Current International Association of Geodesy efforts within regional geoid determination include the comparison of different computation methods in the quest for the “1-cm geoid.” Internal (formal) and external (empirical) approaches to evaluate geoid errors exist, and ideally they should agree. Spherical radial base functions using the spline kernel (SK), least-squares collocation (LSC), and Stokes’s formula are three commonly used methods for regional geoid computation. The three methods have been shown to be theoretically equivalent, as well as to numerically agree on the millimeter level in a closed-loop environment using synthetic noise-free data (Ophaug and Gerlach in J Geod 91:1367–1382, 2017. 10.1007/s00190-017-1030-1). This companion paper extends the closed-loop method comparison using synthetic data, in that we investigate and compare the formal error propagation using the three methods. We use synthetic uncorrelated and correlated noise regimes, both on the 1-mGal ($$=10^{-5}~{\mathrm {m s}}^{-2}$$
=
10
-
5
m
s
-
2
) level, applied to the input data. The estimated formal errors are validated by comparison with empirical errors, as determined from differences of the noisy geoid solutions to the noise-free solutions. We find that the error propagations of the methods are realistic in both uncorrelated and correlated noise regimes, albeit only when subjected to careful tuning, such as spectral band limitation and signal covariance adaptation. For the SKs, different implementations of the L-curve and generalized cross-validation methods did not provide an optimal regularization parameter. Although the obtained values led to a stabilized numerical system, this was not necessarily equivalent to obtaining the best solution. Using a regularization parameter governed by the agreement between formal and empirical error fields provided a solution of similar quality to the other methods. The errors in the uncorrelated regime are on the level of $$\sim $$
∼
5 mm and the method agreement within 1 mm, while the errors in the correlated regime are on the level of $$\sim $$
∼
10 mm, and the method agreement within 5 mm. Stokes’s formula generally gives the smallest error, closely followed by LSC and the SKs. To this effect, we note that error estimates from integration and estimation techniques must be interpreted differently, because the latter also take the signal characteristics into account. The high level of agreement gives us confidence in the applicability and comparability of formal errors resulting from the three methods. Finally, we present the error characteristics of geoid height differences derived from the three methods and discuss them qualitatively in relation to GNSS leveling. If applied to real data, this would permit identification of spatial scales for which height information is preferably derived by spirit leveling or GNSS leveling.