Water heater research

Tankless vs. Tank Water Heaters: Full Comparison

(Last Updated On: April 12, 2020)

penguin taking a shower

If you’re reading this, it’s very likely that you’re in the market for a new water heater. Whether you’re urgently replacing a model that’s just gone south, or trying to do your research in advance of upgrading, it’s a big decision to make! Your water heater is one of the most expensive appliances you’ll buy. It also accounts for 20% of your home energy usage, on average.

That’s why choosing between tankless and tank water heaters can be daunting for the average buyer. You want to make a smart decision, and have your investment pay off.

Because the average person probably doesn’t know a great deal about water heaters to begin with, we thought it would be helpful to put together a primer to explain why we’re so passionate about going tankless.

Below, we’ll explain all the crucial differences, and make our case for switching!

What’s the difference?

There’s one very obvious difference between tankless models and your old tank water heater. Tankless models have no tank. So, they’re completely different appliances. One is a hulking behemoth that takes up an entire corner of your basement/entryway, while the other hangs on the wall like a small cabinet.

Tankless water heater

The lack of the tank makes tankless models much more compact, but it also changes the way the appliance works.

A tank water heater is basically a big holding tank with a heating coil in the bottom. Water is drawn from the top, since heat rises, and the heating coil works to raise the temperature of the whole tank when new water is added. It has to run pretty much constantly in order to keep the tankful of water hot for when you want it.

Tankless water heater and Traditional Water Heater

By contrast, a tankless water heater is basically a box around a heating coil. Water passes through the heating elements, rather than surrounding them. By the time water goes from one end of a tankless unit to the other, it’s at temperature. It only turns on when you want hot water, and it doesn’t have to reheat itself

What’s all the hype about?

“Unlimited” hot water

With a traditional tank water heater, you can easily run out of hot water. We’ve all been there: you do laundry, turn on the dishwasher, then go to take a shower, only to realize that the first two have used up all the hot water. Then you have to wait for the whole damn tank to heat up again. It’s slow, and it’s not convenient.

Tankless water heaters can produce hot water for as long as you want it. They’re limited by the amount they can give you at once, but as long as you stay under their limit, they can give you hot water indefinitely. There can be a few seconds of lag between turning on the hot water and having it actually come out, but once it’s going, you have “unlimited” hot water. You can take a shower after the laundry’s just run, and still have as much hot water and as hot as you like!

So, you’re limited by the amount you can have at one time, but not by runtime. In many ways, it’s the opposite of a tank model, which will let you do as many things at once as you like, but will run out quickly and take a long time to come back to full functionality.


You save a great deal of space

As we’ve already mentioned, tankless water heaters are incredibly compact. Many of them can fit in the cabinet next to your sink, or simply mount on the wall in your basement. They’re endlessly more convenient to have in smaller homes and apartments where space is limited.


It can be less disastrous to have your water heater go wrong

While no water heater is completely foolproof, it’s a lot less of a big deal when a tankless model has a problem. A tankless model might leak, but you can just shut the water supply off. And new models have smart shutoffs if something goes wrong. Tank models can wreck a house if they decide to go south. Even if you shut off the water going to it, you’ll often have 50 gallons of water spilling out that you can’t stop.


You can save substantially on your water heating bills

Tankless water heaters are as much as 34% more efficient thank tank models, according to the Energy Department. For most households, they can produce a savings of $100 or more every year.

There’s one key reason for that: you’re not constantly heating a tank in anticipation of needing it.You only use energy when you use hot water. While tank models have certainly gotten more efficient, they produce quite substantial standby losses (per the Energy Dept.: https://energy.gov/energysaver/tankless-or-demand-type-water-heaters ).


The limitations aren’t as severe as they used to be

Even 5 years ago, the tankless models on the market were pretty limited. They could only crank out enough hot water for one thing at a time (i.e. you couldn’t do laundry and take a shower at the same time. That’s no longer the case, although low-capacity models do still require you to cut down on your multitasking. More expensive current models can supply 12 gallons per minute–as much as any home should be using at a given time. As long as you’re using shower heads and appliances that are relatively new and decently efficient, multitasking on one of these is easy!


They last as long as twice the working life of tank models

According to the Energy Department, as well as Consumer Reports, the expected lifespan of a tankless water heater is usually close to 20 years. Tank models usually last for 10-15 years, max. So, you’ll certainly pay more up front, but you’re likely to avoid the cost of a whole replacement unit.

Are there some people who are better off with tank models?

Some would say yes.

Obviously, if you can’t afford a tankless model, you don’t have much of a choice. You’ll have to stick with a tank model. However, we’d encourage you to take a long-term perspective. You’ll save substantially on water heating bills by going tankless, so it often makes sense to spend more up front to reap more in the long run. If you can’t make it work up front, though, no dice. So, price is certainly a factor.

Additionally, if you have a very large, inefficient house with old appliances and plumbing fixtures, you might not be able to make do with even a large tankless water heater. Older shower heads can use as many as 5 gallons per minute. Older faucets and appliances can also use twice or more the amount of water that current models do. In those situations, you can easily max out a tankless water heater, even by running only one thing at once.

Then again, even a tank model will run out pretty fast in those conditions. Rather than putting a bunch of money into a new tank model, we’d suggest investing in more efficient fixtures and appliances. Particularly shower heads, dishwashers and washing machines.

Not only will that allow you to use a more convenient tankless system, but it’ll drastically reduce your water usage and water heating costs. In fact, making your whole home more efficient will save you just as much again as switching to tankless. If you eliminate 50% of your hot water usage, and combine that with using a 30% more efficient tankless model, you can see that investments will quickly pay for themselves!


What’s next

Convinced? You can find our reviews and recommendations for the best tankless water heaters on the market by visiting our homepage. There, you’ll find flow rates, possible usage scenarios, and more helpful info to make finding the right unit a cinch.

Tankless Reviews was created with the goal of helping people to understand the benefits and practical knowledge related to tankless water heaters. After purchasing my very first tankless heater years back, I realised that other people needed to hear about the incredible money-saving ability of this household item, and wanted to share my lessons with you!