Hot Water Storage Systems

Water heaters can be a costly investment for homeowners or investors. This is the reason why, when it is time to equip your new home with a water heater, or replace and old one, it is important to consider cost, efficiency, and longevity of the unit. We’ve put together the comparison of storage water heaters vs tankless water heaters to help homeowners and contractors decide on the type of the storage unit that is best for them. We’ll examine the pros and cons of tankless water heaters and traditional storage water heaters to enable informed decision making.

What Is a Tankless Water Heater?
Tankless water heaters, also known as on-demand water heaters, use high-powered burners to rapidly heat water as it runs through a heat exchanger and deliver it directly to the faucets or shower without storing it in a tank. Tankless water heaters are usually powered with electricity or gas. These types of water heaters were found to be 22 percent more energy efficient on average than the gas-fired storage-tank models in tests conducted by Consumer Reports.

How are “Traditional” Tank Storage Water Heaters Different?
Storage tank water heaters are commonly found in most homes. Their components are insulated tanks, typically holding 30-50 gallons of water, to heat and store the water until it is needed. A pipe emerges from the top to deliver hot water to its destination; the kitchen, the bathroom, the laundry, or other sinks.
Typically, there are storage-tank water heaters that use either natural gas or electricity for their fuel. Natural gas storage-tank water heaters use almost 50 percent less energy, costing less to operate, than the electric variety. However, they cost a bit more than the electric models. They also feature a temperature and pressure-release valve that opens when either temperature or pressure exceeds preset levels.
Tankless Water Heater is known for its Energy Efficiency.
Homeowners with on-demand (tankless) water heaters that use 41 gallons of hot water or less each day, enjoy between 24 and 34 percent more energy efficiency than storage tank water heaters. For a heavier use of hot water daily (around 86 gallons), there is additional energy efficiency in the range of 8 to 14 percent.
However, purchasing a tankless water heater system costs a little more than the traditional storage tank water heater. Moreso, tankless water heater varieties last longer than conventional water heater models, which translates to a 20+-year useful life, as compared to storage tank types which last only 10 to 15 years before self-destructing, possibly resulting to flooding.
It would have been ideal to install a tankless water heater at each hot water outlet. Doing this would result to energy savings of 27 to 50 percent.

Pros & Cons of Tankless Water Heaters
Since there are no perfect products (tankless water heaters are no exceptions), there are good points and downsides to on-demand water heaters, too.
Tankless Water Heater Advantages:
• Saves money over time.
• According to Energy.gov, “For homes that use 41 gallons or less of hot water daily, demand (or tankless) water heaters can be 24% to 34% more energy efficient than conventional storage tank water heaters.” Tankless water heaters (if gas-fired) will save homeowners over $100 annually the longer they remain in service. Electric tankless water heaters still save homeowners around $44 per year according to the US Department of Energy.
• Tankless water heaters have longer useful lives than storage tank water heaters. They typically last 20 to 30 years, double the forecasted useful life of a conventional storage tank water heater. Worthy to note though, that “hard water” areas have the potential to reduce the useful life of both types of water heaters.
• Tankless water heaters do not consume the space of a storage tank water heater. On-demand water heaters are small and may be installed in “tight quarters.” They can even be installed on outside walls if your home is terminally space-challenged.
• Tankless water heaters will supply hot water whenever you need it. You won’t have to wait even 15 to 25 seconds for your water to become hot, as tankless water heaters deliver two to three gallons of hot water per minute. Many storage tank water heaters take longer to heat water, because of the larger volume of water they must heat than most tankless types.

Drawbacks of Tankless Water Heaters:
• Higher purchase cost than storage tank water heaters.
• Tankless water heater installation can be costly if you’re replacing a storage tank water heater with a tankless-type water heater.

• When you choose to retrofit a tankless water heater in place of a storage tank variety, your plumber-installer will take more time, increasing the installed cost of replacing a storage tank water heater because of the complexity of relocating existing piping.
• Tankless water heaters can be “output challenged.” Simultaneously taking showers and doing laundry, for instance, can cause your tankless water heater to fail to keep up with the hot water demand on it. If you have multiple showers in use in your home, you often will have one of the shower-takers endure a “chilly” experience.

Pros & Cons of Storage Tank Water Heaters:
(Tank) Water Heater Advantages:
• Storage tank water heaters have lower initial cost by a significant margin.
• Storage tank water heaters operate simpler than tankless varieties, resulting in less costly maintenance and repairs.
Their simplicity makes for easy, low-cost repairs when these water heaters are not functioning properly. Tankless water heaters are more complex and expensive to repair and, obviously, replace.

