Ditch the Tank: How to Choose a Tankless Water Heater
When deciding what to consider when buying a water heater, gas or electric, several important factors should guide your decision:
- 1. Energy Efficiency
Gas water heaters typically have lower operating costs due to the lower price of natural gas than electricity. However, electric models, especially heat pump water heaters, can be more energy-efficient in the long run. - 2. Installation Costs
Electric water heaters are generally less expensive to purchase and install, as they don’t require venting. Gas models may have higher upfront costs due to the need for proper ventilation and gas line connections. - 3. Available Fuel Source
The available fuel sources in your home may limit your choice. If you don’t have a natural gas line, an electric water heater might be your only option. - 4. Space and Ventilation
Gas water heaters require proper ventilation, which can limit installation locations. Electric models are more flexible in terms of placement. - 5. Lifespan and Maintenance
Electric water heaters typically have a longer lifespan and require less maintenance than gas models. - 6. Environmental Impact
Electric water heaters can be more environmentally friendly, especially if your electricity comes from renewable sources.
Key Takeaways
- See the 10 Best Tankless Water Heaters 2024!
- Tankless water heaters save space and energy by heating water only when needed. They can be 34% more efficient for homes using less than 41 gallons of hot water daily.
- There are three main types of tankless water heaters: natural gas, electric, and propane. Natural gas units heat water fast for big families but need venting. Electric models are good for small spaces and easier to install, but they might raise your electricity bill. Propane heaters also require venting but work well with no natural gas.
- When choosing a tankless heater, consider how much hot water you use. Look at the gallons per minute (GPM) rating to ensure it meets your needs without wasting energy.
- With help from a professional plumber, pick the right size heater to ensure you have enough hot water and save energy.
- Maintenance tasks like cleaning filters and yearly checks should be considered to keep the heater running well for up to 20 years.
The quest for the perfect tankless water heater in 2024 has become even more crucial as energy costs continue to rise. Every household has unique hot water demands – from back-to-back morning showers to running multiple appliances during peak hours.
While the technical specifications might seem overwhelming, the end goal remains simple: ensuring reliable hot water exactly when needed. Modern tankless systems have evolved significantly, with the latest models offering smart home integration and enhanced energy monitoring capabilities.
Recent studies confirm that tankless water heaters now achieve up to 40% energy savings for households using less than 41 gallons daily, making them an even more attractive investment for energy-conscious homeowners. As energy prices fluctuate, these savings become increasingly significant for long-term household budgets.
Whether you’re considering a high-efficiency gas model or exploring the latest electric options, we’ll guide you through selecting the perfect size and type for your needs. With winter approaching and utility costs on everyone’s mind, there’s never been a better time to upgrade your water heating system. Ready to discover your ideal hot water solution? Let’s dive into the latest innovations!
Understanding Tankless Water Heaters
A tankless water heater provides hot water on demand without a bulky storage tank. It’s efficient, saving space and energy for your home.
What is a tankless water heater?
Tankless water heaters, also known as demand-type or instantaneous water heaters, provide hot water only as needed. They are a far cry from traditional tanks that always heat water and then heat it again, heating water directly without storage.
Modern tankless water heaters employ advanced heating technology that’s more sophisticated than ever before. When water enters the unit, it passes through highly efficient heat exchangers, where a precision-controlled gas burner or advanced electric heating elements instantly bring it to your desired temperature. This on-demand system eliminates the need for storage and reheating cycles.
Today’s systems come in three primary configurations: natural gas, propane, and electric. Gas-powered units typically offer superior performance, especially in colder climates, and can handle multiple simultaneous hot water demands more effectively. While natural gas units are ideal for homes with existing gas lines, propane models provide an excellent alternative for properties without natural gas access.
Electric models utilize high-grade copper heating elements and have evolved significantly recently. However, they may struggle to maintain consistent temperatures when multiple fixtures are used simultaneously, particularly in colder regions. The latest electric models feature advanced flow control and self-modulation technology to optimize energy consumption.
Selecting the right unit depends on two critical factors: your required flow rate (measured in GPM) and the temperature rise needed based on your local groundwater temperature. For instance, if you need to run a dishwasher (3 GPM) and shower (2.5 GPM) simultaneously while raising water temperature from 50°F to 105°F, you’ll need a system capable of handling both the 5.5 GPM flow rate and 55°F temperature rise.
Types of tankless water heaters
How to choose a tankless water heater? By choosing correctly, you can save space and reduce energy consumption. Understanding the different types will help you make an informed decision.
