Tankless Water Heater Propane Usage
About the Tankless Water Heater
A tankless or on-demand propane water heater provides continuous hot water without storing a tank of preheated water. When a hot water tap opens, a flow sensor activates the burner, which heats water as it passes through the heat exchanger. The high BTU rating of 199,000 allows the unit to heat water to the desired temperature at flow rates of 5-9 gallons per minute, sufficient for two simultaneous showers in most climates. Despite the high BTU rating, the actual daily burner time averages only about 30 minutes because the unit fires only when hot water is actively being used. This on-demand operation eliminates standby heat loss, the energy wasted keeping a tank of water hot 24 hours a day. Tankless water heaters typically reduce propane usage for water heating by 20-30% compared to traditional tank models, and they last 20 or more years compared to 10-15 years for tank-style heaters.
Annual Propane Consumption Breakdown
The tankless water heater consumes propane at a rate of 2.17 gallons per hour at its rated capacity of 199,000 BTU per hour (based on the standard energy content of 91,500 BTU per gallon of propane). Running for approximately 0.5 hours per day over 12 months per year, the total annual consumption is approximately 397.2 gal.
At the national average propane price of $2.50 per gallon, this translates to an annual fuel cost of $993.04, or an average of $82.75 per month. Since the tankless water heater is not a heating appliance, monthly costs remain relatively consistent throughout the year at approximately $82.75 per month during active use.
The 250-gallon tank is recommended for homes using only the tankless water heater on propane, requiring approximately 2 fills per year. If you have additional propane appliances, calculate your total consumption using our propane usage calculator to determine the appropriate tank size for your combined needs.
Tankless Water Heater Cost Across Different States
The table below shows how propane costs for the tankless water heater vary across representative states. Differences primarily reflect local propane pricing, since non-heating appliance usage is consistent across climates.
| State | HDD | Price/Gal | Gal/Year | Cost/Year |
|---|---|---|---|---|
| Minnesota | 7,981 | $1.85 | 397.2 gal | $734.85 |
| New York | 5,882 | $3.40 | 397.2 gal | $1,350.54 |
| Virginia | 3,960 | $2.75 | 397.2 gal | $1,092.35 |
| Texas | 1,711 | $2.30 | 397.2 gal | $913.60 |
| Florida | 683 | $2.95 | 397.2 gal | $1,171.79 |
| Colorado | 6,128 | $2.55 | 397.2 gal | $1,012.90 |
| California | 2,870 | $3.20 | 397.2 gal | $1,271.09 |
| Ohio | 5,641 | $2.35 | 397.2 gal | $933.46 |
Efficiency Tips for Your Tankless Water Heater
Getting the most efficiency from your tankless water heater involves proper usage habits and regular maintenance. Ensure the unit is operating at its designed specifications by having it professionally inspected annually. Check gas connections for leaks using a soap and water solution on all fittings. Clean burner ports and orifices to maintain proper flame patterns and complete combustion. An improperly adjusted burner wastes propane and can produce dangerous carbon monoxide.
Usage optimization is the primary way to reduce propane consumption for non-heating appliances. For water heaters, lowering the thermostat to 120 degrees saves 6-10% on water heating costs. Installing low-flow showerheads and faucet aerators reduces hot water demand by up to 25%. For cooking appliances, matching pot size to burner size, using lids to retain heat, and preheating only when necessary all reduce propane consumption while producing the same results.
If your tankless water heater is more than 10-15 years old, consider replacing it with a newer, higher-efficiency model. Modern propane appliances are significantly more efficient than older designs, and the propane savings can offset the purchase price within a few years. Look for Energy Star certified models that meet or exceed the highest efficiency standards in their category.
Tankless Water Heater Compared to Similar Appliances
The following table compares the tankless water heater to other appliances in the water heating category by BTU rating and annual propane consumption.
| Appliance | BTU/hr | Hrs/Day | Gal/Year | Cost/Year |
|---|---|---|---|---|
| Tankless Water Heater (this appliance) | 199,000 | 0.5 | 397.2 gal | $993.04 |
| Water Heater 40 Gallon | 40,000 | 1.5 | 239.5 gal | $598.82 |
Frequently Asked Questions
How many gallons of propane does a tankless water heater use per year?
A tankless water heater rated at 199,000 BTU per hour, running approximately 0.5 hours per day for 12 months per year, uses approximately 397.2 gal of propane per year at the national average. This estimate is relatively consistent across states since usage does not depend heavily on climate. At the national average price of $2.50 per gallon, the annual cost is approximately $993.04.
How much does it cost to run a tankless water heater on propane?
At the national average propane price of $2.50 per gallon, a tankless water heater costs approximately $993.04 per year, or $82.75 per month averaged across the year. The monthly cost varies seasonally, with relatively consistent costs throughout the year. Your actual cost depends on your state's propane price and your specific usage patterns.
What size propane tank do I need for a tankless water heater?
For a tankless water heater as your only propane appliance, a 250-gallon tank is recommended. This provides adequate capacity for approximately 6 months between fills. If you have multiple propane appliances, you will need to account for the combined consumption of all appliances when choosing a tank size. Most homes with a furnace plus other propane appliances need a 500-gallon or 1,000-gallon tank.