An Important Consideration for All Homeowners: Tankless Water Heaters

What is a Tankless Water Heater?

A traditional water heater consists of a large tank in which 80 gallons of water (or more) is heated and maintained at a set temperature, typically using gas or electricity. This water tank supplies your family’s needs for hot water for bathing, washing dishes, doing laundry, etc. Once the heated water has been drawn from the tank, you must wait until it refills and the entire tank of water is heated (usually 20 to 60 minutes).

A tankless water heater (also called an instant or on-demand water heater) provides hot water only if and when hot water is needed in your home. When you turn on a faucet, shower or appliance, water is heated instantly as tap water passes through “capillary-like” pipes heated by either electric coils or a powerful gas burner. Water does not sit in a large tank where it is continuously heated to a set temperature and maintained until needed.

Tankless water heaters can be installed either as whole-house systems (often consisting of three or more units each serving a part of the house). Smaller tankless units can also be installed at the point of use (for example, the kitchen sink, a shower or bathroom, etc.).

Advantages of a Tankless Water Heater

Tankless water heaters offer several advantages:

1. They provide an unlimited supply of hot water only when and where it is needed.

2. They heat only the amount of water needed at a particular time.

Disadvantages of a Tankless Water Heater

1. It cannot produce a large amount of hot water at once.

2. Turning the hot water on and off repeatedly can result in a sudden blast of cold water.

3. The amount of water a tankless unit produces depends on the temperature desired.

A traditional water heater provides 7.5 to 9.5 gallons of water per minute, which is typically enough hot water to supply three needs at one time. A tankless unit produces only 2.5 to 5 gallons, which will supply only two needs at one time. Further heating water to an increased temperature of 35 to 45 degrees will allow water to flow faster than heating the water by 77 degrees.

Cost of Tankless Water Heaters

The typical gas-fired tankless water heater will cost about $1,500 installed (about twice the cost of a traditional water heater or about $575 more than a high-efficiency tank model. However, installation will require replacing ½ inch pipe with ¾ inch pipe throughout your home at a cost of $25 to $40 per foot. This installation cost will be recovered in reduced operating cost. Electric tankless units cost far less, typically as little as $400 installed.

Typical Cost Savings with Tankless Water Heaters

• According to the U.S. Dept. of Energy, a tankless water heater is more efficient and uses less energy than a conventional water heater, providing a $25 to $107 in annual savings.

• If your hot water use is low (less than 41 gallons per day), a tankless water heater will be 24% to 34% more efficient.

• If your hot water usage is high (about 86 gallons per day), a tankless water heater is 8% to 14% more energy efficient.