There's nothing more relaxing after a rough day than a long, hot shower. But if you've ever run out of hot water mid-shower, you've certainly experienced an unwanted chill. If this happens regularly in your house, it may be time to consider upgrading your water heater. With today's rising energy costs, you may be wondering whether a tankless model can deliver greater energy savings and efficiency than traditional models. Let us help!
In this blog, we'll explain how tankless water heaters work, outline their benefits, compare them to conventional tanks, and help you choose the best option for your home.
What Is a Tankless Water Heater?
A tankless water heater—also known as an on-demand water heater—heats water only when you need it. Unlike traditional storage-tank systems that continuously heat and store 30 to 50 gallons of water, a tankless model warms water instantly as it flows through the unit. When you turn on a hot water tap, cold water travels through the system and is heated by either a gas burner or electric element. Because there's no storage tank and no standby heating, tankless water heaters can be more energy efficient while providing a continuous supply of hot water.
What Are the Benefits of a Tankless Water Heater?
In addition to providing hot water on demand, the benefits of tankless models include:
Energy efficiency and savings. According to the U.S. Department of Energy, tankless water heaters can be 24%–34% more energy efficient than conventional storage tank water heaters.
Upfront cost. The cost of a tankless water heater varies based on the size of the home, fuel type, and installation needs. In many cases, total installation costs fall between $3,000 and $5,000 or more. While this is typically higher than a standard storage-tank model, tankless systems offer continuous hot water and other advantages that may make the investment worthwhile for some households.
Space savings. While traditional tank water heaters take up a lot of floor space, tankless water heaters are small and mount neatly on the wall. Choosing a compact tankless system can help free up valuable storage space in your home.
Longer lifespan. While the typical storage tank water heater lasts about 8 years (roughly), tankless water heaters can last up to 20 years if they're maintained regularly. Plus, they have easily replaceable parts for many years of trouble-free operation.
Cleaner water. You won't have rust or sediment buildup from stored water.
Reduced risk of leaks. There is no large tank to rupture and cause leaks.
Potential rebates. Some utility companies offer rebates for energy-efficiency upgrades, helping put money back in your pocket.
How Does a Tankless Water Heater Work?
If they have no tank, how do tankless water heaters work? Instead of a large tank, these models look like metal boxes, roughly the same size as your circuit breaker box.
The water heating process works like this:
You turn on the hot water anywhere in your home.
Cold water flows through a pipe inside the unit.
The system ignites and heats the water as it passes through a heating element.
Hot water is produced instantly—only when you need it.
You have a continuous supply of hot water.
Key Types of Tankless Water Heaters
Tankless water heaters come in two main types: electric and gas.
Electric tankless water heaters: These use electric heating elements to warm water as it flows through the unit. These systems are best suited for smaller homes or point-of-use applications.
Gas tankless water heaters (natural gas or propane): These use burners to heat water on demand and can handle higher hot water demand, making them ideal for larger households. Gas models may also be classified as condensing or non-condensing, which refers to how efficiently they reuse heat during operation.
Common Questions
Can You Run Out of Hot Water with a Tankless Water Heater?
You won't run out of hot water like you might with a storage tank. But there are limits. Here are some things to keep in mind:
Tankless water heaters heat water on demand, so there is no storage tank to empty.
Tankless systems have a maximum flow rate (the amount of water that comes out at once, i.e. gallons per minute).
You will have an endless supply of hot water as long as the unit can keep up with demand.
If all your hot water fixtures are running simultaneously (shower, faucet, dishwasher, washer, etc.), the water may be lukewarm, but not cold.
What Size Tankless Water Heater Do I Need?
So, what size tankless water heater do you need? The right size for a home is determined by how much hot water your household uses and when it's used.
Factors include the number of people in the home, the number of bathrooms and appliances that use hot water, and how often multiple fixtures run simultaneously. For tankless water heaters, sizing is based on flow rate (gallons per minute) and the temperature rise needed to heat incoming cold water. For storage tank water heaters, tank capacity and reheat rate are key considerations. Proper sizing ensures consistent hot water without wasting energy.
Is a Tankless Water Heater Right for Me?
Still on the fence about what type of water heater to invest in? Here are some things to think about:
Choose tankless if: You have a smaller household, limited space, or want long-term energy savings and an endless supply of hot water. (Be prepared to pay more money upfront.)
Choose traditional if: You have a tighter upfront budget, high water demand, or want lower installation complexity.
Do Tankless Models Need Maintenance?
Yes! To prevent unwanted repairs or breakdowns, tankless water heaters need filter cleaning and annual descaling. The good news is that ARS can easily handle this service for you each year!
Ready to Upgrade Your Water Heater? Call Us!
Purchasing a new water heater is an investment. So, when the time comes to upgrade your current system, give our team a call. Our professional plumbers and technicians can walk you through the replacement process and recommend the right option for your home.
As always, professional installation matters when it comes to home safety, efficiency, and warranty considerations. We are here for you through it all!
Call 866-399-2885 to schedule your consultation, or do it online here.
