First of all let’s explain the differences between the two. Conventional water heaters are a tanked water heater, usually 30, 40 or 50 gallon storage tanks, with a burner unit using gas, propane or electric to heat the water to the desired temperature. A thermostat controls the burner to keep it at a certain temperature so it is ready to use when you need it. Most tanked units will provide you with about a 50-60% efficiency rating. As for hot water, your tank size will determine how many gallons of hot water you can use before it runs out and has to reheat the water. The one thing to really know is even when you are not using hot water, this tank burner is using energy to heat the water, spending your hard earned money even when you don’t want hot water.
A tankless water heater has no storage tank and only heats water when a hot water fixture is turned on. As a hot water fixture is turned on, the tankless unit fires the burner as the water passes through the heat exchanger it heats the water instantly. This requires a tremendously hot burner, almost three times the heat a standard tank burner puts off. Even with such a hot burning system the tankless unit will provide you with a 90+% efficiency rating. As for hot water, your tankless unit will offer an endless supply of hot water to multiple fixtures never running out. The one thing to know is, this unit saves your hard earned money and only uses energy to heat the water when you want it.
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A big mistake is that many people make, is they believe tankless water heaters provide instant hot water. This is totally incorrect. In both cases of tanked and tankless water heaters the water still needs to travel from the water heaters to the fixture wanting hot water. So the water in the piping system must be pushed by the hot water traveling to the fixture requiring hot water. The amount of water going down the drain before you receive hot water will depend on the distance from the hot water heater. One way to gain instant hot water is to team your tankless water heater with a Hot water recirculation system. This will provide you additional energy savings and majorly reduce your water usage.
Though the tankless water heaters purchase price is more than normal tanked water heaters, you will find that a tankless water heater will have lower operating and energy costs, which will offset its higher purchase price. Some basic things that can increase your overall tankless installation costs would be:
Your hot water usage and lifestyle will determine your return on investment. But in most cases with the correct tankless application you will be pleased with you’re over space savings, endless supply of hot water, lower energy bills and reducing your carbon footprint. Don’t forget to always ask your plumbing service company about current rebates, credits & other incentives.