How Much is a Tankless Water Heater in 2025?

Tankless

Thinking about a tankless water heater in 2025? Learn what impacts the cost, average installation prices, and how energy savings make it a smart investment.

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Posted by Ryan | September 3, 2025

More and more homeowners are turning to tankless water heaters as a modern, energy-efficient upgrade from traditional tank models. With their ability to provide endless hot water, reduce energy bills, and save valuable space, they’ve become one of the most sought-after home comfort solutions in 2025.

But how much does a tankless water heater actually cost this year? In this guide, we’ll break down the factors that affect pricing, the average installation costs, long-term savings, and what you can expect when choosing Action Furnace for your installation.

What is a Tankless Water Heater?

Unlike traditional water heaters that store and continuously heat a large tank of water, tankless systems heat water on demand. This means you only pay to heat the water you use, when you use it.

Key benefits of a tankless water heater include:

Energy efficiency – no standby energy losses from keeping water hot 24/7.
Endless hot water supply – never worry about the last shower running cold.
Space-saving design – wall-mounted units free up storage space.
Longer lifespan – often lasting more than 20 years.

With these advantages, it’s no surprise that tankless systems are becoming a top choice for Alberta homeowners in 2025.

Factors That Affect the Cost of a Tankless Water Heater in 2025

The total cost of purchasing and installing a tankless water heater depends on several variables:

Brand and Model – Premium brands come at a higher price but often offer superior reliability and warranties.
Type of Fuel – Natural gas and electric units each have different price points and installation requirements.
Size and Capacity – Larger households with higher hot water demands will require higher-capacity models.
Advanced Features – Options like Wi-Fi compatibility, smart home integration, and ultra-high efficiency ratings can increase upfront costs, but add convenience and savings over time.

Average Cost of a Tankless Water Heater in 2025

In Alberta, the average cost of an installed electric tankless water heater in 2025 typically starts at $5,500-$7,500 and goes up from there depending on the model and features.

While the upfront investment is higher than traditional tank models, the efficiency and longevity of tankless systems make them more cost-effective over time.

Unsure of what you need? A detailed cost comparison of the top three equipment options can be provided by your Comfort Advisor during a consultation.

Energy Savings and Long-Term Cost Benefits

One of the biggest advantages of a tankless water heater is the long-term savings it provides. On average, tankless models are 20–30% more energy-efficient than traditional water heaters. This translates to lower monthly utility bills, especially for larger households with consistent hot water needs.

And with proper maintenance, tankless water heaters often last 20+ years, compared to the 10–12 year average lifespan of tank models. Fewer replacements over time mean more savings.

Additional Costs to Consider

When budgeting for a tankless water heater, it’s important to account for more than just the unit price:

Annual Maintenance – Regular descaling and flushing is essential to keep your system efficient. Action Furnace offers maintenance services to help prevent breakdowns and extend the life of your unit.
Extended Warranties – Many homeowners choose added coverage for peace of mind, which can increase initial costs but protect against future repairs.
Water Softeners – In areas with hard water, installing a water softener helps reduce scale buildup, ensuring your unit runs efficiently and lasts longer.

At Action Furnace, we walk you through all these considerations upfront so there are no surprises.

If you’re ready to enjoy endless hot water, lower energy bills, and a reliable system built to last, contact Action Furnace today for a personalized quote. Our Comfort Advisors are here to help you choose the right tankless water heater for your home and budget.

Frequently Asked Questions About Tankless Water Heaters

What are the benefits of a tankless water heater?

A tankless hot water heater is more energy efficient than a traditional storage tank hot water heater, as it only heats water when it is needed, reducing standby heat loss. They also take up less space, and provide hot water on demand.

Can I install a tankless water heater myself?

Do not attempt to install a tankless water heater by yourself, as this can cause damage to your new heater or plumbing, and may also affect your heater’s warranty. Instead, contact Action Furnace and let us make sure your system is installed properly.