**A simple guide to gas consumption and cost of a tankless water heater**.

If you do a search trying to find out how much propane your tankless water heater uses you will be met by a ton of fluff, not many people actually giving you an answer. In short, the average household using propane as the fuel source will use around 200 gallons of propane for water heating per year, (assuming they are using a tankless water heater).

If you want to know how this figure was determined then read on ahead, I will go into it in detail so you can adjust the number to reflect your situation a little more closely.

Besides figuring out how much propane you will use I also discuss the potential cost savings compared to a storage tank system and an electric water heater, so you can decide if the tankless option is something you should consider.

## Does It Save Money to Switch From Electric to Gas Hot Water Heaters?

In most cases, simply switching from an electric water heater to a gas hot water heater is an easy way to save money on your utility bill. Because a gas water heater is more efficient than an electric tankless water heater. Plus, when they are not in use they use little to no electricity.

### How Much Gas Does a Tankless Water Heater Use?

A tankless water heater uses 1/3rd the amount of propane that a traditional water heater does.

This is because they only heat water when needed so they are not wasting energy keeping a large volume of water hot in a storage tank. Also, modern instantaneous type water heaters have highly efficient heat exchangers, so they waste very little heat energy compared to older style units.

This results in a lower annual unit cost of fuel making them a great choice for anyone looking to save on their energy bills.

New regulations mean that water heaters should come with an energy label and tell you how much propane and water they use, but if you are buying your unit online they may not come with the U.S. compliance stickers.

If you don’t have the information on your unit or you are a numbers geek like me and want to work out for yourself just how much gas you use, it is actually quite easy to do so using a few simple formulas.

To determine how much propane your tankless heater will use you first need to know what the Energy Efficiency Rating of your heater is. Usually referred to on your unit’s datasheet as either EF or EUF.

For the following example, we will use the propane-powered Rheem RTG-95DVLP with an EF rating of .82 which is about the average for a modern instant gas heater.

Once you know your hot water units EF/EUF Rating it is as simple as doing a little maths. It is worth noting that this calculation is based on the average 3 person household use, so if you are single it will probably be lower, likewise, if you are a large family, or have kids like mine that spend hours in the shower it will be higher.

Based on the US Department of Energy assumptions the average 3 person household uses a bit less than 1/2 a therm a day on water heating, 0.4105 therm/day to be exact.

Never heard of a Therm before? That is because it is not used very often. You will probably have seen BTU noted on your heater somewhere though.

Water heaters use BTU as their unit of measurement, 1 BTU is the measurement of energy used to raise 1 pound of water, 1 degree Fahrenheit. (8.33 pounds of water = 1 gallon)

1 therm = 100,000 Btu meaning the average household uses 41,045 Btu/day for water heating. And there are 91,502 BTU per Gallon of Propane.

Confused yet? Don’t be… it all will make sense when we start putting the information together.

Okay, let’s put all that crazy information into a fairly simple math equation that way we can figure out how much propane you will use per year, assuming that you have a tankless system similar to the Rheem RTG-95DVLP.

### Formula for Calculating Annual Tankless Water Heater Propane Use

The formula we are going to use to work out the yearly propane consumption is:

**(Days in the year) X (Av BTU use) ÷ (Energy Efficiency Rating) ÷ (BTU per Gallon) = Average Annual Propane Use (in Gallons)**

**365 X 41045 ÷ 0.82 ÷ 91,502 = 199.7 Gallons of propane per Year**

Currently, the average price per gallon of propane in the US is $2.295, making the cost to run this propane heater around $460 per year.

### How Much Money Could You Save Switching to a Tankless Water Heater?

Let’s assume you had a heater with a much lower energy efficiency rating, would it really make much difference to your annual propane bills? Let’s have a look and see two comparisons.

### Calculating Gas Storage Heater Propane Cost

If you had an old storage hot water system your EF rating could be as low as 0.35. If we run the calculation again it is clear to see that you would be spending quite a bit more per year on your energy bills.

