OK, this one has me really scratching my head.

The big green selling point has always been saving storage tank losses....why heat water when you are at work or sleeping? Save energy by only heating the water on-demand.... instantaneously, when you need it. Wow, that make great sense. Sign me up.

BUT.......

Water usage--The great selling point is an "endless supply of hot water". How is that a good "green" selling point, when water conservation should be one of our cornerstones? I own a Noritz and I can't get my kids out of the shower! I know we waste more water, as a result waste more energy heating that water, etc. And the kids are not even teenagers yet! We need a clear stopping point....cold water! And tankless units actually have a delay in firing, where it takes 10-15 seconds for the "instantaneous" to fire and start heating the water. Storage units start delivering hot water when the faucet is turned on. Of course, both units should be used with an on-demand water recirculation pump, but that will not stop my kids from taking a thirty minute shower.

Energy Savings--On the DOE website, I saw a comparison with Energy Star storage units. They claimed that the tankless units will save approximately $100-$150 per year in energy costs. That is not a huge savings, especially when you consider the possibility of long showers. I doubt they compared longer shower times for tankless units as opposed to storage units.

Costs--Tankless units costs 2-3 times more than even the best storage units, especially when you consider the need for stainless steel flues. And they are difficult to install and more to maintain. Costs must be considered in green calculations because rarely do we have an endless budget. You could buy the best, superinsulated storage unit, insulate the hot water lines, buy an on-demand recirculation pump, low flow shower heads, and CFLs for the entire house.....and probably still have cash left for other green improvements.

What am I missing?