When it’s time to upgrade or replace your water heater, tankless models are a popular, energy-efficient option. But once you decide to go tankless, the next big question is: electric or gas?
Both electric and gas tankless water heaters can provide endless hot water while saving space and reducing standby energy loss. However, they operate differently and have their own pros and cons depending on your home, budget, and usage habits.
Let’s take a look at how each system works and break down the key factors to help you decide which option is right for you.
How Do Electric & Gas Tankless Heaters Work
As their names suggest, the biggest difference between these water heaters is how they heat up the water.
Electric tankless water heaters use high-powered electric heating elements to instantly heat water as it flows through the unit. When you turn on a hot water tap, cold water travels through the system where it’s heated on demand.
Meanwhile, gas tankless water heaters use a gas burner (usually natural gas or propane) to rapidly heat water as it flows through the system. These units often require venting to release exhaust gases safely outside the home.
Things to Consider When Deciding Between Electric vs Gas Tankless Water Heaters
Along with how they generally work, there are a few differences between electric and gas tankless water heaters that you need to consider in order to find the best fit for your home.
Utility Access
One of the first things to consider is what utilities are available in your home and where you can access them. Electric tankless water heaters require ready access to electrical power. If your home doesn’t have the proper amperage or electrical panel capacity, you may need to upgrade your system. However, if you don’t have access to natural gas or propane, electric is often the most practical (and sometimes only) option.
On the other hand, if your home already has a natural gas line in place, installing a gas tankless water heater could be a straightforward process. Homes in rural areas that rely on propane tanks may also lean toward gas models if electricity is expensive or unreliable.
Installation
Installation requirements can vary widely between electric and gas tankless water heaters. Electric units are generally easier and less expensive to install. They don’t require venting and are compact enough to be installed in tight spaces like under sinks, in closets, or on walls.
In contrast, gas units require proper ventilation to expel combustion gases safely. This often means cutting through walls or ceilings to install vent pipes, which can increase installation time and cost. Preexisting ventilation is oftentimes not enough given how involved a gas tankless water heater can be. If minimizing installation hassle is a top priority, electric may be the better route.
Costs
Upfront unit and installation costs are typically lower for electric tankless water heaters. The units themselves tend to be less expensive, and the simplified installation process keeps labor costs down. However, long-term operating costs can vary based on your local utility rates.
Gas tankless systems cost more to purchase and install because of their complexity, but they may offer lower energy bills over the long run. It’s important to weigh both the initial investment and ongoing energy expenses when deciding which option offers the best value for your home.
Energy Efficiency
If energy efficiency is a major factor in your decision, electric tankless water heaters usually have the edge. According to the U.S. Department of Energy, electric tankless water heaters are 24-34% more energy efficient than their traditional counterparts. They also don’t lose energy through venting or pilot lights.
Gas units, while still efficient compared to traditional tank heaters, typically have slightly lower efficiency ratings. That said, condensing gas models are available and offer improved efficiency by reusing exhaust heat. However, these models tend to be more expensive.
Water Usage
Your household’s water usage plays a big role in determining which type of tankless water heater is best. Electric models often have lower flow rates and may struggle to supply enough hot water when multiple fixtures are in use at the same time. If you have a large household or are constantly pulling on your water heater, you can get a larger unit with a larger flow rate.
Gas tankless heaters, on the other hand, can generally provide higher flow rates and are better suited for larger families or homes with multiple bathrooms.
Which is best for you?
Again, deciding between an electric vs gas tankless water heater completely depends on the unique features and needs of your home.
If your home is already set up with access to a gas line and you can afford the heavier installation and maintenance costs of a unit, a gas heater can deliver the higher flow rates you need while potentially lowering your energy bills over time.
But if you’re looking for a straightforward, budget‑friendly installation that provides energy-efficient heating, an electric model is often the smartest choice, especially if your household’s hot water usage is moderate and you’d rather avoid the complexity of venting.
Of course, every home is different, so if you’re still weighing your options, a licensed plumbing professional can evaluate your electrical capacity, gas hookups, and overall usage to recommend the perfect tankless system for your lifestyle and budget.
At Ciriello Plumbing, we promise expertise, honesty, and efficiency to the homes and businesses we service in Greater Indianapolis, including Carmel, Fishers, & Greenwood. From residential plumbing repairs to commercial installations, our expert team is dedicated to providing exceptional craftsmanship and unparalleled customer service. For reliable plumbing services you can trust, contact Ciriello Plumbing Solutions today.
