Tankless Water Heaters: Gas or Electric? [2024]

Navigating the landscape of modern home appliances often leads homeowners to pivotal decisions, particularly when upgrading essential systems like water heaters, where operational efficiency and cost-effectiveness reign supreme. Tankless water heaters represent a significant advancement over traditional tank-based models, offering on-demand hot water and potentially lower energy bills, however, the fundamental question remains: are tankless water heaters gas or electric? The U.S. Department of Energy provides guidelines for energy efficiency that homeowners should carefully consider when making their choice, because the installation of gas units typically necessitates a connection to a natural gas line or propane source, while electric models require adequate electrical capacity in the home's electrical panel, often managed or inspected by entities like the Electrical Safety Foundation International to maintain safety standards. Brands such as Rinnai specialize in gas-powered tankless units, and Stiebel Eltron focuses on electric models, highlighting the diversity within the market and influencing consumer decisions based on energy source availability, installation costs, and long-term operational expenses.

Tankless water heaters, also known as on-demand water heaters, represent a significant departure from traditional tank-based systems. Their core distinction lies in their operational mechanism: heating water only when it's needed. This fundamental difference translates into several key advantages that are making them increasingly popular among homeowners.

The On-Demand Heating Concept

Unlike conventional tank water heaters that maintain a reservoir of heated water at all times, tankless units activate only when a hot water tap is turned on.

When a demand for hot water is detected, a powerful burner or electric element ignites, rapidly heating the water as it flows through a heat exchanger.

Once the tap is closed, the unit shuts off, consuming no energy until the next demand arises.

This on-demand functionality is the defining characteristic of tankless water heaters.

Tank vs. Tankless: A Key Difference

Traditional tank water heaters constantly cycle to maintain a set temperature.

This means they expend energy even when no hot water is being used, leading to standby heat loss.

Tankless water heaters eliminate this standby loss entirely.

They provide hot water only when needed, making them a more energy-efficient option in many households.

Key Benefits of Tankless Water Heaters

Tankless water heaters offer several notable benefits:

Energy Savings

One of the most compelling advantages of tankless water heaters is their potential for energy savings.

By heating water only when it's needed, they significantly reduce energy consumption compared to traditional tank systems.

This can translate into lower utility bills over the lifespan of the unit, offsetting the higher upfront cost.

Unlimited Hot Water

Tankless water heaters can provide a continuous supply of hot water, regardless of demand.

You'll never run out of hot water in the middle of a shower.

As long as the unit's capacity matches the flow rate of your fixtures, you can enjoy an unlimited supply.

Space Efficiency

Tankless water heaters are significantly smaller and more compact than their tank-based counterparts.

This space-saving design makes them ideal for homes with limited storage space.

They can be mounted on a wall or even recessed, freeing up valuable floor area.

Tankless water heaters, with their promise of on-demand hot water, come in various forms.

To make an informed decision, it's crucial to understand the distinctions between gas and electric models, as well as the differences between point-of-use and whole-house systems.

Exploring the Different Types of Tankless Water Heaters

Choosing the right tankless water heater involves understanding the nuanced differences between power sources, venting requirements, and application scales.

Gas Tankless Water Heaters

Gas tankless water heaters are powered by either natural gas or propane.

These units are often favored for their high heating capacity and ability to deliver significant flow rates suitable for whole-house applications.

Fuel Sources

The choice between natural gas and propane depends largely on availability and cost in your area.

Natural gas is typically more affordable where a connection is already available.

Propane, on the other hand, offers flexibility in locations without natural gas lines but requires a separate storage tank.

Switching between natural gas and propane usually requires a conversion kit and professional adjustment to ensure safe and efficient operation.

Venting Requirements

Proper venting is paramount for gas tankless water heaters to safely expel combustion byproducts.

Direct Vent

Direct vent systems draw air from outside the building and exhaust directly outdoors, minimizing the risk of indoor air contamination.

These systems often require specific clearances and installation guidelines to ensure proper airflow and safety.

