Take a look at the following terms:Tankless Water Heater, Standard Natural Draft Water Heater, Standard Induced Draft Water Heater, and On-Demand Hot Water. Do they all make sense to you?
If you’re like me, you thought you understood them. Tankless…. pretty obvious, right? NO TANK. But like most things, there’s a lot more to it than meets the eye. There’s actually a pretty big debate when it comes to whether to tank or not to tank. And, because hot water accounts for 20% of people’s energy bills (on average), it’s something to seriously consider. Let’s walk through some of what a Tankless is and is not to dispel some common misconceptions.
What Tankless is…
Tankless is small, compact, efficient with it’s energy use, and (whoa) this one’s big: endless hot water. My sixteen year old self could have really used one of these. Also, they’re just pretty cool technology. There’s basically a long coiled pipe inside a small (briefcase sized) box on the wall. When the water enters, the pipes heat up (whether gas or electric) and when the water leaves the box, it’s hot!
This is all well and good, except that like most really nifty things, they come with a price. Tankless Water Heaters are, on average, about twice as much money as a standard tank. That’s a big investment. But IS it an investment? This is where the debate comes in. Unlike a lot of energy-saving home purchases (of which we are big advocates), the point where monthly savings on hot water add up to pay off your investment of a Tankless can be about the time it wares out from old age (around 20 years), particularly when using natural gas.
What Tankless is not…
Tankless is not On-Demand hot water. This was news to me. Something as high-tech and expensive as Tankless should come with all the bells and whistles, right? The truth of the matter is that Tankless takes slightly longer to deliver hot water to the tap. The water comes into the box cold (as opposed to the constant heating of a standard tank), so when you turn on the tap to wash your hands or take a shower, it will take about 5 seconds more to receive that heated water. The water has to work it’s way through that coil until the coil has reached operating temperature.
Tankless is also not always the most cost-effective choice in a replacement situation. What? Yes. While the constant-heating of a standard tank is energy-intensive, and seems inefficient, if you’re family is using up all the hot water in the tank throughout the day, it’s basically acting like a tankless. Let’s say a family of 4 is taking a couple showers, a bath, a load of dishes, and a load or two of laundry per day (this is, coincidentally what our day often looks like at home). With our 40 gallon tank, we are using that sucker up, over and over.
Another thing to consider is that while neither technology is exempt from occasional repairs and annual service, Tankless is less forgiving of missed maintenance.
Here is one of our service techs, Colin, servicing a customer’s Rinnai brand tankless water heater. He is descaling the heat exchanger due to mineral deposits coating the heat exchanger surfaces and acting as an insulator decreasing heat transfer. The severity of this condition depends on water quality but it happens in all applications and on all water heaters (tank or tankless).
Most people know that corrosion is a big issue with standard water tanks, but clearly, it is something to watch for in tankless models, too.
Standard Tank (induced or natural draft)
If you are considering purchasing a Standard Tank Water Heater the big thing to remember is that though the various models and types look similar on the outside, they are definitely not all created equal. The main things to think about are: Fuel-type, Draft-type, and Warranty Length.
Fuel-type: Natural gas is significantly more affordable than electric or propane in most places. Natural gas models are more expensive up-front, but the investment pays off fast. In fact, the savings you’ll see in your energy bill (around half as much) will usually make up the difference in cost (between electric and gas) in about a year. Oil-fueled Water Heaters exist too, but are rare because of the very high cost.
Draft-type: A natural-draft water heater means that the combustion gases (including carbon-monoxide) come out the top of the water heater naturally, and therefore have the risk of back-drafting. These water heaters are fine, but are best installed outside the building envelope. Having one of these in your home could be dangerous. Talk to your HVAC professional to be sure. Induced-draft means that the gases are driven out of your home through a pipe and fan-system, which can be much safer.
Warranty Length: A longer warranty length may not sound like an important factor at first, but it really shows how confident a manufacturer is in it’s product. The warranty-length neatly bundles a lot of the questions regarding internal options of tank-style water heaters. This piece from Consumer Reports has a ton of GREAT information. They go through all the nitty-gritty like internal tank features, safety concerns, and even specific brands. But the most concise info I took away from it on water tanks is: “Those with longer warranties tend to have larger heating elements, thicker insulation, and thicker or longer corrosion-fighting metal anodes.”
Quick List of Pros/Cons
So the easiest answer to the whole question of what kind of water heater is best is: It depends on your family and your needs. Let’s break it down into a pros and cons list for convenience:
Tankless – Pros
- Endless hot water
- Energy Efficient (only heating the water used; better combustion)
- Compact, space-saving
- Easier to service (descale corrosion)
- Longer life (about 20 years)
- Decent ROI for propane-fuel homes
Tankless – Cons
- Up-front cost (about twice as much as a standard tank)
- Natural gas customers don’t see an ROI, because energy savings don’t make up for the cost
- Slightly longer wait time to receive hot water
Standard Tank – Pros
- Natural Gas models are fairly energy efficient (not quite so much as tankless)
- Up-front cost (about half as much as a tankless)
- Not as much of a delay in hot water reaching the tap in most homes
Standard Tank – Cons
- Constantly heating a huge tank of water (that may not be getting used throughout the day). Inefficient (for some families).
- Corrosion issues and mineral build-up occur within the tank and can’t always be seen or remedied
- Require a lot of space
- Shorter lifespan (7-12 years)