Tankless Water Heaters are becoming more and more popular each day as an effective way to decrease the amount of electricity used to heat a home’s water thereby cutting monthly energy costs.  Also known as On Demand Water Heaters, they do as their name implies – provide you with piping hot water only when you need it.  Traditional or standard water heaters, on the other hand, work 24/7 to continuously heat water, which results in energy losses as the same water has the potential of being heated over and over again costing you more on your monthly energy bill.

With Tankless Water Heaters, water is heated only when a hot water tap is turned on and results in a continuous stream of hot water.  With a standard water heater, on the other hand, you have to wait for it to fill and heat the water when the storage unit runs out.  

There are a number of items that you will need to consider in deciding whether a Tankless Water Heater is a good option. 

Fuel Type

Both electric and gas-fired Tankless Water Heaters are available.  Gas-fired tanks can generally provide a higher flow rate than electric.  However, gas-fired may not be able to provide enough hot water if multiple demands are being placed on it, i.e., washing clothes and running the dishwasher at the same time.  See "Size and/or Number of Units" below for additional information.

Size and/or Number of Units

On average, Tankless Water Heaters deliver two to five gallons of water per minute.  Again, gas-fired tanks can generally provide a higher flow rate.  Before deciding which size unit will work for you, you need to determine what your usage will be.  Are you going to use the tank for one bathroom or an entire house?  You may find it best to install multiple units that are stringed together or it might be best to dedicate units to specific tasks such as one for the dishwasher only.  Using the handy chart below, courtesy of Tankless Water Heater Guide, can help you determine the size and/or number of units you will need. 

Energy & Cost Savings

Once you have determined your usage need, you can begin to determine your energy and cost savings.  According to the US Department of Energy, "...homes that use 41 gallons or less of hot water daily, demand water heaters can be 24%–34% more energy efficient than conventional storage tank water heaters. They can be 8%–14% more energy efficient for homes that use a lot of hot water—around 86 gallons per day. You can achieve even greater energy savings of 27%–50% if you install a demand water heater at each hot water outlet."

As you can see, Tankless Water Heaters provide a viable option for helping to cut your family’s monthly energy costs.