Introduction to Instant Hot Water Heaters

Instant Hot Water Heaters can help reducing your hot water heating costs. This step by step tutorial describes how they work, the different types and fuel sources, how to size the unit and issues associated with this technology.

What are Instant Hot Water Heaters?

Often called Tankless Water Heaters / Demand Water Heater / Instantaneous Water Heater / On-Demand Water Heater / Continuous Flow Water Heater / Point-of-Use Water Heater / Inline Water Heater / Instant-On Water Heater/ Tank Less Water Heater / Tankless Hot Water Heaters – these devices produce hot water only when there is a demand for it.

Unlike conventional water heater who pre-heats the water and then stores it for later use, a tankless water heater has no tank to store hot water. It heats the water at the moment they are needed.

How Does Instant Hot Water Heaters Save You Money?

On demand water heater saves you money in three ways:

1. With instant water heater you pay only for what you use.

Conventional storage tank water heaters pre-heat the water and store it in a tank for later use. Obviously, you always heat more water than you need because you never know in advance exactly how much water you will use, and you don’t want your hot water to run out in the middle of the shower.

With tankless hot water heater however there is no pre-heating. As water is heated on-demand, you heat exactly the amount you need. Thus you save a lot of money because you heat less water.

2. With on demand water heater there is no standby heat loss.

Conventional hot water heaters with storage tank loose energy on standby heat. Since water is pre-heated, they loose some of the heat until you use them. More so, the hot water that was not used loose even more heat until the next day.

With tankless water heater there is no standby heat loss because the water is used immediately.

3. Tankless water heaters have an average life expectancy of 20 years, twice as that of a conventional storage tank system.

Although most tankless hot water heaters cost more than conventional storage tank heaters, the return of investment period (for an average sized heater) is 2-3 years, and 5-6 years for the bigger units. This leaves you with almost 15 years of pure saving!

How much money can you save by switching to On Demand Water Heater?

That depends on how much water you use and the installation configuration. Contrary to what most people think – the more hot water you use – the lesser the saving. The reason for this is that most of the saving is on the amount of water you DO NOT heat. If you use a lot of water – you save less.

• Homes that use up to 41 Gallons daily (155 L) can expect to save 24%–34% of its water heating costs compared to conventional storage tank water heaters.
• Homes that use up to 86 Gallons daily (325 L) can expect to save only 8%–14% of its water heating costs compared to conventional storage tank water heaters.
• Homes that install an Instant Water Heater at each hot water outlet may expect bigger savings, 27%–50%.

What do these numbers mean?

• The percent annual savings of on demand water heater over a traditional tank system is (on average) 25% or $200.
• This amount ($200) is equal to the half the cost of an average mid-size tankless water heater.
  Please note: Installation costs were found to be comparable for both tank and tankless systems, ~$150.
• In addition there is the potential for Federal Water Heater Tax Credit on tankless water heaters.

Given the longer life of instant hot water heaters at 20 years versus a tank system 10 years there is the potential of saving over $2,500 over the long term.