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Community and Q&A

Tank or tankless water heater?

philliphcgroup | Posted in Mechanicals on

It appears my water heater is coming to the end of its useful life. I currently have a tank style gas hot water heater. I’ve been reading about tankless ones but get mixed reviews on whether it’s actually worth the upfront costs.

I mainly like it for the fact of having hot water on demand, however, don’t want to buy something that isn’t worth the investment (I realize I probably won’t fully break even on it). Is it worth getting the tankless?

Thanks in advance for the comments.

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  1. GBA Editor
    Martin Holladay | | #1

    Here is a link to an article that may answer your questions: Are Tankless Water Heaters a Waste of Money?

  2. Expert Member
    Dana Dorsett | | #2

    Whether it's "worth it" depends on your goals. From a simple net-present-value on fuel savings basis there's rarely a financial argument if the fuel is natural gas, but for propane, sure. But a lot depends on how you use hot water (and how much), and whether you're comfortable with DIY maintenance on them- the financial aspects get out of whack pretty fast if you're paying a pro to de-lime the thing every couple of years.

    I neither love 'em or hate 'em, and I've lived with more than one. (I'm currently heating my house with one, but in combination with a buffer tank with an internal heat exchanger for the potable hot water.)

  3. jj1 | | #3

    Hi Aaron: you may be able to achieve your goals at lower cost. I installed Niagara Earth 1.25 gpm non-aerated showerheads which reduce hot water use by 50% compared with standard 2.5 gpm models; without any diminished efficacy. Cost was under $10 each. Alternatives include the Niagara Bi Max (user selectable at 1 gpm and 1.5 gpm) and Niagara Tri Max (user selectable at 0.5/1.0/1.5 gpm); cost is $10.50 or less at If your installation happens to have sufficient available vertical drop between the shower drains and the exit sewer/septic pipe, a drain water heat recovery device such as the Power Pipe R3-84 costs less than $1000 (significantly less expensive than the incremental cost of a gas tankless according to the Minnesota study cited by Martin) at (excluding installation cost) and recovers 62% of hot water BTUs which otherwise go down the drain. This passive device has no moving parts and lasts essentially as long as the plumbing system. My Bosch Evolution Ascenta (CEE Tier listed) dishwasher uses less than 3 gallons of water per cycle while my Whirlpool front loader washer (CEE Tier 3 listed) needs only 3.5 gallons to wash each cubic foot of laundry. Both appliances are Consumer Reports superior cleaning rated. Of course, half the water used by the washer is cold rinse water anyway, and hot water is rarely necessary anyway for the occasional small load. I found that replacing a worn out appliance with a high efficiency CEE Tier 3 unit does not cost much extra.

  4. wjrobinson | | #4

    Small tank unit saves by l limiting shower times and the install cost is the lowest.

    Jan's post would cost much more to install and would not be a shower to look forward to.

  5. heidner | | #5

    A lot depends on the current location of the hotwater heater and the end use.

    I do have a tankless and I like it, but I also have solar hotwater (preheat), I'm an engineer and I over built. Pay back with solar will be 40+ years... pay back with the tankless will be... about the life of the tankless..

    Some of the reasons are your climate zone, the location of your heater and fuel choices available. If you are in an area with high gas prices (there are a few) --- but extremely cheap electrical... it could be a tough call.

    Natural gas tankless heaters may require that you alter the gas piping in the house. If the distance from the gas meter to the current heater is pretty close, it might not be a problem. If the heater is at the opposite end of the house, and you have a gas furnace, gas dryers, gas stoves... as I did... it could very well mean that changing a gas tank - means changing the gas line to a larger size such that you have sufficient gas pressure at the tankless. Remember you might be going from a 30,000 BTU/hr device to a 180,000 BTU/hr appliance.

    Tankless heaters may require outside air (depending on your preference) and that may be a pain to run. Cold winter climates can freeze up a tankless if you install it outside --- and still freeze even if installed inside; if you fail to follow the manufactures instructions to the letter. That may require freeze protection kits installed. In some cases I've seen instructions on the heaters telling the owner to drain them for the winter and not use them... huh!!! Cold air blowing back into the tankless freshair duct for extended times can result in a frozen flash heater.

    If you have long uninsulated pipe runs from the heater to the sinks and showers... the cold water plug that tankless heaters all have can be quite annoying.

    If you like natural gas, but want the high efficiency, and don't want to mess with upsizing pipes, but are willing to spend the money... take a look at some of the newer condensing tanked heaters.

    If you are in Florida, Texas, California... solar still makes sense in many of the warm southern states - and utilities are still helping with rebates... Some of those climates also work pretty reasonable for heat pump hot water heaters and roof top solarPV.

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