Concentric Vent

Concentric vent systems use a single pipe with two channels: one to draw in fresh air and another to exhaust combustion gases.

This design simplifies installation and can be more aesthetically pleasing.

No matter the venting system used, proper installation is critical for both safety and optimal performance of your gas tankless water heater.

Features

Advanced features in gas tankless water heaters can further enhance efficiency and performance.

Condensing Technology

Condensing technology extracts additional heat from exhaust gases, significantly increasing energy efficiency.

These models often boast higher Energy Factor (EF) ratings, translating into greater long-term savings.

Modulating Burner

A modulating burner adjusts the flame intensity based on the demand for hot water, optimizing energy use and maintaining a consistent output temperature.

This feature prevents temperature fluctuations and contributes to overall efficiency.

Gas Line Sizing

Adequate gas line sizing is crucial for gas tankless water heaters.

Insufficient gas supply can lead to inconsistent water temperatures and potentially damage the unit.

A qualified plumber should assess your existing gas line to determine if an upgrade is necessary to handle the increased demand of a tankless system.

Electric Tankless Water Heaters

Electric tankless water heaters offer an alternative to gas-powered systems, particularly in situations where gas lines are unavailable or undesirable.

Power Source

Electric tankless heaters demand significant electrical power.

They require high voltage and amperage, often necessitating electrical panel upgrades and dedicated circuits.

Carefully evaluate your home's electrical capacity to ensure it can handle the load before considering an electric model.

Electrical Wiring

Professional installation by a licensed electrician is essential for electric tankless water heaters.

Improper wiring can pose serious safety hazards, including electrical shock and fire.

Dedicated circuits and appropriately sized wiring are non-negotiable for safe and reliable operation.

Point-of-Use vs. Whole-House

Tankless water heaters can be configured for either point-of-use or whole-house applications.

The choice depends on your specific needs and hot water demand.

Point-of-Use

Point-of-use tankless water heaters are smaller units designed to supply hot water to a single fixture or a small area, such as a sink or a remote bathroom.

They are energy-efficient for localized hot water needs and avoid the heat loss associated with long pipe runs from a central water heater.

Whole-House

Whole-house tankless water heaters are larger, more powerful systems designed to supply hot water to an entire home.

They require careful sizing based on the number of occupants and the simultaneous hot water demand of all fixtures.

Understanding Performance Metrics: Flow Rate, Temperature Rise, and Energy Efficiency

Selecting the right tankless water heater requires careful consideration of its performance metrics.

Flow rate, temperature rise, and energy efficiency are the key indicators that determine whether a particular model will meet your hot water needs and operate cost-effectively.

Understanding these metrics is essential for making an informed decision.

Flow Rate (GPM)

Flow rate, measured in gallons per minute (GPM), dictates the volume of hot water a tankless heater can deliver at a given time.

A higher flow rate enables more simultaneous hot water applications, such as running multiple showers or using the dishwasher while someone is showering.

Understanding your household's peak hot water demand is critical for selecting an appropriate flow rate.

Assessing Your Hot Water Needs

To determine the necessary flow rate, estimate the number of hot water fixtures you're likely to use concurrently.

Each fixture has an approximate flow rate: showers typically require 2.0-2.5 GPM, faucets 1.0-1.5 GPM, and dishwashers 1.0-2.5 GPM.

Adding up the flow rates of the fixtures you anticipate using at the same time will give you a target GPM for your tankless water heater.

Overestimating is better than underestimating, as exceeding the heater's capacity will result in a cold water sandwich – a temporary drop in temperature when demand exceeds supply.

Temperature Rise

Temperature rise refers to the difference between the incoming cold water temperature and the desired hot water output temperature.

This metric is influenced by both the flow rate and the heating capacity of the unit.

A higher temperature rise is necessary in colder climates where the incoming water is significantly colder.

Calculating Temperature Rise

The required temperature rise can be calculated by subtracting the incoming water temperature from your desired hot water temperature.

