The average household spends $400-600 per year on water heating, making it the second largest energy expenditure after heating and cooling. Water heaters have come a long ways in the last 20 years and are now much more efficient. Yet most Americans still have older conventional water heaters that do not take advantage of these efficiencies. Some consumers are finding tankless water heaters to be an excellent way to cut costs and be more energy efficient.

First of all, it helps to understand the difference between traditional and tankless water heaters.  Traditional water heaters are designed to heat and store water in a tank, usually 40-50 gallons at a time.  When this water is used, the tank is filled again with new water from your water source, which is then heated and stored until the next time, an endless cycle. 

Tankless water heaters, however, provide hot water only as it is needed.  They heat water directly without the use of a storage tank, thereby eliminating the standby energy losses associated with storage water heaters, which will save you money.  By heating water only when it’s needed, gas tankless heaters can cut expenses by 30%, while providing a continuous supply of hot water.

Rinnai, a manufacturer of tankless water heaters (EnergyStar rated), reports that you can see energy efficiencies as high as 50% with their tankless water heater.  With an 84% EF (energy-efficiency rating) these units will recoup their initial investment in a short period of time through savings realized when you are only heating water when you need it.

Tankless water heaters have a lot of benefits for homeowners.  They have about twice the life expectancy of a traditional water heater and are wall mounted so they don’t take up any floor space.  Tankless systems also feature flash heating technology, which combines ultra-efficient consumption with low-emission technology, reducing CO and NOx emissions and your home’s carbon footprint.

An important factor if you are considering a tankless water heater is whether to go with an electric or gas unit.  If you have a big house, with more than one bathroom, you will need a large unit that can keep up with the heating.  The best choice would be a gas heater because the capacity is much higher and it can heat the water faster than an electric heater.  For a smaller house or an apartment, an electric heater is best.  It is smaller and easier to install.

With a tankless water heater you are able to provide an endless supply of hot water efficiently throughout your home, you have the capacity to provide hot water to multiple appliances simultaneously with significant energy savings, and with the compact installation you save on valuable square footage that can be better used in your home.  Don’t pay for something 24 hours a day you’re not using 24 hours a day!

Sources: