Did you know that water heaters are the second highest source of energy usage in the home?

You might be surprised to learn that you can save money and lower this energy usage by switching to a tankless water heater.

Read on to find out if a traditional water heater versus tankless is right for your home.

Tankless Water Heaters

A tankless water heater has no tank, obviously. It heats up water as needed instead of keeping hot water in a tank at all times.

When you turn on the hot water tap at your sink, cold water is pulled into the water heater. A sensor ignites a gas burner that heats up the exchanger. The cold water passes by the exchanges and exits the heater at the correct temperature.

One of the main benefits of a tankless water heater is that it takes up less room. These tanks can be mounted on the wall and free up floor space. If your home does not have a lot of square footage, this may be a good choice for you.

Another plus is less energy consumption. Many tankless water heaters have Energy Star rating, which means they are certified as efficient. They save energy by heating water only when needed, eliminating energy lost during standby operation.

Tankless water heaters are versatile to suit your needs. They are available in single-room size or ones that can power the whole house. Count how many appliances and taps require hot water to know what unit size you need for your space.

Read more about how to select the right size water heater for your home.

Tankless water heaters typically also last longer (up to 20 years). The warranty on the part called the heat exchanger is usually good for around 12-15 years.

Disadvantages to Tankless Water Heaters

One of the major drawbacks of a tankless water heater is that you will pay more for the unit itself, as well as for the installation. How much more? Well, the unit might be as much as twice the price of a traditional water heater.

The installation cost is higher because these tanks take more work to install them. They need a larger gas line and specific venting requirements.

Since tankless water heaters need to heat water as it passes through, it could mean you don’t get hot water as quickly. You might also sometimes get served a “cold water sandwich”, which means that you get a burst of cold water in the middle of running the water.

Where you live plays a role in how fast you get your hot water. If you live in northern climes, your groundwater will be colder than if you live in the South. This will affect the speed and flow of the water.

Another big downside is the damage done to tankless water heaters by hard water.

Hard water is hard on every type of water heater, but it’s especially tough on tankless units. Problems caused by mineral build-up, lime, and scale in tankless water heaters are not covered by the unit’s manufacturer’s warranty.

Consider using a water softener if you live in an area that has hard water to help minimize damage to your equipment. Also, tankless water heaters require some regular maintenance. For example, they must be drained and flushed regularly and the filters need to cleaned every month.

Traditional Water Heaters

Traditional water heaters consist of a large cylinder tank, usually located in your kitchen or basement, that is heated to a specific temperature.

You can adjust this temperature so that no one operating a faucet could burn themselves, which is a great feature if you have young children at home.

One of the other good things about a traditional water heater is that the water is hot and ready to go. It does not require heating as it travels to your faucet. This means that you get the right temperature as soon as you open your tap.

Disadvantages of Traditional Water Heaters

As we previously mentioned, these tanks take up a lot of room. They are bulky and can hog your floor space.

Also, although the water is heated and ready to go in the tank, if you use all the water in your tank too quickly that day, you’re going to have cold showers.

Traditional water heaters hold a certain amount of hot water (typically 40-50 gallons, although you can get smaller or larger tanks). If you have guests visiting or happen to take a longer shower or a bath one day, you might be unpleasantly surprised with cold water. It takes quite a while for a tank to regenerate with hot water, and chances are you will have to finish your shower with cold water.

A traditional water heater uses electricity to heat the full tank of water. Even if you don’t use all that water in a day, you are still paying to heat it and keep it hot. Plus, if your power is cut off due to a power outage or storm, say goodbye to your hot water, too.

You might want to consider a tank powered by propane instead of electricity for this and other reasons.

You can expect that your water heater will need to be replaced 10-12 years after it was installed.

Traditional Water Heater Versus Tankless Cost

When considering your existing water heater replacement, make sure to calculate the cost of the new unit, as well as the monthly or yearly operating costs to determine the true cost.

Find out more about how to calculate the operating costs of a traditional water heater versus tankless.

According to the U.S. Department of Energy’s Energy Efficiency and Renewable Energy website, heaters that are tankless can be 24-34% more efficient than a tank-style water heater.

Final Thoughts

There is a lot to consider when deciding on the next water heater for your home. You need to think about your location, floor space, and ability to perform maintenance, whether you have hard water, and if the long-term savings outweigh the initial cost.

Are tankless water heaters worth it? Only you can answer this question. The answer depends entirely on your usage and what benefits are most important to you.

Read why you should schedule a propane furnace check-up before winter.