For example, if your incoming water is 50°F and you want hot water at 120°F, you need a temperature rise of 70°F.

Most tankless water heater specifications list the maximum temperature rise at a specific flow rate.

Ensure the model you choose can deliver the required temperature rise at your desired flow rate.

Climate Considerations

In colder climates, incoming water temperatures can drop significantly during winter months.

This necessitates a higher temperature rise to achieve the same output temperature, potentially reducing the number of simultaneous applications possible.

Consider the coldest expected incoming water temperature in your area when selecting a tankless water heater.

Models with higher BTU ratings (for gas units) or kilowatt ratings (for electric units) will provide greater temperature rise capacity.

Energy Efficiency

Energy efficiency is a crucial factor in evaluating the long-term cost-effectiveness of a tankless water heater.

Tankless models are generally more energy-efficient than traditional tank heaters due to their on-demand heating, but efficiencies vary between gas and electric models and among different models within each fuel type.

Gas vs. Electric Efficiency

Gas tankless water heaters often have lower Energy Factor (EF) ratings than electric models.

However, the cost of natural gas is often lower than electricity, which can offset the efficiency difference.

Electric tankless water heaters can achieve very high EF ratings but may result in higher operating costs depending on local electricity rates.

Energy Factor (EF) Rating

The Energy Factor (EF) rating is a standardized measure of water heater efficiency.

It represents the ratio of useful energy output to total energy input over a 24-hour period.

A higher EF rating indicates greater energy efficiency.

When comparing tankless water heaters, always consider the EF rating as a primary indicator of energy performance.

Keep in mind that the EF is determined under controlled laboratory conditions, and actual energy savings may vary based on usage patterns and climate.

Installation Requirements: Codes and Qualified Professionals

Installing a tankless water heater is not a DIY project for the average homeowner. It demands careful attention to state and local building codes, plumbing standards, and electrical regulations.

Engaging qualified professionals is crucial not only for ensuring optimal performance and longevity of the unit but also for safeguarding your home and family from potential hazards.

The complexities involved necessitate a deep understanding of various codes and the specialized skills that licensed plumbers, electricians, and HVAC technicians possess.

Navigating State and Local Building Codes

Adhering to state and local building codes is paramount when installing a tankless water heater.

These codes are in place to ensure the safety and structural integrity of your home and to protect the well-being of its occupants.

Ignoring these regulations can lead to serious consequences, including fines, denial of insurance claims, and, most importantly, safety risks such as fire or carbon monoxide poisoning.

Before commencing any installation work, it’s imperative to contact your local building department to obtain the necessary permits and familiarize yourself with all applicable regulations.

These regulations can vary significantly depending on your location, covering aspects such as venting requirements, gas line sizing, and electrical wiring standards.

Plumbing Code Compliance

Plumbing codes establish the standards for safe and effective water connections, preventing leaks, contamination, and other potential plumbing issues.

A licensed plumber will ensure that your tankless water heater is properly connected to your home’s water supply, adhering to all relevant plumbing codes.

This includes using the correct pipe materials, fittings, and connections to prevent leaks and ensure adequate water pressure.

Proper backflow prevention is also a critical aspect of plumbing code compliance, protecting your potable water supply from contamination.

A plumber will install the necessary backflow prevention devices to prevent water from flowing back into your home’s water lines.

Electrical Code Compliance

Electrical codes are essential for ensuring safe and effective electrical connections, particularly for electric tankless water heater models.

Electric tankless water heaters require a significant amount of electrical power, often necessitating dedicated circuits and upgraded wiring.

A qualified electrician will assess your home’s electrical system to ensure it can safely handle the increased load and install any necessary upgrades.

This includes using the correct wire gauge, circuit breakers, and grounding techniques to prevent electrical fires and ensure the safe operation of your tankless water heater.

All electrical work must comply with the National Electrical Code (NEC) and any local electrical codes.

The Importance of Qualified Professionals

While some homeowners may be tempted to attempt a DIY installation to save money, the complexities and potential risks associated with tankless water heater installation make it a job best left to qualified professionals.

