Pros & Cons of Tankless Water Heaters

Pros & Cons of Tankless Water Heaters

Technology driven appliances are enticing, especially when you are in need of a replacement water heater or are looking to save energy. If you are a homeowner interested in energy efficiency or space saving appliances, then a tankless water heater may be the right choice for you. Consumer Reports states tankless water heaters are roughly 22% more efficient than water heaters with tanks. But, there’s more to learn. 

With any home appliance, it’s important to conduct research before making a major purchase. Tankless water heaters are not always worth the hype. There are additional costs and lifestyle considerations that should be a part of your decision. Let’s uncover the pros and cons of a tankless water heater.

What is a tankless water heater?

Tankless water heaters are also called demand water heaters because of the way they function. Instead of a storage tank, like a conventional or storage tank water heater, a tankless water heater heats only the water that flows through the unit on demand. 

Energy Efficiency

Going green is a positive choice for the environment and your health. Efficient use of resources is often a driving factor to choosing a tankless water heater. The on demand function means you will only use the power source and water when you need it. A conventional water heater is on all the time to keep 40+ gallons of hot water on the ready. 

The professionals at This Old House state, “These are the arguments for investing in a tankless water heater. It generates hot water only when you need it—and for as long as you need it—saving 27 to 50 percent of fuel costs over tank-type heaters. (A typical gas-fired tank wastes 40 to 50 percent of the fuel it burns.)”

This savings is returned to you in $100- $150 off your yearly energy bill. Moreover, tankless water heaters that use propane gas emit approximately 50% less CO2 emissions than water heater tanks, which will help reduce your carbon footprint. 

Even more, when it’s time to replace your water heater the tankless unit has a much smaller physical footprint than a large rusty tank in a landfill.


A common myth is that tankless water heaters are simply hooked up to a water and power source with little effort to install. This is true in some cases with electric water heaters, but most often installation involves changes to piping and venting. 

Most tankless water heaters are not “plug and play” and installation may require more upfront costs. Understanding this ahead of time will also factor into the lifetime savings of switching to a tankless water heater. For a gas or propane tankless water the proper installation with regard to the piping, meters and venting is critical. Electric models are typically cheaper and easier to install than gas. 

No matter what type of water heater you select, it’s a good idea to have a licensed professional like your trusted plumber complete the installation.


It’s no secret the initial cost of a tankless water heater can be higher than a conventional model. For all types of water heaters, conventional or tankless, there are many brands with different warranties at different price ranges. A good rule of thumb with any major appliance purchase is to consult a licensed professional. A plumber will be familiar with brands, warranties and installation specifications.

The average cost of an electric tankless water heater is $500-$700, while a gas model costs $1,000-$2,000. After purchase, most units are eligible for an Energy Star rebate. In fact, rebates can be up to $300.

Beyond the cost of the unit, budget the cost of ownership during the water heater’s lifespan. This includes installation, rebates, energy savings and maintenance. In many situations, this makes a tankless water heater the most sensible option.


Maintaining a water heater is an important part of extending the life of the unit. Tankless water heaters outshine storage tank water heaters with a longer lifespan and less maintenance needs. By design there is no storage tank in a tankless unit, leaving one less opportunity for leaks and ruptures, and no sediment build to be removed.

Tankless units have a lifespan that is about twice that of storage tank units and typically carry a longer warranty. Your tankless unit could last 20 years with a 15 year warranty where most storage tank units last 10-12 years.  

Scale and build up may cause a tankless water heater to stop functioning well before its estimated lifespan. If you have hard water, you may need a water treatment system to avoid these issues. A water treatment system will resolve more than your water heater issues and is a great investment for any home. 


The most noticeable difference between a tankless and conventional water heater becomes evident in daily usage. With a tankless unit, you probably cannot use multiple hot water appliances at the same time. For instance, if you want to run a shower and a dishwasher at the same time there may not be enough hot water generated at once for both uses. Tankless water heaters are better suited for homes with 1-2 residents or part time vacation homes. If your normal routine includes 3-4 people showering for work and school in the morning, then a larger conventional unit is a better option for you. 

Additionally, if you have a home with scale build up in pipes, the tankless water heater may not give you the rate of flow you would like. This is especially true in older homes or homes with untreated hard water.

Speed & Ease of Use

While a tankless water heater heats on demand and takes seconds to create hot water, the time to deliver hot water really depends on the distance from the water heater to the fixture. Tankless water heaters are more compact and it’s more likely they can be located closer to the point of use, like a bathroom. 

Tankless units are quite easy to use. Most units are operated remotely and send an alert when maintenance is needed. For a conventional unit, changes are made at the storage tank and maintenance is not planned.

If you are considering a new water heater, contact  the plumbing professionals at Hague Quality Water of Maryland for more information. In most cases, we can provide a free estimate and complete the work during the same visit. If you prefer to start an estimate online, get started today on our website.


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