- Natural Gas Tankless Water Heaters—These heaters use natural gas to heat water quickly and are ideal for homes with existing gas lines. They offer high gallons-per-minute (GPM) rates, making them suitable for families needing lots of hot water simultaneously. However, they require a ventilation system to expel exhaust gases safely.
- Electric Tankless Water Heaters – Electric models are perfect for smaller homes and apartments with limited space. They cost less upfront than gas models and don’t need a venting system, but they might lead to higher electricity bills. Installation involves hooking up to your home’s electrical system and may include upgrading your electrical panel to handle the load.
- Propane Tankless Water Heaters—Like natural gas heaters, propane units provide hot water on demand using propane as their fuel source. They’re a great option if your home doesn’t have access to natural gas but still wants the performance of a gas heater. Like their natural gas counterparts, these heaters also need proper ventilation.
Each type has unique features, like energy efficiency ratings and temperature rise capabilities. Consider what best suits your home’s needs—prioritizing energy conservation with an electric model or meeting peak hot water demand with a natural gas or propane heater. Remember to check the installation requirements, like plumbing enhancements or adding a ventilation system, which could influence your final choice.
How they work
Modern tankless water heaters in 2024 feature cutting-edge heating technology activated by advanced flow sensors. When you turn on a hot water tap, the system instantly responds, using either electric heating elements or gas burners, while smart controls maintain precise temperature settings.
These systems deliver hot water at 2-5 gallons per minute, with gas units offering higher flow rates than electric models. The on-demand heating eliminates storage inefficiencies, ensuring hot water is available instantly for any household task, from showers to appliances.
Advanced heat exchangers maximize efficiency while minimizing energy use, delivering up to 40% savings compared to traditional systems. With utility costs rising, these smart, energy-saving features make tankless heaters an increasingly attractive investment for modern homes.
Key Considerations When Choosing a Tankless Water Heater
Picking the right tankless water heater means knowing what matters most for your home. Let’s explore how to make that choice with confidence and smart planning.
Determine your hot water needs
Understanding your household’s hot water demands in 2024 is crucial for selecting the right tankless water heater. Start by calculating your peak usage when multiple appliances run simultaneously. Modern showers typically use 2.5 GPM, dishwashers need 1.5-3 GPM, and washing machines require about 2-3 GPM.
To determine the ideal size, add the flow rates of appliances you’ll likely use together. For instance, running a shower (2.5 GPM) while operating the dishwasher (1.5 GPM) and kitchen sink (1.5 GPM) would require a system capable of handling 5.5 GPM. The unit must also account for your local groundwater temperature, as the necessary temperature rise affects performance. You’ll need a higher BTU rating in colder regions to achieve the desired 120°F output temperature.
Modern tankless systems now offer advanced temperature control and can deliver between 2-5 gallons per minute, with gas-fired units providing superior flow rates compared to electric models. For optimal performance, look for a unit with BTU ratings that match your calculated needs – typically 20,000 BTUs per GPM for a 40-degree temperature rise.
Choose the right size
Selecting the right-sized tankless water heater in 2024 requires careful consideration of your household’s specific needs. Start by evaluating your peak hot water usage – consider how many bathrooms are active during busy mornings and the number of family members requiring hot water simultaneously.
For modern households, sizing goes beyond just bathroom count. Today’s high-efficiency appliances have specific flow rate requirements: a typical shower needs 2.5 GPM, while newer dishwashers use 1.5-3 GPM. An undersized unit will struggle during peak usage, potentially leaving you with lukewarm water when needed most.
Consulting a certified plumber is the most reliable approach to correctly sizing your system. Professional installers now use advanced diagnostic tools to analyze your home’s usage patterns and recommend units that match both your current needs and potential future demands, ensuring optimal energy efficiency and performance.
Select the appropriate power source (natural gas, propane, electric)
After figuring out the right size for your tankless water heater, the next step is to pick a power source. Your choice between natural gas, propane, and electric will impact the unit’s efficiency, installation requirements, and running costs. Let’s look at what each option offers:
- Natural Gas Tankless Water Heaters: These units require a ventilation system to expel exhaust gases safely outside your home. They are known for higher flow rates, meaning they can heat more water faster than electric models—ideal if you have a large family or high hot water demands. Keep in mind that installing the ventilation might add to the initial cost.
- Propane Tankless Water Heaters: Similar to natural gas heaters, propane models also need venting for safety. However, they use propane stored in tanks as their fuel source. This can be a great option if you don’t have access to natural gas lines or prefer storing your fuel supply. Remember, you must monitor your propane levels to avoid running out.