**365 X 41045 ÷ 0.35 ÷ 91,502 = 467.8 Gallons of propane per Year. Costing you $1,073 per year.**

### Calculating Electric Tankless Water Heater Cost

To work out how much your electric water heater costs we use a similar formula, however instead of BTU we use kilowatt-hour (kWh) and the average daily household kilowatt-hour usage for water heating is 12.03.

In this example, we will use the Rheem Performance Standard 36 Gallon Electric Water Heater with a UEF of .92 and the average American electricity cost of 10.42 cents per kilowatt-hour.

**365 x 12.03 ÷ 0.92 x 10.42 = $497 per year**

### How Location Can Affect Your Propane Use?

The above examples are based on the average use for a 3 person household in the United States. So if you are an average home, in an average climate, with average water input temperatures then these numbers will be pretty close to your needs.

Unfortunately, water heaters are greatly affected by the water temperature they are receiving, simply because the larger the temperature gap, the more energy will be used to heat the water to your chosen temperature. Thankfully Rinnai has a very useful map showing water temperatures throughout the country, and it even includes a rough guide to how it will affect the hot water output.

So we need to do a bit more maths if you want to calculate your exact propane usage.

For this calculation, you will need to use the map, or test your water to find out your input water temperature. Then you need to determine the max flow rate of your system at that temperature, and finally the temperature difference between the input water temperature and your desired output hot water temp.

### Formula for Calculating Propane Use | Water Temperature & GPM Adjusted

**8.33 x GPM x Water Temperature Change = Total BTU per/min**

Assuming you live where the groundwater temperature is 57 degrees Fahrenheit, and want an output temperature of 107 degrees Fahrenheit, and the unit can deliver 3.9 GPM under these conditions then we work it out like this:

#### 8.33 x 3.9 x 50 = 1,624 BTU/minute

The average household uses hot water for around 30 minutes per day, so for this example, the daily BTU usage would be 48,730BTU per day, which is slightly higher than the Standard US average.

A second example would be if you lived in the far North with a groundwater temperature of 35 degrees and the unit can only deliver 2.9 GPM it looks like this:

**8.33 x 2.9 x 72 = 1,739 BTU/minute taking the daily BTU usage to 52,179 or around 253 Gallons of Propane per year.**

As you can see where you live will drastically affect how efficient your water heater is so it is worth taking the time to make these few calculations if you are budgeting your gas use.

## Frequently Asked Questions

### What Is a Btu?

BTU (British Thermal Unit) is the unit of measurement used to raise the temperature of 1 pound of water by 1 degree Fahrenheit.

### What Is a Therm?

A Therm is a large unit of measurement used to show energy use. 1 Therm is equal to 100,000 BTU.

### Is a Propane Water Heater Cheaper to Run Than Electric?

Yes, typically propane water heaters are cheaper to run than Electric, this may vary depending on your location and the cost of propane v’s the cost of electricity supply.

### What Is Ef or Euf?

EF is the old Energy Factor Rating EUF is the new rating and stands for Uniform Energy Factor. EF is still used in Canada EUF is the new standard for the USA.

### How Much Does Propane Cost?

Propane Costs in the United States vary. The average cost of propane at the moment is $2.295. Prices will vary between $2 per gallon and up to $4 per gallon for refills in some areas.

### How Much Do Propane Tankless Water Heaters Cost?

Small units can be bought for around $100 but reputable tankless heaters will cost between $600- $1,100.

### Are Propane Tankless Heaters Dangerous?

No, propane tankless heaters are not dangerous if they are installed properly, and regular maintenance is carried out.

### What Is the Formula to Work Out Propane Consumption?

8.33 x GPM (Gallons Per Minute) x Temperature Change ÷ 91,502 (BTU’s per Gallon) x time = Gallons of Propane

### How Long Will 100 Gallons of Propane Last?

For the average American household, 100 gallons of propane will be enough to supply 6 months of hot water. If propane is used for cooking then it will only last around 3 months.

### How Much Will I Spend on Propane to Power a Tankless Water Heater?

The average household cost of operating a propane tankless heater is $40 per month.