What does a tankless water heater (electric) cost to run?

Run the numbers on your own use

Change any of these and the figures update. The defaults are the typical case described above; your rate is the input that moves the answer most.

Why this is lower than the number you will see elsewhere

Almost every published answer to this question multiplies the rating on the label by the hours the appliance is switched on. For a tankless water heater (electric) that gives 157,680 kWh a year, or $28,919.

An enormous rating for a very small share of the day. A whole-house electric tankless unit draws 18 kW or more while water is flowing and nothing at all when it is not, which is the whole point of it — there is no tank to keep warm between draws.

The arithmetic, step by step

Nothing here is hidden, so you can check it or change it. Working in the order the formula runs:

1. 18,000 W — what it draws while it is actually drawing. This is the rating on the plate.
2. × 2% — the share of its in-service time it is really pulling that. An enormous rating for a very small share of the day. A whole-house electric tankless unit draws 18 kW or more while water is flowing and nothing at all when it is not, which is the whole point of it — there is no tank to keep warm between draws.
   That gives 274 W averaged across the hours it is on.
3. × 24 hours a day × 365 days — The same household of three to four as the tank it would replace.
   274 × 24 × 365 ÷ 1,000 = 2,397 kWh a year.
4. × 18.34¢ — the US average residential rate for June 2026.
   2,397 kWh × 18.34¢ = $440 a year.

Change any assumption in the calculator above and every figure on this page moves with it. The two that matter most are your rate, which varies 4× across the country, and the hours — the duty cycle is a property of the appliance, but the hours are a property of you.

How sensitive is that number?

A single figure invites more confidence than it deserves. Here is the same appliance under assumptions either side of the default, so you can see how much of the answer is the appliance and how much is the guess about how you use it.

Everything else held at the default. The spread here is the honest error bar on the headline figure.

What it costs per hour, day and month

At 18.34¢ per kWh, the US residential average for June 2026.

What it emits

The same 2,397 kWh that costs $440 also emits about 1,946 lb of CO₂e a year on the average US grid — and that figure moves far more than the money does. On Vermont’s grid the same appliance emits 125 lb; on West Virginia’s it emits 4,719 lb. The full picture is here, including why an annual average cannot tell you whether running it at night is cleaner.

The thing worth knowing

Going tankless saves the standby loss and nothing else, because electric resistance heating is already 100% efficient and there is no headroom above that. Heating a given amount of water takes a fixed amount of energy whether it happens in a tank or in a pipe; the only waste a tank adds is keeping fifty gallons warm between draws, which is roughly a tenth of the total. Claims of 30% or 50% savings describe gas units, or a comparison against a very old tank, and do not transfer.

What it costs in your state

The appliance is the same everywhere; the rate is not. Running this tankless water heater (electric) costs $1,264 a year in Hawaii and $314 in Nevada — a difference of 4×.

Cost of running one tankless water heater (electric) for a year, by state. Residential average price, EIA June 2026.

Other water heating and pumps costs

• Hot tub

  $602 a year

  A 400-gallon tub held at 102F year round, well covered.

• Pool heat pump

  $576 a year

  Holding a residential pool at swimming temperature through an extended season.

• Electric water heater

  $499 a year

  A 50-gallon tank serving a household of three to four.

• Pool pump

  $396 a year

  A single-speed pump on an eight-hour timer through the season.

• Koi pond pump

  $241 a year

  A pump circulating a mid-size koi pond through its filter, year round.

• Heat pump water heater

  $177 a year

  A 50-gallon hybrid in a basement, resistance backup rarely engaged.

Questions

Source: U.S. Energy Information Administration, Electric Power Monthly, Table 5.6.A, June 2026. U.S. Government work, public domain.

How every figure on this page is computed · Where the data comes from