Tankless water heaters, also known as demand-type or instantaneous water heaters, provide hot water only as it is needed. They don't produce the standby energy losses associated with storage water heaters, which can save you money. Here you'll find basic information about how they work, whether a tankless water heater might be right for your home, and what criteria to use when selecting the right model.
Energy Efficiency
One of the first things to consider when shopping for a hot water heater is energy efficiency. The bottom line is: if it saves you energy, it saves you money. According to the Department of Energy, heating water accounts for about 18 percent of our home energy use. A more energy efficient unit may cost you more at purchase, but will save you more money in the long run. It may also qualify you for a rebate.
Tank Water Heaters vs. Tankless Water Heaters
Water heaters with a tank are the most popular. Storage tank water heaters require little maintenance and are less expensive than tankless water heaters. On the downside, they use more energy. If you don’t use that stored hot water, it cools down and has to continually be reheated.
Tankless water heaters heat water directly without the use of a storage tank. When a hot water tap is turned on, cold water travels through a pipe into the unit. Either a gas burner or an electric element heats the water. As a result, tankless water heaters deliver a constant supply of hot water. You don't need to wait for a storage tank to fill up with enough hot water. However, a tankless water heater's output limits the flow rate.
Typically, tankless water heaters provide hot water at a rate of 2–5 gallons (7.6–15.2 liters) per minute. Gas-fired tankless water heaters produce higher flow rates than electric ones. Sometimes, however, even the largest, gas-fired model cannot supply enough hot water for simultaneous, multiple uses in large households. For example, taking a shower and running the dishwasher at the same time can stretch a tankless water heater to its limit. To overcome this problem, you can install two or more tankless water heaters, connected in parallel for simultaneous demands of hot water. You can also install separate tankless water heaters for appliances -- such as a clothes washer or dishwater -- that use a lot of hot water in your home.
Other applications for demand water heaters include the following:
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