Homeowners around Modesto ask us this every week, usually while we’re standing next to a 50-gallon tank that’s on its last legs. You want endless hot water, lower gas use, and more space in the garage. You also don’t want a surprise on your PG&E bill. The honest answer: it depends on the fuel type, your household’s hot water habits, and how the system is sized and installed. Let’s break it down using real numbers, local rates, and what we see in Modesto homes from La Loma to Village One.
Electric vs. gas tankless: the bill you care about may shift
Tankless water heaters come in electric and gas models. Most Modesto homes that call us already have natural gas service, so gas tankless tends to win on operating cost and performance. If you go with an electric tankless, your electric bill will almost certainly go up, sometimes a lot. With a gas tankless, your gas use drops compared to a tank, and electricity use changes little.
Electric tankless units draw a lot of power when you run hot water. A whole-home unit can require 24 to 36 kilowatts. That means multiple double-pole breakers, heavy-gauge wiring, and a panel upgrade in many houses. They save space, but those spikes hit the electric meter hard. In our area, tiered and time-of-use rates can magnify that hit if your showers land in peak hours.
Gas tankless, by contrast, uses a burner that modulates with demand. You still use electricity for the control board and fan, but it’s minimal. Gas is generally cheaper per BTU than electricity in Stanislaus County. The result: your gas bill usually goes down versus a tank, your electric bill barely moves, and your total energy cost drops if you use a typical amount of hot water.
What we see on Modesto utility bills
PG&E rates vary by plan and season, but here’s a reasonable picture from service calls and client follow-ups:
- Households that switch from a 40- or 50-gallon gas tank to a properly sized gas tankless usually see a 10 to 20 percent reduction in total energy cost for hot water over the year. The electric bill changes little, typically less than $5 a month difference. Households that move from an electric tank to an electric tankless tend to see mixed results. Standby losses disappear, which helps, but the high-power draw and time-of-use penalties can push bills up if most hot water use lands in peak windows. Some customers save, many break even, and some pay more. It hinges on usage timing and rate plan.
If you’re on CARE or a special plan, the math shifts. That’s why we ask for a recent bill during an estimate. Two minutes with real data keeps expectations honest.
Why tankless saves energy but might change your electric bill
Traditional tanks keep 40 to 80 gallons hot all day. That’s standby loss. Tankless units fire only when you open a tap. No standby heat means less wasted energy across a month. That part is simple.
The nuance is in fuel and power draw:
- Electric tankless: no standby, but extremely high instantaneous wattage. Take two back-to-back showers and a load of laundry at 6 pm, and you’ve pulled a lot of kilowatt-hours during a peak period. On time-of-use plans, that’s where bills jump. Gas tankless: no standby, gas burner scales with flow, and electric use is minor. Your electric meter barely cares. Your gas meter spins during use but with better efficiency than many older tanks, especially those vented through the roof with high standby losses.
Real-world examples from local homes
A couple in the College area had a 16-year-old 50-gallon gas tank. They ran out of hot water on weekend mornings. We installed a 180,000 BTU condensing gas tankless with a recirculation feature tied to a push-button control near the primary bath. Their electric bill changed by about $2 per month on average. Their gas use fell roughly 15 percent. They stopped scheduling showers like a chess match and were happier than the spreadsheet can show.
A rental in West Modesto had an electric tank in a tight closet. The owner wanted to save space and avoid a drain pan replacement. We priced an electric tankless with a required panel upgrade from 100 amps to 200. The unit would have covered two showers, but the projected electric cost during evening peaks would likely increase the tenant’s bill. The owner chose a high-efficiency hybrid electric tank instead. Their bill went down, and the space issue was solved with a shallow pan and side discharge. Tankless wasn’t the right fit there, and that’s okay.
