Calculating Electrical Demand for New Construction with Electric Tankless Water Heater

200A Service is not nearly enough

When provisioning new service, by code, you're only allowed to plan to use 80% of the installed capacity. On a 200A service, that's 160A, and when you deduct your 140A water heater from that, that leaves only 20A for the entire rest of the house, which isn't nearly enough.

Load calculations aside, you won't even be able to make dinner with only 200A. Assuming either the AC or heat is on drawing 30A, and you have something in the oven, drawing 50A or so there, and then you turn on the hot water at the sink to rinse a dish, the water heater will draw 140A, for a total of 220A -- which trips the house's main breaker.

For a tankless hot water heater of this size, in a house with other standard loads, 400A service (sometimes called Class 320) is required, no way around it.

Or, use a water heater with a tank

A standard tanked resistive water heater only needs a 30A circuit, because it doesn't need to be able to heat the water as fast as it's used -- it can heat more slowly since it has a reservoir of hot water to supply for immediate needs. This should likely fit in your 200A service without much issue.

If you want or need to draw even less power, then a heat pump water heater is the way to go. They cost roughly 2-4x the price of a resistance heater upfront, but they use 3-4x less energy, so they tend to pay for themselves quickly -- if the same person buying the water heater is paying for electricity, which it sounds like is not the case for you. But they also use less power, so if you're trying to fit everything in without needing a service upgrade, it's still worth considering.

Tanked water heaters can also be very useful when your cost of power varies throughout the day, either because you have free power coming in from solar panels, or because your utility charges higher rates during peak hours (which SMUD does). Newer 'smart' tanked water heaters, (most commonly found on the heat pump kind), are aware of this, and will attempt to heat the water when electricity is cheapest, and save it for when you need it later, which tankless cannot do.

Another advantage of a tanked system in California is that during our increasingly frequent rolling blackouts, you'll still have hot water for a while when the power is out. With a tankless, when the power is out, you're taking cold showers until it comes back on.

Consider planning for both options

You mentioned in a comment that you're planning to rent this place out, and as such the long term electricity costs are not a huge concern to you now -- but consider that you might want to sell the place someday, and your buyer may take a different view. Since this is new construction, there are some things you can do very cheaply now that would be extremely expensive later, so it's worth thinking a little about future-proofing. One of those things that's easy to add now and much harder later is a site for a hot water tank.

As of today, electric heat pump water heaters are the most efficient thing on the market, and are becoming increasingly popular. Given the challenges the California electrical grid has had over the last few years, I would not be at all surprised if they become required at some point in the future. IMO it would be a mistake to build a house today that was not compatible with one, even if you initially install something else.

On the other hand, if you do put in a tank system today, to easily let the next guy switch to tankless if they want (assuming they get the service upgrade), you can simply install an oversized conduit from the water heater to the electrical panel -- it'll only cost a few tens of dollars extra.

There is no way you're getting 160A of tankless + your house onto 200A

A 1200 ft² house with a 2.5 ton, 16 SEER heat pump (by far and away the most reasonable thing to heat your house with if you don't have gas) and electric appliances other than the hot water heater takes up a load of 30640VA:

• 8100VA unfactored for general load assuming 2 kitchen circuits, which translates into 4785VA of factored general load after applying the 35% factor for general load over 3kVA,
• 5000VA for the dryer,
• 8000VA for a range of 12kVA or less,
• 32A * 240V = 7680VA for the car charger,
• and 18A * 230V * 1.25 = 5175VA for a representative 2.5ton/16SEER split system heat pump outdoor unit (a Goodman GSZ160301B to be precise).

In other words, your house already needs 128A of service according to Article 220, so your plans for tankless hot water on a 200A service are a total nonstarter. Furthermore, I did not include any BTUs of strip heat in that calculation, and Sacramento is not quite warm enough to forsake defrost altogether, so the only practical way you could get anywhere close to the 128A number is by using a mini-split instead of a North American-style split system for your heat pump. If you were to go with a split system, the mating air handler would require somewhere between 5 and 8kW of strip heat to match the capacity of your heat pump. Adding the 6.5A rated load of said mating air handler to the picture tacks on 8748VA, or another 36A, of load, putting you fairly close to a 200A service as-is, even with a conventional water heater tank.

As to your water heater options...

Since you don't have gas, your options are either a conventional electric tank heater, an electric tankless water heater with Class 320 service to feed the brute, or a heat pump water heater. Since Class 320 service adds a major first-cost to the house in the form of beefier service equipment, you're better off going with a tanked heater. The heat pump vs. electric decision is tougher, though, considering that there are really two types of heat pump water heaters out there.

Hybrid heat pump water heaters use a small unitary heat pump atop the heater to slowly heat water during idle times, while retaining an electric resistance element or two for busy times. These are inexpensive and easily installed, but have the downsides of being a slight parasitic heat drag on the house atop being mediocre performers as they are vulnerable to pathological usage patterns and poor at tank recovery after long draws. In fact, they can't even recover their full tank capacity in an hour's time, which means they only come in one size: big! However, one can mostly overcome the heat drag issue by ducting them to outdoor air or installing them in unconditioned space, such as a garage, which means that if you're willing to live with finessing hot water usage, their low first-costs are not necessarily a bad option.

If that option's unsatisfactory for some reason, your other choice is a split system heat pump water heater. These use an indoor tank, but mount the heating system outside, in a box similar to a mini-split's condensing unit, and circulate water between the two units. This drives up the installation cost and complexity somewhat, and makes them more expensive to buy, but gives these setups complete freedom from parasite load/heat drag issues. Furthermore, the split-system heat pump water heaters available in North America at this time are of a type called an "EcoCute" that uses CO2 for a refrigerant. These units use a combination of higher capacity (compared to unitary/hybrid heat pumps) and high temperature lift (from their CO2 refrigerant) to allow them to forsake supplemental electric heat, yet achieve first hour recoveries readily comparable to conventional water heaters. In other words, they rely completely on their heat pump for heating, which means they maintain a reasonable efficiency under pathological usage patterns.