Drawbacks of Storage (Tank) Water Heaters:
• They have somewhat higher utility bills.
• Since storage tank water heaters heat, then reheat water to pre-set temperature. Irrespective of what your hot water needs happen to be, they increase your utility bills.
If these water heaters function in a cool environment (location), they’ll work harder, driving your gas or electric bills higher during the winter.
• They occupy more space than the on-demand water heaters because of their size. If your home is space-restricted, you’ll have a challenge finding enough area to locate your storage tank water heater. Also, they cannot be located outside the home like tankless water heaters.
• You don’t want to be the last family member to take a shower.
If you have a typical home water heater, you might want to upgrade to a larger one if you often have multiple showers taken. While this option may relieve the hot water shortage, your energy bill will increase along with your hot water availability. Average storage tank water heaters can only support three showers simultaneously.
• Storage water tank heaters need to be replaced more often than tankless water heaters. Since storage tank types have a shorter useful life (about ½ the life of on-demand water heaters), typically 10 to 15 years, you may need to buy and install them almost twice as often as tankless water heaters, reducing your purchase savings.


Summary
If your bank account can manage the higher initial cost of a tankless water heater, you’ll save more money over time by choosing tankless. If you are on a fixed modest income, a storage tank water heater might make more sense. Discuss the two types of water heaters with your plumber to weigh your options before you begin.

Professional Perspective:
Tankless vs. Tank Water Heater: What Kind Should You Buy?
Tankless water heaters and tank water heaters both heat water for kitchen, bath, or laundry use, but they do so with fundamentally different methods.
Tankless water heaters heat the water as soon as the tap is turned on. Tank water heaters heat the water in advance in a large storage tank. Tankless water heaters are more energy efficient, but tank water heaters are more economical and easier to install.

Tankless Water Heater
A tankless water heater uses either gas or electricity to heat water as it passes through the heater. The heating source consists of two heat exchangers located in the center of the water heater. Tankless water heaters are sometimes called on-demand, instant, or instantaneous water heaters.
Tip
Point-of-use water heaters are a subtype of tankless heater installed directly at specific hot water outlets (like showers). Both types of water heaters are tankless. The difference is that a point-of-use water heater is located at each hot water delivery point, providing instant hot water.
Tank Water Heater
A tank water heater, sometimes called a storage water heater, uses gas or electricity to heat water in a 20-. 40-, 50, 55-, or 80-gallon tank. The heating source is located at the bottom of the tank. The water is heated much like a pot of water is heated on a stove.
The water is kept constantly hot. When hot water is used, new cold water enters the tank and the heating source automatically activates. When the water has reached the set temperature, the heating source turns off.
Tankless Water Heater Vs Storage Tank Water Heater
Performance Quick, steady flow Large, fast amount of flow
Efficiency 14% to 34% more Moderate if insulated.
Maintenance Flush and descale Flush and check T&P valve
Lifespan Up to 20 years 8 to 12 years
Installation Difficult Simpler
Cost $1,200 to $4,250 $975 to $2,400
Appearance Slim and compact Tall and bulky
Performance:
Tankless Water Heater:
Tankless water heaters generally have a flow rate of 2 to 5 GPM. For gas tankless water heaters, a 5 GPM unit is needed to raise the water temperature by 70ºF. Electric tankless water heaters are slower, at about 2 GPM for the same temperature rise.
Unless the tankless water heater happens to be a point-of-use demand heater, it delivers hot water throughout the house as fast as a tank water heater.