Sizing and flow rates matter more than most people expect
Wrong sizing is the fastest way to get a higher bill and a poor experience. We size by flow and temperature rise. In Modesto, incoming water is cooler in winter, often around 50 to 55°F. For a 120°F setpoint, that’s a 65 to 70°F rise. If your family runs two showers and the dishwasher together, you may need a unit that supports 6 to 8 gallons per minute at that rise. Undersize the unit and it will throttle flow or run longer to meet demand, and you may crank the temperature to compensate, which wastes energy.
We also pay attention to fixture flow. A showerhead stamped at 2.5 gpm often flows closer to 2.0 to 2.3 gpm in real homes. Modern faucets are usually 1.2 to 1.5 gpm. We measure where needed and design for your actual use, not the catalog.
Venting, gas line, and panel realities in Modesto homes
Older Modesto houses often have half-inch gas lines that feed a tank just fine but starve a tankless under peak load. knightsplumbinganddrain.com tankless water heater services near me Many tankless models need a three-quarter-inch line and enough supply pressure. If the gas line is undersized, the unit hunts, efficiency drops, and your bill goes the wrong direction. We check the meter capacity and the longest run in the house before we quote.
For venting, non-condensing tankless units need Category III stainless venting and clearances. Condensing units can use PVC or polypropylene with condensate treatment, which opens up better routing options. We prefer condensing models for efficiency and flexibility. Electric tankless avoids venting but often demands a service panel upgrade. If your home has 100-amp service, plan on electrical work. That cost can dwarf the heater itself, which changes the ROI.
How recirculation affects your costs
Recirculation pumps bring hot water faster to distant bathrooms. That means less waiting, less water down the drain, and a nicer morning. It also means the system runs more often. A dumb, always-on recirc loop can defeat the main benefit of tankless technology by simulating standby loss through constant circulation.
We set up smart recirculation. Options include demand buttons, motion sensors in the primary bath, or short timer windows for busy hours. With the right control, you get fast hot water without the energy penalty. Used this way, we see no meaningful increase in electric bills and only a slight uptick in gas use, usually offset by water savings and convenience.
What makes bills go up with tankless
Three patterns show up when customers report higher-than-expected bills:
- An electric tankless on a peak-heavy time-of-use plan combined with evening showers, dishwashing, and laundry. This stacks high kWh during the most expensive window. Oversized or poorly tuned gas tankless that short-cycles or runs hotter than needed. Improper gas pressure or wrong venting harms combustion and costs you money. A recirculation loop that runs nonstop or most of the day. That defeats on-demand logic and drives continuous burn.
Each of these is solvable. Rate plan changes, control strategies, and proper commissioning make a large difference.
Maintenance matters for efficiency
Mineral buildup is real with our water. While Modesto’s water hardness varies by neighborhood, scale can form on the heat exchanger in a year or two. Scale forces higher burner output to achieve the same outlet temperature. That shows up on your bill. We install isolation valves and recommend a descaling service every 12 to 24 months depending on usage and hardness. The visit is quick, and the unit runs like new afterward.
Air intake screens collect debris in garages, especially near dryers. We clean those during maintenance. A starved intake reduces efficiency and can trigger nuisance faults that waste energy and your time.
How your habits influence the final number
Even a perfect install can’t rewrite habits. Tankless gives you endless hot water, which can stretch shower time. That erases savings fast. If you keep shower lengths roughly the same, you’ll bank the efficiency you paid for. Low-flow fixtures help, and many modern heads feel great at 1.8 gpm. Setting your water heater to 120°F instead of 130 or 140 also cuts gas use and is safer for kids.
For electric tankless, shifting laundry and dishwashing to off-peak hours helps. We can look up your PG&E plan during the estimate and suggest a schedule that fits your routine without the calendar gymnastics.
Cost of ownership: the bigger picture
A gas tankless unit typically costs more upfront than a like-for-like gas tank, especially with venting or gas line upgrades. Over 10 to 15 years, lower fuel use and longer lifespan often balance the math, particularly in multi-person households. Electric tankless has lower equipment cost in some cases but often needs panel upgrades, which swings the total project cost back up. Hybrids and high-efficiency tanks sometimes beat electric tankless on total cost in homes without gas.
