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Tank vs. tankless heaters: Why tankless is not always the best choice

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By Erika Rawes


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When it comes time to rent or buy a new home, or to make smart renovations toyour current home, it may feel like you have a million decisions to make. What type of flooring should you pick? What is more important to have in your kitchen: more space or nicer finishes? With all of the cosmetic choices, it’s easy to overlookpractical decisions like what type of water heater to choose.

A water heater can impact your life more than you realize, though. You probably know what it’s like to be in the middle of taking a shower, hair covered with shampoo, and all of the sudden the water turns freezing cold. If you have a large family or several roommates living under one roof, some of you may even have to schedule showers around the hot water supply. Your water heater can also affect your utility bills, and maybe even your home storage and decor choices (“I want to use this space in my kitchen, but there’s a giant water heater located there”).

Because tankless water heaters — including the Heatworks Model 3 — are known for being efficient and smaller in terms of their size, many people think tankless is always better. But, in some cases, tankless is not the best way to go, and a tank water heater isa more prudent choice, especially when there are devices likeSunnovation’s Aquanta available.Check out our guide on tank vs. tankless water heaters for everything you need to know.

Looking to upgrade your home? We’ve also put together guides outlining the best dishwashers,best refrigerators, and best dryers, along with other appliances.

Tank Storage Water Heaters

tank vs tankless water heaters 67037021  heater in bathroom

Price with installation: Varies widely depending on thetype, size, and the specifics ofyour home. Home advisor reports the average cost for a 40- to 50-gallon tank atabout $900.

Installation: Tank water heaters (or traditional water heaters) are relatively easy to install, and installation typically only takes a few hours. You generally have to install a tank water heater indoors as they cannot tolerate harsh weather conditions. People often choose inconspicuous locations like closets or garages to install them. However, in older homes especially, you may find a tank water heater in a kitchen. The tanks come in electric, natural gas, and propane models. The gas models will still work during a power outage.

Lifespan: Between 10 and 15 years

How they work: Tank water heaters typically hold between 20 and 80 gallons of hot water (around 120 degrees Fahrenheit) in a storage tank. They are fairly large and require a bit of space within your home. But, if youmanage to depletewhat is in the tank, you have to wait until your water heater produces more hot water.

According to Home Depot, the chart below can help you determine how big of a tank water heater you need for your household.

Household SizeTank Size
1-226-36 Gallons
2-436-46 Gallons
3-546-56 Gallons
5 or More56 or More Gallons

Benefits:

  • More affordable upfront cost
  • Easy installation
  • Tried and true system
  • In an emergency, you have a fresh water supply in the tank
  • You can often install an electric tank water heater without making major changes to your home’s electrical system or purchasing expensive additional equipment

Drawbacks:

  • Energy waste from “standby loss.” That is, the energyyou waste on keeping a tank full of hot water at all times.
  • Shorter lifespan
  • If the heater malfunctions, gallons of water could leak or escape from the tank
  • If you empty the tank, you have to wait for more hot water

Who should buy a tank water heater: If you have a timeline or budget constraints that prevent you from getting a tankless system, a tank heater may be the way to go. If your home runs strictly on electricity, you have to carefully consider whether going tankless is really worth it. The average household capacity is around 200 amps, which may not be enough to support a tankless electric heater. If you have gas, you have to factor in the costs of venting systems and additional gas lines.According to Energystar.gov, a tankless water heateris probably going to save you (atmost) $1,800 over the life of the system. If the extra costs of installing a tankless system are going to outweigh your potential savings,you may want to consider a tank system or a high-efficiency tank system.

The data in the chart belowfrom Energystar.gov compares theenergy and cost savings on the various types of water heaters.

Type of Water HeaterEnergy Savings vs. Minimum StandardsExpected Energy Savings Over Equipment Lifetime
High-Efficiency Tank Systems10 to 20 percentup to $500
Tankless (Gas or Electric)45 to 60 percentup to $1,800
Heat Pump65 percent (compared to electric resistance)up to $900
Solar With Electric Backup70 to 90 percentup to $2,200

Tankless Water Heaters

tank vs tankless water heaters 67037021  heater in bathroom

Price with installation: Varies dramatically depending on the type, brand, your home, andwhether you are installing a new heater or replacing an old one. According toHome Advisor, the average cost isabout $3,000.

Installation: Tankless water heaters are smaller, so they require less space in your home. You can even install a tankless unit on your outside wall. Installation can be more difficult for a tankless water heater, as you may need to upgrade your home’s electrical system to support an electric tankless unit, or you may need to run a dedicated gas line to your gas-powered unit. Depending on the type of unit, you may also need to install other equipment like new exhaust vents or new pipes.

Lifespan: 20 or more years

How they work: Tankless systems heat your water on demand using gas or electric coils. Although tankless water heaters heat water on demand, they do have output limits on their flow rate. This means, if you’re running the dishwasher, doing the laundry, and taking a shower simultaneously, your heater may not be able to produce hot water fast enough. The flow rate for tankless water heaters is measured in gallons per minute of hot water the machine can produce. Gas units typically heat water faster than electric ones.

Benefits:

  • Efficiency (you don’t have to pay to constantly keep a tank full of water hot)
  • Longer lifespan
  • Space saving
  • Tankless heaters typically offer longer warranties

Drawbacks:

  • Expensive upfront equipment and installation costs
  • May need to make major changes to your home to accommodate a tankless unit
  • In some cases, the increased upfront cost may be larger than your long-term savings

Who should buy a tankless water heater: If you have gas available in your home and you can install an optimal tankless unit without too much additional cost, a tankless unit can be a great money saver. Also, if you live in an area where most of the homes are upgrading to tankless units, it may be a good idea to do the same so your property remains in comparable condition to the rest of the area homes (from a real estate standpoint).

Point-of-use tankless heaters that go under sinks, near showers, or near washing machines can also be great options for those who live in tiny homes or RVs.


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