIA, May 2026.
Efficiency rating and delivered fuel cost are two different questions, and a higher UEF does not by itself decide which unit costs less to run in a given home; local electricity and gas rates do that. ENERGY STAR publishes a specific running-cost saving for gas tankless: a certified unit saves a family of four about $95 a year against a gas storage tank, or about $1,800 over its 20 year life expectancy. There is no equivalent ENERGY STAR figure for electric tankless, because ENERGY STAR's water heater program does not include an electric tankless category at all. Its covered categories are high-efficiency gas storage, whole-home gas tankless, solar, and high-efficiency electric storage, not electric instantaneous units. That gap is a program design choice, not a statement about how efficient any specific electric tankless model is.
| Measure | Electric tankless | Gas tankless | Source, dated |
|---|---|---|---|
| Federal minimum uniform energy factor | 0.91 to 0.92 | 0.80 to 0.81 | 10 CFR 430.32(d), accessed August 2026 |
| National average fuel price | 18.44 cents per kWh | $19.83 per thousand cubic feet | EIA, May 2026 |
| ENERGY STAR running-cost saving vs. same-fuel storage tank, family of four | not published | $95 a year | ENERGY STAR |
Source: Cornell Law School Legal Information Institute, 10 CFR 430.32(d), eCFR mirror, accessed August 2026. EIA Electric Power Monthly, Table 5.6.A, May 2026. EIA residential natural gas price, May 2026. ENERGY STAR.
No. A standard electric tankless water heater is not on the IRS list of qualifying property for the Energy Efficient Home Improvement Credit. That credit covers gas, propane or oil water heaters up to $600, and electric or gas heat pump water heaters up to $2,000 a year, not electric resistance tankless units, per the IRS, updated April 28, 2026.
That distinction matters even if the credit were still open: heat pump water heaters qualify for up to $2,000 a year under Section 25C, but a resistance-heating electric tankless unit does not, because it is not a heat pump. The point may be moot regardless. The IRS states the credit applies only to property placed in service on or after January 1, 2023 and before December 31, 2025, so a 2026 installation does not qualify under any water heater category. Utility and municipal rebate programs are separate from this federal credit and are not covered by the figures above.
Source: Internal Revenue Service, Energy Efficient Home Improvement Credit, page last reviewed or updated April 28, 2026.
Closely, on price alone. Electric tankless installs for $1,642 to $1,925, close to the $1,586 to $1,843 it costs to replace a 40 gallon gas tank, both per Homewyse, May 2026. That is unusual for tankless: gas tankless runs roughly double a tank swap, while electric tankless does not, mainly because it needs no flue.
That closeness only holds under the same assumption used throughout this page: the priced electric tankless job assumes the electrical capacity, three 40 amp 240 volt circuits, already exists at the unit. Add a panel or circuit upgrade and the comparison changes. For the wider comparison across tank, tankless and heat pump water heaters together, including repair and maintenance pricing, see the full cost breakdown or the tankless water heater cost overview, which covers gas and electric tankless side by side against a conventional tank.
| Job | Published installed range | Typical |
|---|---|---|
| 40 gallon gas tank replacement | $1,586 to $1,843 | about $1,715 |
| Electric tankless, 5.3 gpm | $1,642 to $1,925 | about $1,784 |
| Gas tankless, 8.5 gpm | $3,293 to $3,859 | about $3,576 |
Source: Homewyse national cost calculators, May 2026.
Every figure on this page is listed here with its publisher and date.
Prices move. The dates above are the reason for citing them, so check them against the day you are reading this rather than assuming a May 2026 figure still holds.
$1,642 to $1,925 nationally, typical about $1,784, per Homewyse's estimate dated May 2026, priced on a 5.3 gallon-per-minute unit at a 35 degree F temperature rise. The unit alone runs $886 to $996; the rest is labor, mounting and electrical connection, assuming three 40 amp 240 volt circuits already exist at the unit.
Yes, on the published national figures: $1,642 to $1,925 installed for electric against $3,293 to $3,859 for gas, both per Homewyse, May 2026. The gap comes from the supporting work, gas needs a bigger fuel line and a vent upgrade, electric needs extra circuits but no flue, rather than the appliance itself.
It depends on how many fixtures run at once, and capacity is measured in gallons per minute, not tank gallons. Rheem's RTEX-24, for example, is rated at 24 kilowatts with a 2.4 to 4.3 gpm flow range, while the national installed price above is based on a larger 5.3 gpm unit. A bigger flow rate needs a bigger electrical circuit, covered in the dedicated install cost guide.
No. The IRS lists gas, propane or oil water heaters and electric or gas heat pump water heaters as qualifying property for the Energy Efficient Home Improvement Credit, not standard electric tankless units. The credit is also closed for new installations, since it required property placed in service before December 31, 2025.
Not necessarily. Electric tankless has a higher federal minimum efficiency rating, 0.91 to 0.92 UEF against 0.80 to 0.81 for gas, but electricity costs more nationally per unit of delivered energy than piped gas, 18.44 cents per kWh against $19.83 per thousand cubic feet, per the EIA, May 2026. Local utility rates for both fuels decide the actual bill.
Closely. Electric tankless installs for $1,642 to $1,925 against $1,586 to $1,843 for a 40 gallon gas tank swap, both per Homewyse, May 2026. That holds only if the electrical capacity for three 40 amp 240 volt circuits already exists; add a panel upgrade and electric tankless can cost more than a tank swap.
Independent Research
Published ranges for tank and tankless replacement, the failures that justify a repair, and the ones that do not. Sourced, dated, and free to read.
