Why Are Tankless Water Heaters So Costly?

Tankless installations have pick up in the last couple of years. I know from my own experience, I didn’t really understand the basic difference between tank and tankless at first. But to avoid disappoints, or maybe I should say, be prepared for adjustments, this is something that the family needs to talk about. My family now understands - tankless isn’t bad, it’s just different.

For most, taking a shower or any use of hot water means that there is plenty of hot water until the tank runs out. It all depends on the size of the tank. For a tankless home hot water heater use depends on the outside ground temperature. In the summer you may have enough capacity to take care of the family routine but come winter…

If everyone in the family understands this then there is enough water for everyone; the water is there, just not all at once. All this happens because a tankless heater is called upon to heat water from very cold to very hot in a matter of seconds. The greater the difference between these two temperatures the greater the reduction of flow at the faucet.

Talk it over. There are ways to have enough hot water with a smaller unit by making some adjustments in family habits. Having back-to-back showers can mean a less expensive unit. Doing laundry and dishes at night may also save on utility rates. Installing a small point-of-use model can be cost effective. There are other ways to trim that initial cost and make an on-demand water heater more economical.

Can We Make Tankless Water Heaters Green?

If America isn’t awake, it soon will be as the US Congress gears up for the coming energy legislation. The President has said he wants this legislation enacted as soon as possible and every group that has an interest is lining up to try to influence the outcome.

The stakes are high and the outcome will impact every corner of our life, from switching on the AC to hot showers. And so we wait to see the effect it can have on the environment, the country and the homeowner.

The estimated cost to the energy industry for carbon emissions will be $646 billion through 2019, according to Energy Bulletin’s Marianne Lavelle. This is money that will flow into the US Treasury and perhaps used to fund green energy projects.

The industries with a stake in this have already reacted by hiring more lobbyists to try to shape this legislation to their advantage. Figures from the Center for Public Integrity estimates that there are now 2,300 lobbyists employed in this attempt - more than four for every member of Congress.

Energy efficient appliances that run on electricity, like tankless water heaters and heat pumps, would benefit from green technology using clean energy as well as better efficiency.

Support for the small startup companies will pay off because that is were the new ideas are usually born. The amount of Government programs that encourage the development of new technology can be the deciding factor in how quickly this happens.

If the idea to be 100 percent carbon free electric in 10 years is real then flipping a light switch or turning on the hot water will be the dawn of power from a new breed of energy. Then on-demand hot water heaters will be truly green - saving through their energy efficiency as well as by using clean energy.

Looking for tankless water heater answers

The national conscience is beginning to turn to conservation. Global warming and rising energy costs are hot news buttons these days. One way to go green is by replacing your old water tank with a tankless water heater when the time comes. Or you could do it before warning signs; the out of the box EER drops off significantly over time.

Installing a tankless water heater comes with a new set of numbers for finding the best choice for your home. Some models are actually no more expensive than storage tank heaters; other models are more expensive, 2-3 times more.

It’s not an easy task to find the right hot water heater. There is a lot of misinformation floating around. The comparison I’ve seen thrown around a lot is that tank water heaters are the cheapest and electric tankless are the most expensive.

That can be true but it all depends on what you are comparing.
The Department of Energy, which was a good source of consumer information, has redone its site so that it is hard for the homeowner to find any useful information about tankless water heaters. The only graph I see now doesn’t even include tankless models but there is help in doing some estimates. It is worth a visit for energy saving tips and a general description of the workings of a water heater.

These are the figures that DOE once used as a benchmark.

Percent energy efficient
Electric tankless .95-.99
Electric storage .90-.95
Gas tankless .80-.85
Gas storage .60-.65

So if your concern is to be green then it looks like tankless, of course electricity comes from coal, oil, nuclear and wind. Will that ratio change in the next 10 years, it seems highly likely.

There are other good choices to remember and will be talked about later: heat pump water heaters, solar powered and something that GE will soon introduce, a hybrid.

But back to the topic: Since electric power costs more than natural gas there needs to be an equation that answers a home owner’s question, What is the best water heater for me?

For that you need to be able to compare energy cost for your local, how much water you use and installation over the life of the unit.