- Electric Tankless Water Heaters: One of their biggest perks is that they don’t require complicated venting systems, making them easier and often cheaper to install than gas or propane options. Electric heaters are perfect for smaller spaces and have less environmental impact since no combustion is involved. However, they typically have lower flow rates and might increase your electricity bill depending on usage.
Each tankless water heater type offers distinct advantages in 2025, with the choice ultimately depending on your home’s specific requirements and energy costs. Gas models typically deliver superior performance and higher flow rates, while electric units offer easier installation but may have limited output capacity.
When evaluating long-term costs, consider that tankless systems can save up to 34% on energy for households using 41 gallons or less daily, potentially accumulating $2,400 in savings over a 20-year lifespan. Modern units now last 20-25 years, compared to 10-15 years for traditional tanks, making the higher upfront investment more justifiable.
Climate plays a crucial role in system selection. In colder regions, you’ll need a unit with a higher BTU rating to compensate for lower groundwater temperatures. For example, if your incoming water is 40°F and you need 120°F output, your system must be capable of a significant 80°F temperature rise while maintaining adequate flow rates. Professional installation remains essential, particularly for gas and propane units, to ensure proper ventilation, correct gas line sizing, and safe operation according to local codes.
Consider maintenance requirements
Modern tankless water heaters require specific maintenance protocols to maintain peak efficiency in 2024. Regular cleaning of the inlet filter and annual descaling are essential, especially in areas with hard water. Today’s units feature smart diagnostics that alert you to maintenance needs, but professional inspection remains crucial for optimal performance.
Annual professional maintenance now includes comprehensive system diagnostics, heat exchanger inspection, and verification of safety systems. These checks help prevent common issues like mineral buildup and ensure your unit maintains its energy efficiency rating. With proper care, current models can reliably operate for 20-25 years, significantly longer than traditional tank systems.
Regular maintenance extends your unit’s lifespan and preserves its energy efficiency, potentially saving hundreds annually on utility bills. Modern units feature self-cleaning cycles and advanced scale detection, but professional servicing remains key to preventing costly repairs and ensuring consistent hot water delivery. Following these maintenance protocols helps protect your investment while maximizing the benefits of on-demand hot water technology.
Condensing vs. Non-Condensing Tankless Water Heaters
Choosing between condensing and non-condensing tankless water heaters is critical in ensuring you have a system that meets your home’s hot water needs efficiently and cost-effectively. Here’s a detailed comparison to help guide your decision:
| Feature | Condensing Tankless Water Heaters | Non-Condensing Tankless Water Heaters |
| Efficiency | Approximately 10% more efficient than non-condensing models. | Less energy efficient compared to condensing models. |
| Exhaust Temperature | Cooler exhaust allows venting with PVC pipes. | Hotter exhaust requires metal venting. |
| Initial Cost | Typically more expensive to purchase. | Less expensive upfront compared to condensing models. |
| Operating Cost | Lower operating costs due to higher efficiency. | Higher operating costs. |
| Venting and Installation | More flexible installation options due to cooler exhaust. | May require more complex venting solutions. |
In 2025, deciding between condensing and non-condensing tankless water heaters involves weighing immediate costs against future savings and efficiency. While condensing units command a higher initial investment of $1,400 to $5,600, they achieve impressive efficiency ratings of up to 96% UEF and lower operating costs through their advanced dual heat exchanger technology.
Non-condensing models attract budget-conscious buyers with their 25% lower purchase price. Still, their simpler single heat exchanger design leads to higher energy bills and requires more expensive metal venting materials due to hotter exhaust temperatures. Your choice should factor in long-term residence plans, available space, and local energy costs to determine which technology best suits your household’s needs.
Other Factors to Consider
Finding the best tankless water heater is not just the type you decide upon. It involves knowing if the type or size is one that you should consider installing in a particular place and whether you will need specific features. Indoor vs. outdoor setups will change how they work, while DIY vs. professional grade will affect longevity and durability.
How does professional installation save you time in setting up your system and possibly some of your money? It also helps save the environment from your hard-earned money through energy efficiency.
Indoor vs. outdoor installation
Indoor tankless water heaters offer superior protection from extreme weather conditions in 2025, particularly crucial as climate patterns become more unpredictable. Protected from freezing temperatures and harsh elements, indoor units typically last longer and maintain peak efficiency, with modern models featuring enhanced freeze protection technology and smart monitoring systems.
