Tank or Tankless – Choosing Water Heaters

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Tank or Tankless ?

According to the U.S. Department of Energy, water heaters consume 14% to 25% of a home’s annual energy use. With multiple shower heads, and dual dishwashers on the fast track to becoming standard features in today’s homes, those percentages are likely to rise.

Choosing the best water heater for your home has become more challenging in recent years as new designs have swept the industry and rising energy costs have raised consumers’ eyebrows. Despite the advanced design of today’s water heaters, most people find themselves facing the same decision: tank or tankless ? Unfortunately for most consumers, that choice is not easy. Efficiencies and costs vary, and the cheapest water heater might be the one that puts the biggest drain on your bank account over time.

How do Tank and Tankless Water Heaters Work ?


Rinnai Tankless Water Heater

Rinnai Tankless Water Heater

The idea behind a tankless system is that it heats the water as you need it instead of continually heating water stored in a tank. Tankless heaters have been the norm in much of Europe and Japan for quite some time, but they haven’t gained popularity until recently in the United States — largely due to the green movement. If you’re a good candidate for a tankless system, you can save a substantial amount of money every year on your monthly bills while at the same time conserving natural gas. Tankless heaters also last about five to 10 years longer than a tank heater, take up much less space and provide you with an unlimited amount of hot water. On the downside, a tankless system can cost up to three times as much as a tank heater and often requires costly upgrades to your natural gas line and an expensive venting system.

Rinnai Tankless Water Heaters avoid standby loss by heating incoming water only as you need it — they’re also referred to as “on demand” water heaters for this reason. The elimination of the standby heat loss is what makes a tankless system more efficient, but we’ll get to that in more detail a little later.


  • Lower life-cycle costs
  • Endless hot water
  • Runs only when needed, offering the potential to saver energy
  • Accurate temperature control
  • Small and space saving


  • Higher up-front costs
  • Complicated installation
  • Electricity required for most models to operate
  • Can suffer freeze damage if improperly installed


Electric and Gas Water Heater

Electric and Gas Water Heater

gas water heater is nearly identical to an electric water heater, except that it does not contain the two heating elements, but instead has a gas burner at the bottom, with the chimney running up through the middle of the tank.

As cold water comes in, it remains at the bottom of the tank because it is denser than hot water. If you use the hot water faster than the heating elements can heat the incoming cold water, and if you consume all of the hot water that the tank holds, you run out of hot water in the middle of your shower. If this seems to happen too often, it could mean that the bottom heating element in an electric water heater has burned out or that your water heater is too small for your house. Or it could mean that you are taking really, really long showers.


  • Lowest up-front costs
  • Easies installation and replacement
  • Uses a wide variety of available fuels
  • Works well with recirculating systems


  • Standby heat loss
  • Can run out of hot water
  • Tanks are large and heavy
  • Higher life-cycle costs

Here are answers to some common questions:

  1. Our teenagers stay in the shower until there’s no hot water left. What can we do?You can install a Rinnai Tankless Water Heater and never run out of hot water again. Keep in mind that endless hot water comes at a cost. Once there’s no more concern about running out of hot water, your teenagers probably will stay in the shower longer. This increased usage might not be noticeable until your next bill arrives.

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