Analysis of the energy savings between a conventional tank water heater vs. a tankless water heater

This comparison is based on the following variables:

Tankless variables

  • Shower time period in minutes: 10
  • Shower head flow rate in gallons per minute (“GPM”): 2.0
  • Outgoing water temperature at the shower head in degrees Farenheit: 105
  • Municipal water inlet temperature in degrees Farenheit: 55

Tank variables

  • Tank thermostat setting in degrees Farenheit: 125
  • Two heating elements rated each at 240 volts and 4500 watts. Most conventional tank heaters have these specs. Typically, only one of the two heating elements consume energy simultaneously to heat the water in the storage tank.
  • All the water stored already heated to 125°F. This way, when one starts the shower, it will reflect a true consumption for those 10 minutes of hot water usage.


At the time when a person starts the shower, no energy is used. After three minutes of shower operation, then the tank heater starts to consume energy. One 4500 watt element turns on and draws power. A 240 volt heating element heating the water is consuming approximately 19 amps and producing 4,500 watts of energy.

After 10 minutes the shower is turned off. The tank heater continues to draw 19 amps of electricity. Forty-five minutes after the shower is finished, the water temperature inside the tank heater returns its original temperature of 125°F.

Remember that the tank started to consume energy after three minutes of the 10 minute shower, and then continued using energy for another 45 minutes after the 10 minute shower was completed. So, the total energy consumption for this 10 minute shower was 52 minutes. Yes: 52 minutes of energy use or draw for a 10 minute shower!

Conventional hot water tank usage cost calculation

1. Take the wattage used (4500) and divide by 60 minutes to determine the minute wattage cost: 4500/60 = 75. Therefore, 75 is the watts used per minute.
2. Multiply 75 by the time (52 minutes) of energy consumption: 52 x 75 watts per minute = 3900 total watt consumption. In other words, a 10 minute shower uses 3900 watts of energy.
3. Your electric power company probably bills you in kilowatt-hours (“kWh”). 3900 watts equals 3.9 kWh. Let’s say your rate is .12 cents per kWh.
4. The 10 minute shower costs $0.47 cents (3.9 x .12 = .468).

Tankless hot water heater usage cost calculation

Now let’s take the same scenario and compare it with a tankless water heater. It’s simple: The tankless hot water heater only consumes energy when hot water is running out of a point of use (like a shower). Therefore, it will consume only the energy it needs to heat the water. Further, the energy used to heat the water is more than 99% efficient.

With tankless, the same 10 minute shower, it will consume energy only for the 10 minutes the hot water is used. With the tankless output temperature set at 105°F, it only draws the required power to raise the inlet temperature of 72°F to 105°F, nothing more. Given the above, at a flow rate of 2 GPM, the power draw is 14,700 watts but for only 10 minutes, yes more energy than the tank heater, but let’s do the math as before … 14,700 watts divided by 60 minutes = 245 watts x 10 minutes =2450 watts total usage or 2.45KWH, in this same 10 minute shower the tankless had a total energy usage of 2450, (1450 LESS WATTS than the Tank Heater) now what does this represent in cost (1450 watts = 1.4 KWH x .12 cents = .168 cents , your cost)

What are the savings tankless vs TANK- cost for 10 minute shower = .29 cents
TANK cost for 10 minute shower = .47 cents
SAVING = .18 cents on this one ten minute shower.

Now do the math – A family of 4 taking 1 shower daily (tank cost .47 cents x 4 = $1.88) The same family with tankless ( .29 cents x 4 = $1.16) YOUR DAILY SAVINGS $.72 cents x 365 days = $263.80 in yearly savings on just your shower demand. On your total hot water usage demand the savings can be as high as 60% off your hot water heating bills which means you can get your investment or cost of our units back in under 18 months.

Here is an online store where you can buy a wide selection of tankless water heaters.

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