Outdoor installation, while space-saving, presents a different set of considerations. Modern outdoor units come with built-in freeze protection up to -30°F and weather-resistant casings, making them viable even in harsh climates. Their ventless design simplifies installation and reduces costs, but the location must be carefully chosen to balance accessibility with protection from severe weather and potential security concerns.
Special features (e.g., DIY vs. professional installation)
Deciding to DIY or hire a professional for tankless water heater installation in 2025 requires carefully evaluating your technical expertise and resources. While DIY installation might save $500-1,000 on labor costs, modern units feature complex electronic systems, precise gas line specifications, and critical safety requirements that demand specialized knowledge and tools.
Professional installation now includes advanced system calibration, smart device integration, and compliance with updated building codes. Certified installers use digital diagnostic tools to optimize performance and can properly size gas lines and venting systems. Most manufacturers now require professional installation to maintain warranty coverage, which typically protects your investment for 12-15 years.
The true value of professional installation extends beyond the initial setup. Certified installers provide detailed documentation for warranty purposes, ensure compliance with local regulations, and often include ongoing maintenance plans. When considering the average $3,000 investment in a tankless system, professional installation helps protect your investment and ensures optimal performance and safety.
Energy efficiency
The latest 2024 data shows tankless water heaters achieving impressive energy efficiency gains of up to 40% compared to traditional storage tanks, with the EPA confirming savings of 34% for households using 41 gallons or less daily. This translates to substantial utility bill reductions and decreased environmental impact over the unit’s extended 20-25-year lifespan.
Modern tankless systems now feature advanced flow control technology and smart monitoring systems that optimize performance based on usage patterns. When selecting a unit, focus on models with appropriate GPM ratings for your household needs – typically 2.5 GPM for showers and 1.5-3 GPM for dishwashers.
With enhanced efficiency features like dual heat exchangers and precision temperature control, today’s tankless water heaters deliver consistent hot water while minimizing energy waste. Combining on-demand heating and sophisticated flow management ensures optimal performance without compromising environmental responsibility.
Final Thoughts
Choosing the ideal tankless water heater in 2025 requires careful consideration of several key factors to ensure optimal performance and efficiency. Modern households typically require 2-5 GPM capacity, with simultaneous usage demanding higher flow rates – a morning shower (2.5 GPM) combined with a running dishwasher (2 GPM) needs at least 4.5 GPM capacity.
Today’s market offers three primary options: natural gas units delivering superior flow rates and efficiency, electric models ideal for smaller spaces and areas without gas service, and propane systems providing a powerful alternative where natural gas isn’t available. Each type now features smart home integration, advanced flow sensors, and precise temperature controls.
Professional installation has become increasingly critical as these systems grow more sophisticated. Certified installers use digital diagnostic tools to ensure proper sizing, optimal performance, and compliance with current building codes. Regular maintenance, including annual professional inspections and periodic filter cleaning, helps maintain peak efficiency and extends the system’s lifespan beyond 20 years.
While the initial investment ranges from $1,400 to $5,600, modern tankless systems deliver up to 40% energy savings compared to traditional tanks. With rising utility costs and enhanced efficiency features, these units typically pay for themselves through reduced energy bills and longer service life. The combination of endless hot water, energy savings, and advanced technology makes tankless water heaters an increasingly attractive investment for modern homes.
FAQs
How do tankless water heaters work?
A tankless water heater activates when you turn on a hot water tap. Advanced flow sensors detect water movement and trigger the heating system, using either electric elements or gas burners to heat water instantly as it passes through. This on-demand system eliminates the need for storage tanks and provides continuous hot water.
What size tankless water heater do I need?
Size requirements depend on your peak hot water usage. Calculate your maximum simultaneous hot water needs by adding up typical flow rates – showers use 2.5 GPM, dishwashers need 1.5-3 GPM, and washing machines require 2-3 GPM. For example, running a shower and dishwasher simultaneously requires at least a 4.5 GPM capacity unit.
How much energy can a tankless water heater save?
Modern tankless systems achieve up to 40% energy savings compared to traditional tanks, particularly for households using 41 gallons or less daily. This efficiency translates to potential savings of hundreds of dollars annually on utility bills over the unit’s 20-25-year lifespan.
How long do tankless water heaters last?
Tankless water heaters typically last 15-20 years, significantly longer than traditional tank water heaters, which last only 8-10 years. This extended lifespan is due to their durable construction using materials like stainless steel and copper and regular maintenance.
