Tankless Water Heaters Gaining in Popularity
Tankless water heaters have been in use in Europe and Asia for over 20 years. They are just starting to gain wider acceptance and use in the United States. Tankless water heaters are more energy efficient than traditional tanks because they heat water as it is used, rather than heating and re-heating water in a storage tank. They are also common in Europe and Japan in large part because they take significantly less physical space.
We have found that our customers that have installed tankless water heaters have been very pleased. We install most brands of tankless water heaters including both indoor and outdoor units. A customer service representative can also help you decide which unit would work best for you.
Tankless water heaters are gaining in popularity in the U.S. for several reasons:
Endless Hot Water
Since a tankless unit heats on demand, hot water will not run out. This is especially useful for large families or for homes with larger hot water demands - for example homes with a soaking tub or spa system are often good candidates for a tankless system. If you are considering upsizing your tank from 40 or 50 gallons to 66 or 80 gallons, we strongly recommend you also consider a tankless hot water heater.
While traditional hot water tanks are compared based on gallon capacity, recovery rate and first hour rating, tankless hot water heaters are compared based on flow rate. As long as the home uses hot water at a flow rate below the tankless heater's maximum flow rate, there is no "recovery"; first hour usage is for practical purposes unlimited.
Flow rates for residential tankless hot water heaters are measured in gallons per minute based on a given heat rise (typically 25 or 50 degrees) and range from 4 gallons per minute to 8 gallons per minute. A unit that heats 4 gallons per minute can handle a shower plus one appliance operating at the same time. A unit with over 7 gallons per minute can typically handle two showers and a large appliance.
Important to note: Tankless units do not provide “instant hot water” as hot water still takes time to flow from the unit to the tap or shower.
The footprint of tankless units is much smaller freeing up additional space in the home or garage.
The most efficient traditional gas tanks today currently operate at 62% efficiency. Efficiency is a measure of heat transfer from the energy source to your hot water. Tankless units typically operate at over 80% energy efficiency. Tankless units further save energy because water is not constantly heated, cooled and re-heated within a storage tank. And while efficiency for traditional tanks can decline over time as sediment builds up in the unit, tankless hot water heaters maintain their efficiency over time.
Overall, a consumer who uses the same amount of hot water can save between 30-60% of their water heating energy costs assuming they do not change their water usage habits. Annual energy costs for heating water in the typical home range from $150-400 per year but this varies widely.
High Quality/Longer Lasting Product
Tankless units can often last two times the life of a traditional tank.
Home Resale Value
In some cases, home owners may be able to recover the cost of a tankless installation as a tankless hot water heater may increase the sale value of your home.
What Cash Incentives are there for Installation of a Tankless Unit?
As of February 17, 2009, The American Recovery and Reinvesment Act established a 30% tax credit on installation of gas tankless water heaters with an energy efficiency of .82 or greater with a maximum tax credit of $1,500. This is a tax credit rather than a deduction which means you receive savings dollar for dollar (a deduction gives you the amount times your marginal tax rate in savings).
This substantially reduces the payback period for tankless conversions. In particular, if you currently have an electric water heater and you convert to a gas tankless water heater, the payback period may in some cases now be less than five years.
Be sure to also check incentives with your local energy company as well. We list some of the incentives available in our service area on our Specials page. Most energy companies in California and Oregon have some incentive. Currently additional incentives for customers in Western Washington are very substantial in particular if you are converting from an electric water heater.
What Size Tankless Unit Should I Purchase?
Currently most major tankless water heater manufacturers make several sizes of tankless water heater. Unlike traditional tanks, tankless water heater sizes are measured by their per minute flow rate rather than by their gallon capacity. Typical flow rates for most major brands range from four to eight gallons per minute (or GPM).
In our experience, smaller four to five GPM units are suitable for studio apartments and small one bathroom homes or other application specific needs. For homes with two bathrooms or more, we strongly recommend installing a six to eight GPM unit as these units can typically service two or three applications at the same time. For very large homes, there are other options including installing multiple tankless units at the same location.
How much will it cost to install a tankless unit?
Cost to install a tankless unit varies greatly. We usually must perform an estimate in order to determine total cost. However, total cost generally ranges from $2,000-4,500 installed.
In order to install the unit properly you must have gas or propane and we typically must:
- Run a dedicated gas line to the unit because tankless units typically require up to 200,000 BTUs at full fire.
- Install category 3 stainless steel venting. This may require us to relocate the unit to an exterior wall or outside.
- Install additional piping if we need to relocate the unit.
- Run dedicated power to the unit. Please note in the event of a power outage, the unit will not provide hot water without power. However, we can install a backup battery system if you require it.
If you already have a tankless water heater properly installed or if your home is newly constructed and set up for a tankless unit, cost of installation drops significantly!