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How Does a Tankless Water Heater Save You Money?


If it’s time to replace your water heater, you are probably considering your options. How much hot water does your family use? How much do the different types of water heaters cost? One of the biggest decisions to make is whether to get a tank or tankless water heating system.

While there are benefits to either choice, when it comes to energy efficiency, the tankless system definitely has the standby tank beat by a wide margin. And energy efficiency isn’t just good for the planet, it’s good for your bank account balance when it comes time to pay your utility bills.

How Tankless Systems Work

As the name implies, tankless water heaters do not use storage tanks. When you turn on the hot water at your shower or sink, a heat exchanger brings cold water up to a high temperature right at that moment, using either a gas burner or an electric heating element. This means that tankless water heaters can provide hot water at any time, with no waiting for a tank of cold water to heat up after someone has taken a shower. But it’s not limitless: a tankless water heater can only make so much hot water at a time.

Hot Water Supply and Demand

The amount of hot water a tankless water heater creates can be as little as two gallons per minute or as many as five. Tankless systems that use natural gas generally produce more hot water than those that are powered by electricity. For most average-sized households, this is plenty.

For reference, the Department of Energy estimates average household hot water use at 63 gallons per day, and the Census Bureau puts average American household size at 3.13 persons. But if your family is large or has unusually high hot water needs, you may find that there are multiple calls for hot water happening at the same time. If you often have situations where the showers are running in two different bathrooms while you are starting a load in the dishwasher, 2–5 gallons per minute just might not cut it. 

Energy Savings

The DOE offers this data on how much energy is saved by using tankless water heaters. In high-hot-water-use homes (86 gallons per day), the decrease in energy needs might just be 8–14%. But in smaller households (41 gallons per day), the decrease in energy usage could be 24%–34%. This is a huge difference, especially with the cost of both electricity and natural gas increasing all the time.

Financial Savings

Tankless water heaters are more expensive initially than tank water heaters. As you can imagine from the energy savings data, though, they are significantly less expensive to operate. Turning again to the DOE, they state that 20% of a home’s energy use is put toward heating water. Decreasing that by as much as a third could mean recovering the cost of that initial investment sooner than you might think.

And it gets even better than that. Tank water heaters are more susceptible to corrosion than tankless systems, and corrosion is usually the factor that brings a water heater’s life to an end. Because of this, tankless water heaters in Lansdale, PA can last nearly twice as long as tank water heaters, giving you plenty of time to enjoy your lowered utility bills. 

Contact Platinum Plumbing & Heating, Inc. today to schedule an appointment with our pros.

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