Pros and Cons of Tankless Water Heaters

California homeowners are always on the lookout for ways to optimize their energy use and reduce their monthly bills. One such method that has gained traction in recent years is the use of tankless water heaters. 

But like any technology, tankless water heaters come with their own set of advantages and drawbacks. In this article, we’ll review the pros and cons of on-demand hot water systems to help you make the best decision for your home.

What Are Tankless Water Heaters?

Tankless water heaters, also known as on-demand hot water systems, are designed to provide a consistent supply of hot water only when needed. Unlike traditional water heaters that store water in a tank and constantly heat it, tankless systems heat water directly without the need for storage. When a hot water tap is turned on, cold water flows through a pipe into the unit, where a heat exchanger heats it instantly. This ensures you won’t run out of hot water, a common issue with traditional tanked systems.

Factors Influencing the Choice of a Tankless System

  1. Daily Water Usage: One of the primary considerations when evaluating tankless water heaters is your household’s daily water consumption. If multiple water sources, like showers and faucets, are frequently used simultaneously, a single tankless system might struggle to meet the demand.

    This is where understanding the flow rate becomes crucial. Most tankless systems provide water ranging from one to five gallons per minute (GPM). For context, a high-flow shower head might use 2.5 GPM, while a washing machine might consume up to 3 GPM.

  2. Location and Climate: The efficiency of on-demand hot water systems can vary based on location. In colder regions of the United States, groundwater temperatures drop significantly during winter. This means the tankless system has to work harder, consuming more energy to heat the cold water to the desired temperature.

    The difference between the cold water entering the unit and the hot water exiting is termed ‘temperature rise.’ A larger temperature rise indicates higher energy consumption.

  3. Existing Setup: Transitioning from a traditional tanked system to a tankless water heater installation might require significant modifications to your home’s plumbing, electrical, or gas systems. These installation costs can add up, so it’s essential to get a detailed estimate from your installer.

Pros and Cons of Going Tankless


  • Energy Efficiency: One of the standout benefits of tankless water heaters is their energy efficiency. Traditional tanked systems are susceptible to standby energy losses, where heat is lost from the stored water over time. In contrast, tankless systems can achieve efficiencies between 80% and 99%, translating to tangible energy savings.
  • Longevity: While the initial installation cost of a tankless system might be higher, they tend to last longer. A well-maintained tankless water heater can serve you for over 20 years, compared to the 10-15 year lifespan of traditional systems.
  • Space-Saving: Given that there’s no need for a bulky storage tank, tankless systems are compact and can be installed in tighter spaces, offering homeowners more flexibility.


  • Flow Rate Limitations: If your household uses a significant gallon of water simultaneously, a single tankless system might not suffice. You might need to install multiple point-of-use systems or consider a hybrid approach.
  • Upfront Costs: The initial investment for a tankless water heater, especially a gas water heater, can be substantial. However, the long-term energy-saving benefits often justify the cost.
  • Installation Challenges: As mentioned earlier, transitioning to a tankless system might require significant modifications to your home’s infrastructure.

In Conclusion

Tankless water heaters offer a modern, efficient solution to the age-old challenge of heating water. Their ability to provide hot water on demand, coupled with energy-saving benefits, makes them an attractive option for many homeowners. However, it’s important to weigh the pros and cons, consider the types of water heaters available, and evaluate your household’s specific needs before making a decision.

If you’re interested in more home energy efficient solutions, and the ability to save money and power your home with clean, reliable energy, contact us for a free customized solar quote


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