Informational Guide

How To Insulate An Outdoor Tankless Water Heater

Here, we look at how to insulate an outdoor tankless water heater for better freeze protection of the unit during winter.

by Holly Curell

Outdoor tankless heaters help home and business owners conserve water and energy. These water heaters offer a consistent supply of warm water and promptly heat water on demand.  

However, did you know that outdoor water heaters need additional upkeep in winter?  

Therefore, to withstand the cold weather, ensure proper insulation of the unit to avoid freezing. But the question is how to insulate outdoor tankless water heaters precisely?  

Read on to know more! 

A tankless water heater needs extra care during the winter season, primarily because cold weather is not too kind towards them. 

During winters, there is a high chance of standing water within the unit to freeze. This, in turn, damages some internal components.   

Though some models have built-in protection systems against freezing, however, there are a few caveats: 

  • To activate the systems, electric heaters need to be plugged at all times 
  • Even with embedded protection systems, excessively low temperatures may require extra steps to avoid freezing. After all, the freezing protection system only protects the unit’s critical components.  

In short, if you want to install your water heater outside, you can, but with certain precautionary measures.  

Outdoor Tankless Water Heater

Do Outdoor Tankless Water Heaters Need To Be Insulated? 

No matter if you’ve got an outdoor tankless heater or a traditional storage tank heater, insulating its pipes across the house can actually save energy and water.  

Even though some latest models come with embedded freeze protection systems, your unit doesn’t become impervious to freezing.   

For starters, the most susceptible component is plumbing pipes, as they are vulnerable to freezing up. To put it simply, cold weather indeed can damage your heating system’s internal parts if you don’t insulate them.  

With insulation, not only does the water heater remain protected, but its performance improves as well! Similar to insulating your roofs and walls, insulating your heater is affordable and an easy way to become more efficient.  

For example, insulating a heater, which is warm-to-the-touch, can slash standby losses by approx. 25-45%. In addition to that, it can save you about 7-16% yearly on the water bill.  

How To Insulate Your Outdoor Tankless Water Heater: Step-By-Step 

Here are the best ways for insulating and protecting tankless water heaters to prevent them from freezing. But first, gather your best materials to insulate a water heater.  

Essential Tools  

Here’s a list of materials you’ll need: 

  • Dust Mask 
  • Electrical Tape 
  • Gloves 
  • Marker 
  • Scissors  

Some power companies sell insulation blankets at a relatively low cost to encourage users if they’re doubtful whether they should wrap their water heaters. However, in case companies don’t provide them, go and buy a blanket from your nearest hardware store.   

Now that you know what tools you’ll need, here’s how you can insulate your outdoor tankless water heater: 

1. Set Up Your Heater In A Relatively Warm Place

It isn’t always possible, but installing your unit in a comparatively heated place will surely help protect it from frosting during winter. Utilize vent terminations incorporating air-resistant features and place them far away from cold winds.  

2. Drain The Water Heater 

Here’s a fact: water left behind in the heater can freeze. If this occurs, the unit’s internal plastic parts may get damaged.  

You can prevent it by ensuring to drain your unit, particularly when you’re away for long. Also, be sure to cut off the water supply using the provided valves when the heater is not in use for an extended period. 

3. Retain The Power Source 

Ensure the unit remains connected to an outlet so that the frost protection system activates when required. Remember, the system doesn’t need the unit to be on, instead only plugged in.  

And for places that often experience blackouts, either drain-down solenoids or employ an emergency power system.   

4. Consider The Recirculation System 

A recirculation system is typically installed to have warm water around for on-demand usage. One added advantage of this system is that during winters, all connected pipes remain protected from frost.   

5. Insulate Pipes 

Not only the unit but pipes are also in danger of freezing up. The problem is that the freeze protection system doesn’t safeguard the said pipes. So, how to insulate the pipes of your water heater?  

Insulate Outdoor Hot Water Pipe

Follow the steps below: 

  • Gauge The Length Of The Pipe You Intend To Insulate  
    First, measure the pipes you plan to cover. Take a paper, measuring tape, and a pen to note down all measurements. This way, you’ll find how much insulating tape and heating wire you’ll need. Ensure to get the measurements of every pipe on external walls and an uninsulated basement  - as every corner is susceptible to frosting.   
  • Buy Insulation For The Pipes 
    Once you get measurements, determine the kind of insulation you’ll buy. There are two options available, either you can opt for polythene insulation or heating wire and pipe tape.  
  • Wrap The Heat Tape To Your Pipes 
    Plug the heat tape into your closest power supply. After that, run the tape with the pipe and twist it every 13-inches to form a circular pattern. Also, make sure you have secured the heat tape with the pipe every couple of inches using electrical tape.   
  • Wrap Pipes With Insulation Tape 
    Once the heat tape is in place, wrap pipes with insulation tape. To do this perfectly, locate the vertical seam wherein the insulation is cut. After that, place your fingers in the vertical seam and draw out the insulation. Then, connect the insulation with the pipe. Do it by pressing the interior near the pipe. Repeat this procedure with all pipes.  
  • Secure Insulation With Duct Tapes Or Cable Ties 
    To keep insulation from slipping, bind it using a cable tie or duct tape. For better results, wind the tape near the bottom of insulation approx. 4 to 6 times and tighten it. In addition to that, you can connect it by winding it near the pipe and wrapping it from end to end. Then, place the cable tie or duct tape every 3 to 5 feet. Repeat the procedure with all pipes. Pro tip: one crucial thing to remember is never pull your pipes so hard when covering them with insulation as you surely don’t want them to break.  

