Tankless Water Heater growing at a CAGR of 10.2% from 2025 to 2033
The global tankless water heater market size was estimated at USD 4.02 billion in 2024 and is expected to reach USD 9.41 billion by 2033, growing at a CAGR of 10.2% from 2025 to 2033. The tankless water heater market is primarily driven by the rising demand for energy-efficient, on-demand hot water systems that reduce utility costs.
Key Market Trends & Insights
- Europe held the largest share of the tankless water heater market in 2024, accounting for 33.5%.
- In the UK, the push to phase out gas boilers by 2035 under the government’s net-zero carbon strategy is propelling interest in alternatives such as tankless heaters.
- By product, the electric tankless water heater market held the largest share of 69.2% in 2024.
- By application, residential tankless water heaters led the market and accounted for a share of 72.8% in 2024.
Market Size & Forecast
- 2024 Market Size: USD 4.02 Billion
- 2033 Projected Market Size: USD 9.41 Billion
- CAGR (2025-2033): 10.2%
- Europe: Largest market in 2024
- North America: Fastest growing market
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The tankless water heater market is primarily driven by advancements in heating technologies that offer improved performance and longevity. Growing environmental awareness is pushing consumers toward eco-friendly alternatives to traditional water heaters. Government incentives and rebates for energy-efficient appliances are also encouraging adoption. Moreover, the compact design of tankless systems makes them ideal for urban housing with limited space.
The increasing preference for smart home integration and remote-control features primarily drives the tankless water heater market. Rising disposable incomes and changing lifestyles are leading consumers to invest in premium home appliances. The hospitality industry’s demand for continuous hot water supply is also fueling market growth. Furthermore, the need to replace aging traditional water heaters is accelerating the shift toward tankless alternatives.
The tankless water heater market is primarily driven by growing awareness of water conservation and the need for sustainable living solutions. Rapid urbanization and the expansion of residential infrastructure in developing economies are creating new market opportunities. Technological innovations enabling faster heating and better temperature control are attracting tech-savvy consumers. In addition, rising energy costs are pushing both households and businesses to seek more cost-effective water heating options.
Product Insights
The electric tankless heaters in the tankless water heater market accounted for the largest share of 69.2% of the revenue in 2024. The electric tankless water heater market is driven by factors such as the increasing shift toward cleaner energy sources and the phasing out of gas-based systems in many regions. Rising electricity access in remote and developing areas is expanding the customer base for electric models. Consumers are also drawn to their lower installation costs and minimal maintenance compared to gas units. Supportive government policies promoting electrification and energy efficiency are further accelerating adoption. In addition, advancements in smart thermostats and digital controls enhance user convenience, fueling market growth. Companies such as Bosch and A. O. Smith offer electric tankless water heaters for commercial & residential use.
Tankless Water Heater Market Report Scope
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Report Attribute |
Details |
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Market value size in 2025 |
USD 4.34 billion |
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Revenue forecast in 2033 |
USD 9.41 billion |
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Growth rate (Revenue) |
CAGR of 10.2% from 2025 to 2033 |
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Actuals |
2021 – 2024 |
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Forecast period |
2025 – 2033 |
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Quantitative (Revenue) units |
Revenue in USD million/billion, and CAGR from 2025 to 2033 |
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Report coverage |
Revenue forecast, company ranking, competitive landscape, growth factors, and trends |
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Segments covered |
Product, application, region |
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Regional scope |
North America; Europe; Asia Pacific; Latin America; Middle East & Africa |
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Country scope |
U.S.; Canada; Mexico; UK; Germany; France; Italy; Spain; China; Japan; India; Australia & New Zealand; South Korea; Brazil; South Africa |
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Key companies profiled |
A. O. Smith; Rheem Manufacturing Company; Rinnai Corporation; Bradford White Corporation; Robert Bosch LLC; EcoSmart Green Energy Products, Inc.; Stiebel Eltron Inc.; Takagi; Noritz America Corp.; Navien Inc. |
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Customization scope |
Free report customization (equivalent up to 8 analysts’ working days) with purchase. Addition or alteration to country, regional & segment scope. |
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Pricing and purchase options |
Avail customized purchase options to meet your exact research needs. Explore purchase options |