Tank Water Heater:
Tank water heaters put out a lot of hot water at a fast rate. A 50-gallon, 50,000 BTU gas-fired tank water heater can deliver up to 80 gallons of hot water in the first hour.
Because tank water heaters are located remotely from the delivery point, it takes a while for the hot water to travel to the delivery point. Depending on the size of the house, the configuration of the plumbing, and the distance between the water heater and delivery point, this can take anywhere from a few seconds to several minutes.
Best for Performance:
With either a tankless or a tank water heater, you won't necessarily get hot water the moment you turn on the tap. It can take just as long for hot water from a tankless system to reach the delivery point as with a tank water heater.
A tankless water heater moves the water slowly through its heat exchanger to heat it. By contrast, a tank water heater's water is already hot, plus it's ready to be delivered out of the tank—no circuitous path through a heat exchanger.
Energy Use and Efficiency:
Tankless Water Heater:
Tankless water heaters are up to 34-percent more energy-efficient than tank models in homes that use less than 41 gallons of water per day.
They are less efficient for homes that use more water per day: up to 14-percent more energy-efficient than tank models for homes that use 86 gallons of water per day.
Tank Water Heater:
Tank water heaters heat water to a set temperature point and then turn off when the water reaches that temperature. The heater holds the water at that temperature all throughout the day and night by continually turning on and off as needed. This means that hot water is kept at-ready when no one is using water—even during long periods.
Tank water heaters are internally insulated. You can also wrap inexpensive water heater insulation over the tank. Like a coat for your water heater, it adds up to R-10 insulating values.
Tip
Turn down your water heater to between 120°F and 140°F. Not only does this save energy but it also reduces the chance of scalding. When you go away for a long period, turn down the water heater to its lowest setting or you can even turn it off.
Best for Energy Use and Efficiency:
Tankless water heaters are more energy-efficient than tank water heaters by as much as 34-percent.
Maintenance:
Tankless Water Heater:
For a system that works several times a day, water heater maintenance is important to keeping the heater in its best condition and for energy efficiency.
Tankless water heaters can be maintained by the owner by cleaning the inlet filter and the air filter, inspecting the water heater, and descaling and flushing the unit.
Tank Water Heater
Tank water heaters are largely self-maintaining. Once a year, the water heater should be flushed and cleaned as heavy sediment builds up on the bottom of the tank.
Occasionally, the T&P valve on the side of the water heater should be tested to make sure that it can drain pressure and water.
Best for Maintenance:
Tankless and tank water heaters require roughly the same amount of maintenance.
Lifespan:
Tankless Water Heater:
A tankless water heater can last up to 20 years, if well-maintained.
Tank Water Heater:
A tank water heater will last from 8 to 12 years, depending on the level of maintenance.
Best for Lifespan:
A tankless water heater can last up to 150-percent longer than a tank water heater.
Tip
It's probably time to replace your tanks water heater if leaks have developed from the tank. Tanks cannot be repaired, but fittings to and from the heater can be tightened or repaired. Foul-smelling water, discolored water, and banging or rumbling that isn't cured by flushing may also indicate the need for replacement.
Installation:
Tankless Water Heater:
A licensed plumber and/or electrician should install a tankless water heater. A tankless water heater may require new gas lines, since conventional tank water heaters may have 30,000 BTU/H lines, with tankless units requiring three or four times that amount (30,000 to 130,000 BTU/H).
Tank Water Heater:
Nearly every plumber can install a tank water heater. Do it yourselfers with intermediate plumbing experience, too, can install a tank water heater, further lowering the cost.
Water heaters must be installed in accordance with local codes and utility company requirements, and permitting and inspection are usually required.
Best for Installation:
A tank water heater is easier for installation than a tankless water heater. Tank water heaters are standard in most homes, so it's an easy exchange of a new one for an old one. The space is already reserved for a tank water heater, so it's not necessary to find or carve out a new space.
Cost:
Tankless Water Heater:
A tankless water heater costs from $1,200 to $4,250 to install. Converting from a tank water heater to a tankless water heater will cost more.
Much of the cost of a tankless water heater depends on the cost of the unit itself, as they can range from $400 to $1,200.
Tip
The best tankless water heater heats only as much water as is needed: no more, no less. It strikes a balance between rapid but efficient flow rate, temperature control, ease of installation, and energy efficiency.
Tank Water Heater
A tank water heater costs from $975 to $2,400 to install. Tank water heaters are prevalent and are found in a wide range of prices.
Best for Cost:
A tank water heater costs about half as much to purchase and install than a tankless water heater.
Appearance:
Tankless Water Heater:
Tankless water heaters are relatively small, flat, and wall-mounted. Even a high-capacity 11 GPM (gallons per minute) tankless water heater is just 27 inches tall and 19 inches wide, with a projection of about 12 inches.
Tank Water Heater
Tank water heaters have a characteristic tall, cylindrical appearance. The tank is about 60 inches high and between 20 and 24 inches in diameter.
Not only are tank water heaters large but they also require at least three inches of side clearance, 12 inches of top clearance, with more space being preferred.
With a top vent, expansion tank, T&P valve, and drain pan added, a tank water heater is bulky unit.
Best for Appearance
Tankless water heaters are slimmer and more compact than tank water heaters.
Tankless vs. Tank Water Heater: How to Choose
Shedding the huge, bulky tank means that tankless water heaters tuck away far better than conventional tank water heaters, making them a good choice for small- or medium-size homes.
Tankless water heaters are also a good choice for homes with lower hot water demands since most of the energy savings are realized by homes that use less than 41 gallons of water per day.
Tank water heaters are economical to purchase and install. They do use more energy than tankless heaters but they can reliably deliver hot water in large quantities.

• Which is better, a tankless or tank water heater?
A tankless water heater and a tank water heater are best for different types of homes. A tankless water heater is best for smaller homes and for owners who can afford the higher up-front installation cost. A tank water heater is best for homes where it's important to save money on the unit and on the installation.
• Is it worth switching to a tankless water heater?
It may not be worth it to switch to a tankless water heater if new gas lines need to be installed to accommodate the increased energy demand of the water heater. But it may be worth switching if long-term energy efficiency is a concern.
• Can you replace a 50 gallon water heater with a tankless water heater?
You can replace a 50-gallon water heater with a tankless water heater that has a higher flow rate, such as a 5 GPM tankless heater model.