If you are replacing a storage water heater with a gas tankless unit, compare the price for a working installation, not the equipment price or the lowest headline quote. Ask each bidder to specify hot-water output in winter, verify whether the existing gas supply is adequate, and list venting, permits, and old-unit removal. This worksheet is for a U.S. homeowner comparing professional bids; it does not estimate your local labor rate.
Size the same job before comparing prices
The U.S. Department of Energy recommends using the maximum practical flow needed at one time and the required temperature rise. Suppose your installer estimates two simultaneous hot-water draws of 1.6 and 0.8 gallons per minute. That is 2.4 GPM. With 45°F incoming water and an illustrative 120°F outlet target, the temperature rise is 75°F. Ask both bidders for manufacturer performance at 2.4 GPM and a 75°F rise, rather than comparing the largest GPM printed on two boxes. These are sizing inputs, not a recommendation to change your temperature setting.
Ask for these line items
For the heater, record the model, installed equipment price, and labor. For gas and venting, ask what the contractor has inspected, what can be reused, what work is included, and which assumptions might change the price. If the model needs a condensate drain or treatment, ask where the installer plans to route it and whether that work is included. Ask who obtains permits when required, removes the old tank, completes startup and testing, and covers labor if a warranty claim arises.
Worked example: the lower quote can cost more
These are fictional bids for the same proposed output and scope. In Bid B, both listed extras have a written price; an unpriced item would leave the total unresolved.
| Scope | Bid A | Bid B |
|---|---|---|
| Quoted work | $3,250, all listed work included | $2,650 base |
| Gas supply work | Included | +$500 |
| Venting and permit allowance | Included | +$250 |
| Comparable total | $3,250 | $3,400 |
Bid B starts $600 lower but finishes $150 higher in this example. Confirm whether an allowance is a fixed charge or can increase. Check that both bids cover startup, disposal, warranty terms, and any finish repairs before deciding. If a contractor has not confirmed the vent route or gas capacity, ask for a site assessment and a written revision; do not count an unpriced item as zero.
Which price should you compare with a storage tank?
Compare the fully installed prices for both options and keep operating-cost assumptions separate. A like-for-like replacement of an existing compatible tankless system is a different job from converting a storage heater. Do not assume old venting can be reused. Have a qualified installer assess fuel supply, combustion venting, and local requirements for the specific model. Do not size gas piping or modify a vent yourself.
Related: Water Heater Repair vs. Replacement Cost in 2026: Compare the Failed Part, Not Just Age.
Sources
U.S. Department of Energy: Gas-fired tankless water heaters and sizing
U.S. Department of Energy: Tankless or demand-type water heaters