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How Much Does It Cost to Run a Tankless Water Heater? $32/Month

Running a tankless water heater at 18,000 watts for 0.35 hours a day costs about $1.07 a day and $32.13 a month at 17¢/kWh, the EIA 2025 annual US average (July 2026 monthly: 18.31¢) — roughly $391 a year.

18,000 W (8,000–36,000 W)Typical power draw
0.35 h/day, 30 days/monthAssumed use
6.30 kWhEnergy per day

· Source: EIA Electric Power Monthly Table 5.6.A (July 2026 data) · next EIA update ~Oct 23

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a tankless water heater: energy cost only (18,000 W ÷ 1,000 × hours × rate); fixed fees and taxes extra.
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## How much does it cost to run a tankless water heater?

The same a tankless water heater at 0.35 hours a day costs $22.68 a month at 12¢ and $85.05 at 45¢ — usage held constant, only the rate moving:

Table 1: How Much Does It Cost to Run a Tankless Water Heater? $32/Month
Electricity rate Per hour Per day Per month Per year
12¢/kWh $2.160 $0.76 $22.68 $276
15¢/kWh $2.700 $0.94 $28.35 $345
17¢/kWh (US avg) $3.060 $1.07 $32.13 $391
20¢/kWh $3.600 $1.26 $37.80 $460
25¢/kWh $4.500 $1.57 $47.25 $575
30¢/kWh $5.400 $1.89 $56.70 $690
35¢/kWh $6.300 $2.21 $66.15 $805
45¢/kWh $8.100 $2.83 $85.05 $1,035
Typical power draw
18,000 W (8,000–36,000 W)
Assumed use
0.35 h/day, 30 days/month
Energy per day
6.30 kWh
Cost per day
$1.07
Cost per month
$32.13
Cost per year
$391

Why this number

Running a tankless water heater at 18,000 watts for 0.35 hours a day costs about $1.07 a day and $32.13 a month at 17¢/kWh, the EIA 2025 annual US average (July 2026 monthly: 18.31¢) — roughly $391 a year. The formula for a tankless water heater: 18,000 W ÷ 1,000 × hours × your rate per kWh. For a tankless water heater your own rate changes the answer: at 12¢/kWh that month costs $22.68, at 45¢/kWh it costs $85.05.

A tankless water heater rated at 18,000 watts, run 0.35 hours a day, costs about $1.07 a day — about $32.13 a month, or $391 a year — at the US average electricity rate of 17¢/kWh. That places it 7th of the 40 appliances tracked here — in the top quarter, well above the typical household load, so how much you run it genuinely shows on the bill.

What actually drives this number

An electric tankless heater draws more power than anything else in the house — 18 to 36 kW, enough to need two or three dedicated 40-amp circuits and often a service upgrade — but only while water is actually moving through it, which is about twenty minutes a day for a typical household. Enormous demand, tiny duty cycle. What going tankless removes is standby loss, not the cost of heating the water itself, so the saving against a tank is real but modest: EIA’s 2020 data puts electric tankless households at about 2,270 kWh a year against 2,940 kWh for a large electric tank. If you want a big cut in water heating, a heat pump water heater is the appliance that delivers it; tankless mainly buys you unlimited hot water and a smaller closet.

At 18,000 W every hour of this load costs about $3.06 and no more efficient unit exists to buy — resistance heat is resistance heat. The same physics is why, at whole-house scale, the real decisions are between technologies rather than models: the heat pump vs gas furnace running-cost comparison works out when moving heat beats making it, and the winter heating fuel comparison prices electric resistance against gas, propane and oil per unit of heat actually delivered.

Where this number comes from

Putting Tankless water heater in proportion

At 17¢/kWh, a tankless water heater next to the rest of the bill:

For a tankless water heater: making heat is where household electricity goes, but how it is made decides the bill. A resistance element — an oven, a dryer, a resistance furnace, a kettle — converts every watt into exactly one watt of heat, so a cheap appliance and an expensive one with the same rating cost the same to run and efficiency is not something you can shop for. Equipment that moves heat instead of making it, like a heat pump, delivers several units of heat per unit of electricity and breaks that rule entirely. The only levers on a resistance load are running it less, running it lower, or heating a smaller space. On this site’s own numbers, a tankless water heater lands at #7 of 40 on the monthly-cost ranking, at about $32.13 for a typical month.

The formula, in full

The 18,000 W arithmetic for a tankless water heater, step by step:

  1. Watts to kilowatts. 18,000 W ÷ 1,000 = 18.00 kW.
  2. Energy per day. 18.00 kW × 0.35 hours = 6.30 kWh.
  3. Cost per day. 6.30 kWh × $0.17 = $1.07.
  4. Cost per month. $1.07 × 30 days = $32.13.

For a tankless water heater the two levers are run-hours (0.35 h/day here) and your rate; used this briefly, even 18,000 W costs little — which is why anything that makes heat dominate the rankings.

Other heating loads: Electric water heater ($475/yr), Hot tub ($512/yr), 240V garage heater ($255/yr). Closest on annual cost: Central air conditioner ($339/yr), Ductless mini-split ($479/yr). Across all other heating loads here, the cheapest is Air fryer at $1.33/mo and the priciest is Electric furnace at $119.34/mo.

The a tankless water heater table above runs a fixed rate ladder (12–45¢); the state quick-fill uses July 2026 averages from EIA Electric Power Monthly, Table 5.6.A .

Put a tankless water heater ($32.13 a month) against everything else in the electricity cost calculator , check your state’s rate , or browse all 40 appliances ; year-round high bills: solar savings calculator .

Frequently asked questions

How much does it cost to run a tankless water heater per hour?

About $3.060 an hour for a tankless water heater at 17¢/kWh, the EIA 2025 annual US average (July 2026 monthly: 18.31¢), for a 18,000 W unit. The calculation is 18,000 ÷ 1,000 × 1 hour × $0.17 per kWh. At 30¢/kWh the same hour costs $5.400.

How much does a tankless water heater add to my monthly bill?

Roughly $32.13 a month for a tankless water heater at 0.35 hours a day, 30 days a month, 17¢/kWh. That is about $391 a year if you use it that much year-round. For a tankless water heater, change the 0.35-hour default to your own use — run-time moves the total as much as the 18,000 W does.

How many watts does a tankless water heater use?

Typically around 18,000 W, with real units ranging from about 8,000 to 36,000 W depending on size, model and setting. The nameplate on your own unit is the figure to trust — these are typical values for planning, not a measurement of your appliance.

Why is my actual bill higher than the a tankless water heater figure?

$32.13 a month is the energy cost of a tankless water heater alone; your bill adds fixed connection charges, delivery fees, taxes and every other load. Add the other appliances in the index to a tankless water heater for the controllable part of the bill.

How we calculated this

Worked for a tankless water heater: 18,000 W ÷ 1,000 × 0.35 h × $0.17 = $1.07 a day; × 30 days = $32.13 a month; × 12 months in use = $391 a year. 18,000 W and 0.35 h are the typical figures cited for a tankless water heater; 17¢ is EIA’s 2025 annual US average.

Sources: U.S. Energy Information Administration (EIA) electricity rates · DSIRE incentive records · public IRS/OBBBA guidance. Figures are modeled estimates, not quotes or tax advice. See our methodology.

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