Engaging licensed plumbers, electricians, and HVAC technicians ensures that the installation is performed correctly, safely, and in compliance with all applicable codes and regulations.

Plumbers: Water Line Connections and System Setup

Licensed plumbers play a crucial role in connecting the tankless water heater to your home's water lines.

They ensure proper water pressure, prevent leaks, and install necessary backflow prevention devices to safeguard your potable water supply.

Plumbers are also responsible for properly sizing the water pipes to handle the flow rate of the new system.

Their expertise in plumbing codes and best practices guarantees a safe and efficient water connection.

Electricians: Electrical Connections and Safe Wiring

Electricians are indispensable for installing electric tankless water heaters.

They ensure the unit receives the necessary voltage and amperage, upgrading wiring and circuit breakers as needed to handle the high electrical demand.

Electricians are skilled in adhering to electrical codes, grounding the unit properly, and preventing electrical hazards, ensuring the safety and reliability of your electrical system.

Without a certified electrician, the installation can result in dangerous consequences.

HVAC Technicians: System Integration and Venting

HVAC (Heating, Ventilation, and Air Conditioning) technicians specialize in the overall system integration of gas-powered tankless water heaters.

Their expertise is vital for ensuring proper venting, which is crucial for removing harmful exhaust gases and preventing carbon monoxide poisoning.

They ensure the venting system complies with local codes and manufacturer specifications, optimizing efficiency and safety.

They can also assist with gas line sizing and connections, ensuring a safe and reliable gas supply to the unit.

These professionals may also handle combustion analysis to optimize unit performance.

By entrusting the installation to qualified professionals, you can rest assured that your tankless water heater will be installed correctly, safely, and in compliance with all applicable codes and regulations.

This not only protects your home and family but also ensures the long-term performance and efficiency of your new water heating system.

Economic Factors: Costs and Incentives

Understanding the financial implications of switching to a tankless water heater is crucial for making an informed decision. The upfront cost of a tankless system is often higher than that of a traditional tank-based water heater.

However, potential long-term savings through energy efficiency and available incentives can offset this initial investment.

This section examines the various cost factors associated with purchasing and installing tankless water heaters, as well as the rebates and incentives that can help reduce the overall expense.

Decoding Tankless Water Heater Pricing

Several elements affect the final price of tankless water heaters. These include the brand reputation, the unit's capacity to handle household demand, and any advanced technological features it may possess.

Top-tier brands known for their reliability and performance often command a premium price. Capacity, measured in gallons per minute (GPM), dictates how many simultaneous hot water applications the unit can support, influencing cost.

High-end units with features like modulating burners, smart technology integration, or enhanced safety mechanisms are generally more expensive.

Consider your hot water usage habits and desired features when assessing the price tags of different models.

Unpacking Installation Costs

Installation costs are another significant factor to consider, and they can vary considerably depending on the complexity of the job and your geographic location.

Factors that drive up installation costs include the need for new gas lines or electrical wiring, extensive plumbing modifications, or challenging venting requirements.

For gas tankless water heaters, existing gas lines may need to be upgraded to accommodate the unit's higher BTU requirements.

Similarly, electric tankless models often necessitate dedicated circuits and upgraded electrical panels. These upgrades add to the overall project cost.

The location of your home can also impact installation expenses, with urban areas typically having higher labor rates than rural areas.

Obtaining multiple quotes from qualified professionals is crucial for accurately estimating installation costs and comparing different options.

Navigating Government Rebates and Incentives

To encourage the adoption of energy-efficient appliances, various government rebates and incentives are available for tankless water heaters.

These incentives can significantly reduce the overall cost of installing a tankless system and accelerate the return on investment.

Federal Incentives

Federal tax credits or rebates may be available for qualified energy-efficient tankless water heaters. These incentives are subject to change, so it’s essential to verify the current eligibility requirements and amounts on the official government websites.

Consult the Energy Star website or the IRS website for the most up-to-date information on federal incentives.

