Your water tank can eat up a lot of your home’s energy budget—heating water accounts for up to 30% of the average home’s energy bill. For this reason, you want your water heater to be as energy efficient as possible and many Canadians are making the switch to tankless water heaters. Tankless water heaters not only provide you with instantaneous hot water as soon as you turn on your tap, but they can also bring you huge energy savings. What’s all the fuss about and how do they work? Below you’ll find quick overview of the most important similarities and differences between a regular hot water tank and a tankless water heater so you can find out which unit is right for you.

How They Work

Traditional tank-type water heaters keep hot water in large, cylindrical tanks that use either electricity, natural gas or propane to heat the water inside. When you turn on the hot water tap, water flows from your tank (which is already filled with hot water) to the faucet. Standard hot water tanks range from 40 gallons up to 60 gallons and can easily handle simultaneous usage.

Gas tankless water heaters, on the other hand, require no water storage tank at all as they use high-powered burners to heat water on demand as it passes through a heat exchanger. These tankless heaters come to life when you open the faucet, which immediately lets the system’s computer know to fire up the burners and start the exhaust fan. The cold water then goes through these burners in a series of small water channels (heat exchangers) which heat the water quickly to a predetermined temperature which is also monitored by the computer and then is sent to the open faucet. When the faucet is closed, the sensor notifies the computer which then shuts down the burner and goes back in to sleep mode until the next time hot water is needed.

Energy Efficiency

As we’ve learned, the biggest difference between the two water heaters is the heating process itself, and that is the biggest factor affecting efficiency. Since tankless water heaters heat water on the spot, they require lots of energy in small spurts to heat the water when you need it. On the other hand, typical hot water tanks rely on storage and after usage require 30-40 minutes of recovery to heat the water again. Is it more efficient to heat the water instantly or is it better to gradually heat the water in the tank beforehand? The answer is that it depends.

Since tankless water heaters require high amounts of energy sporadically, the typical heater runs at around 199,000 BTU. On the other hand, regular hot water tanks run from 50,000 BTU to 70,000 BTU, but that doesn’t necessarily mean that they use less energy. Tankless units are energy efficient within the unit themselves and have efficiency ratings from 80-97%. This means that during the short time they are switched on, much less heat is lost due to inefficiency in comparison with regular tanks. Studies have shown that tankless heaters are 22% more energy efficient than gas-fired storage tank models. So, even if your tankless unit requires more energy to run than your regular storage tank, it runs much less frequently and will use less energy in total.

Other Considerations

Aside from energy efficiency, the pros and cons of tankless and regular storage water heaters can also be evaluated in terms of the appearance of the unit, consistency of water temperature and upfront cost. The cost of purchasing or renting a tankless unit is higher than that of a regular water tank and the installation process is different as they require upgraded gas pipes and proximity to electrical outlets for their fan and electronics.

In addition, tankless units can come with what is known as a “cold water sandwich”: momentary spurts of cold water when you turn on your tap due to lingering cold water in your pipes while the unit is firing up. Most tankless water heaters do, however, work to reduce the “cold water sandwich” by measuring the length of time between the last hot water usage and the current hot water request. If the time is short enough, the tankless unit will fire up within seconds to reduce the amount of cold water coming at you.

In terms of space, tankless units are undoubtedly more space-efficient than regular storage water heaters and can be hung up on the wall rather than being installed on the ground. Many people are switching to tankless units as they can be installed in smaller spaces and take up less room, offering more convenient installation in addition to increased energy savings. If you are convinced that a tankless system is right for your situation, or if you simply want to upgrade your regular storage tank, get a price quote for installing a new hot water heater in your home with EcoLife.

5 thoughts on “Top Differences Between a Hot Water Tank and a Tankless Water Heater

  1. From what I got the tankless water heaters are very good at giving you hot water on demand. It sounds like it would be a lot of money to get the tanks because you are paying it in electricity. The nice thing is that you would have hot water all the time.

    1. Thanks for your comment, Charles. Tankless heaters do cost more upfront for the unit, but they actually use less electricity overall because they only fire up when you need them (as opposed to hot water storage tanks which are constantly heating the water in the tank).

  2. I did not realize that tankless water heaters required so much energy in order to run. It seems like there are a lot of pros and cons to both. Even though it would take more time to heat up the water using a tank, it would at least save energy, and saving energy, would save money.

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