If you'd rather a professional insulate your outdoor tankless water heater, then fill in the form below for a free quote in your area!

Popular Tankless Water Heater Models With Built-In Winter Protection 

Many manufacturers produce models with embedded freeze protection that allows the heater to guard itself when the temperature drops below freezing.  

This system prevents ice formation that can turn off the flow, clog lines, and cause damage to pipes, fittings, and valves. That said, here are two of the most popular brands that offer built-in winter protection models: 


Rheem is one of the most trusted brands among water heater manufacturers, and It’s one of the most commonly used water heaters in the US. 

One possible reason is Rheem provides winter protection models that withstand even the coldest winters.  

They manufacture models that offer constant protection from freezing. For example, their latest models come with exclusive features such as water leakage detection and an auto-shut-off valve, etc. 

Here are some Rheem models: 


More and more business owners and homeowners choose Rinnai water heaters. Want to know why? This is because Rinnai equips their heaters with double shield protection.

The first protection is they offer ceramic heaters that fire up as the temperature falls below freezing point. This way, it prevents its internal components from frosting. 

Apart from that, Rinnai heaters come with a sensor that decides whether a unit is below negative temperature or not.  

Here are a few models: 

Tankless Water Heater Freeze Protection

How To Thaw An Already Frozen Water Heater 

Want to know how to properly thaw your frozen water heater without damaging it? Follow the steps below: 

  • Step 1   
    First, check whether the unit or the pipes of the water heater are frozen. Mostly, this is the case. Touch the appliance to spot the frozen area. Once you find it, use your space heater to warm the ice-cold spot until it unthaws.  
  • Step 2   
    Locate the burst pipes. As water inflates when it frosts and if there’s insufficient space within the tankless water heater to help that spread, chances are the heater’s pipes may have burst. This means as the pipes unfreeze, you’ll have enough water to create a mess within the surroundings. Therefore, it’s recommended to know where the water shutoff valve is so that you can turn it off before unfreezing your water heater’s pipes.
  • Step 3   
    Immediately turn off the gas or water supply flowing to the heater when the unit has turned cold (if thawing frozen pipes of the heater didn’t work out as planned). Therefore, disconnect the device and take it outside the house. This way, even if it explodes as it unthaws, you’ll be saved from the mess that follows.  
  • Step 4   
    With the help of your space heater, melt the frosted portion.  
  • Step 5   
    Drain your unit as the frost lessens. First, cut off the water supply, then carefully open the mini drain valve placed at the bottom of your unit. 
  • Step 6   
    Open the air-release valve or hot faucet of the water heater. This way, the water will flow out when it unfreezes.   
  • Step 7   
    Check the heater thoroughly to ensure there isn’t any breakage from the spread of water before reconnecting the unit.  

People Also Ask (FAQs)

How much does it cost to insulate a water heater? 

Based on your water heater’s storage capacity as well as the R-value of the unit you opt for, the insulating blanket of a water heater will cost you anywhere between $25 to $80 or more.  

Does insulating a water heater save you money? 

Yes, insulating a water heater saves you plenty of money. Though most new models are insulated already; however if not, get it insulated because it can minimize standby losses by a substantial margin and can help you save up to 16% in heating costs.  

Does a water heater blanket really work? 

Yes, a water heater blanket actually works! It is primarily an added feature, which can be used on all tank-style heaters to increase their energy performance. They are also simple to install.  

How long does it take for water to get hot during cold weather? 

The average water heater takes about 30-40 minutes to heat the water fully in the tank. Also, compared to gas-powered heaters, electric water heaters take more time to heat water within the tank.   


Although water heater manufacturers are making models with built-in freeze protection, you still have to take precautionary measures to protect your unit from freezing. Next time, use this guide to insulate your water heater.  

Holly Curell is the editor extraordinaire for Plumbing Lab. Having grown up in Michigan, Holly has spent time living in New York, Virginia, & currently North Carolina, where she lives with her husband & family. Holly loves DIY & has years of experience with at-home plumbing problems that arise from having 3 kids & living in colder climates. When she's not writing about her plumbing knowledge, Holly enjoys reading, hiking & relaxing with family.