State Incentives

Many states offer their own incentives for energy-efficient appliances, including tankless water heaters. These incentives can take the form of tax credits, rebates, or grants.

The availability and value of state incentives vary widely, so it's important to check with your state energy office or local utility company for specific details.

Some states may offer rebates based on the unit's energy efficiency rating or performance characteristics.

Local Incentives

In addition to federal and state incentives, local utility companies often provide rebates or other financial assistance for customers who install energy-efficient appliances.

These local incentives are designed to encourage energy conservation and reduce the demand on the local power grid.

Check with your local gas and electric utility companies to see what rebates or programs they offer for tankless water heaters.

These incentives may be limited in scope or availability, so it's important to inquire about the terms and conditions.

Staying Informed

Government and utility websites are valuable resources for obtaining up-to-date information on available incentives.

The DSIRE (Database of State Incentives for Renewables & Efficiency) website is a comprehensive source of information on state and federal incentives for energy-efficient appliances and renewable energy systems.

Always verify the eligibility requirements and application procedures for any incentive before purchasing or installing a tankless water heater.

These incentives often have specific deadlines or limitations, so it's important to act promptly to take advantage of them.

Technological Advancements in Tankless Water Heaters

The tankless water heater market is experiencing rapid technological evolution. Innovations are geared towards enhancing energy efficiency, user convenience, and safety. These advancements aim to address some of the traditional drawbacks of tankless systems and further solidify their position as a viable alternative to conventional tank-based heaters.

This section will explore the key technological trends shaping the future of tankless water heaters.

Smart Technology Integration

A significant advancement is the integration of smart technology into tankless water heaters. This allows for remote monitoring and control of the unit via smartphone apps or web interfaces.

Users can adjust water temperature settings, monitor energy consumption, and even receive alerts for potential issues like leaks or system malfunctions.

Smart tankless water heaters can also learn user behavior patterns to optimize performance and minimize energy waste. For example, the system might preheat water based on anticipated demand during peak usage times.

Some models are also compatible with popular smart home platforms, enabling voice control and integration with other connected devices.

Enhanced Energy Efficiency

Manufacturers are continually striving to improve the energy efficiency of tankless water heaters. Advancements in burner technology and heat exchanger design are contributing to this goal.

Modulating burners are becoming increasingly common. These burners adjust the heating output based on the actual demand for hot water, rather than operating at a fixed rate.

This precise control minimizes energy waste and ensures that only the necessary amount of heat is generated.

Improvements in heat exchanger design also play a crucial role. More efficient heat exchangers can extract more heat from the combustion gases, reducing heat loss and improving overall efficiency. The use of materials with enhanced thermal conductivity further contributes to this improvement.

Condensing technology is another key feature that boosts efficiency. Condensing units capture latent heat from exhaust gases, further increasing energy savings.

Advanced Safety Features

Safety is always a paramount concern, and manufacturers are incorporating new safety features into tankless water heaters.

Leak detection systems can automatically shut off the water supply in the event of a leak, preventing potential water damage. These systems often incorporate sensors that monitor for unusual moisture levels or flow rates.

Automatic shut-off mechanisms are also designed to prevent overheating or other malfunctions. These mechanisms can detect abnormal operating conditions and automatically shut down the unit to prevent damage or hazards.

Advanced diagnostics provide real-time system monitoring and can alert users or service technicians to potential problems before they escalate. Many units are also now including freeze protection as a standard feature.

The Future of Tankless Technology

Ongoing research and development promise even more exciting advancements in the years to come.

We can expect to see further improvements in energy efficiency, smart technology integration, and safety features.

These innovations will likely make tankless water heaters an even more attractive option for homeowners looking to save energy, reduce their carbon footprint, and enjoy a continuous supply of hot water.

So, are tankless water heaters gas or electric the right choice for you? Ultimately, it boils down to your home's setup, budget, and long-term energy goals. Weigh the pros and cons, get a few quotes, and you'll be soaking in endless hot water bliss in no time!