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I recently had my 50 gallon traditional tank natural gas water heater fail on me. It cracked and flooded my garage. After the cleanup I called out my go to plumbing company to come give me an estimate for a replacement. I had heard about tankless water heaters and thought since the equipment was around the same price (within a few hundred dollars) that I should consider it so I don't have this happen again.

After he arrived I was given a quote of 1036 for a 50 gallon traditional tank natural gas water heater. I asked for the price of a tankless and it was ballpark 3k to 4500 for the equivalent tankless water heater. He didn't really explain why the price was so much more other than large amounts of work regarding an exhaust? Can anyone explain why the price was so much higher?

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  • I guess it takes a less powerful heater to slowly heat up 50 gallons of water over an hour or so than it does to instantly heat a continuous flow of water from say 5 C to 60 C at a high enough throughput to supply all hot-water taps full-on. Also there's no high-capacity reservoir to dump residual heat into when you turn the taps off. So perhaps more complex engineering.
    – RedGrittyBrick
    Dec 1, 2014 at 23:35
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    One other item is repiping the gas line. Generally tankless water heaters need larger pipe than standard water heaters because they need gas faster when they are burning.
    – OrganicLawnDIY
    Dec 1, 2014 at 23:37

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It's mostly the gas pipe. A tankless water heater is going to need a 1" or even 1.5" pipe to feed it. Your current water heater probably uses a 1/2" pipe. The new pipe probably needs to come off the main trunk, and replacing it requires a precise gas volume calculation and gas plumbing work that is very skilled labor and not cheap. If your plumber can't do this work himself, he's probably subbing it out and you're eating the cost.

Secondarily, there's also the re-plumbing of the water lines to feed the new heater. The inlet and outlet ports are probably in different places compared to where they are on your tank water heater. By contrast, if you replace it with another tank water heater, the water lines are already in the right place, and all you need to do is connect the tank with flex lines.

Finally, the exhaust may be different, too. Particularly if you go with a high-efficiency model, it can't be exhausted through the current pipe that's likely going through the roof.

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