We walk through these options with you. Our goal isn’t to sell a specific box; it’s to get you reliable hot water at a fair long-term cost.
What about rebates and codes in Modesto?
Rebates change. Gas tankless incentives have tightened in some programs while electric incentives grow in electrification initiatives. Local code requires proper venting, combustion air, seismic strapping where applicable, condensate neutralization on condensing units, and correct gas sizing. Skipping any of this chips away at efficiency and can risk safety. We pull permits and meet code so you don’t inherit hidden problems.
If you ask us about a “tankless water heater near me” because you want same-week service, we’ll also check current rebates and utility offers. Sometimes there’s money on the table for high-efficiency gear or smart recirculation controls.
A quick way to predict your bill
Here’s a simple rule we use during estimates. If you currently have:
- A gas tank and you switch to a well-sized gas tankless: expect lower gas use and roughly the same electric bill. Total energy cost goes down in most families of three or more. An electric tank and you switch to electric tankless: your standby losses disappear, but your electric bill may go up if you shower and run appliances during peak hours. If you can shift usage to off-peak, you may break even or save modestly.
That’s the short version. Your home and habits set the final numbers, which is why site visits and bill reviews are worth the time.
Why professional sizing and installation matter in Modesto
We’ve replaced dozens of “budget installs” where the unit was fine but everything around it was wrong: undersized gas line, poor vent pitch, no condensate neutralizer, no isolation valves, or a recirculation loop that blasted 24/7. These setups run hot, run long, and run expensive. A clean, code-compliant install with proper commissioning keeps the flame stable, the temperature tight, and your utility costs where they should be.
We also program the unit for your fixtures and lifestyle. That includes temperature limits, recirc logic, and ramp rates that suit your plumbing layout. Small tweaks at startup save money for years.
Thinking of switching in Modesto? Start with these steps
If you’re comparing quotes or still deciding between gas tankless, electric tankless, or a high-efficiency tank, a short checklist helps you avoid surprises.
- Grab a recent PG&E bill and note your rate plan, average kWh, and therms. Count simultaneous hot water uses in your peak moments, like two showers and a dishwasher. Note your main panel size. If it’s 100 amps and you’re eyeing electric tankless, plan for an upgrade. Check where the current heater sits and how far it is from the farthest bath. This influences recirc strategy and vent routes. Decide if faster hot water to distant taps is a must-have. If yes, plan for smart recirculation, not always-on.
Bring this to your estimate. It speeds up accurate sizing and a straight answer on your bill.
Ready for a quote from a local pro?
If you’re searching for a tankless water heater near me in Modesto, you want someone who can run the numbers, not just hang a unit. Knights Plumbing and Drain installs and services gas and electric tankless systems across Modesto, Riverbank, Salida, and nearby neighborhoods. We’ll look at your current utility use, water habits, and the real constraints of your home. Then we’ll show you the options that make sense, including total project cost, expected operating costs, and maintenance needs.
Call us or book online for a no-pressure visit. We’ll tell you if a tankless system will raise your electric bill, lower your gas bill, or if another solution fits better. Endless hot water is great. Paying for more energy than you need isn’t. Let’s set it up right the first time.
Knights Plumbing and Drain provides professional plumbing services in Modesto, CA, and nearby communities including Riverbank, Ceres, Turlock, and Salida. Since 1995, the team has delivered reliable residential and commercial plumbing solutions, from drain cleaning and water heater repair to leak detection and emergency plumbing. Homeowners and businesses trust their licensed plumbers for clear communication, quality service, and lasting results. If you need a plumber in Modesto or surrounding areas, Knights Plumbing and Drain is ready to help.
Knights Plumbing and Drain
Modesto, CA, USA
Website: https://www.knightsplumbinganddrain.com/
Phone: (209) 583-9591