Tankless Water Heaters

Tankless (on-demand) water heaters

Tankless water heaters have a longer average lifespan of about 20 years, and even at that point can often be repaired so they last even longer. Their extra efficiency comes primarily from not having to store hot water when it's not needed. They can also provide useful backup to solar water heaters and can boost tank-style water heaters during peak periods of use.

Reviews say the gas tankless water heaters that keep pilot lights lit all the time aren't very efficient, but quite a few gas models automatically relight their pilot lights when a faucet is turned on and they need to start heating water. Some of these whole-house tankless water heaters have EF ratings of 0.82 or higher; these are Energy Star-rated and qualify for federal tax credits. Most electric tankless water heaters are point-of-use water heaters designed to supply hot water to just one or two faucets at a time (see below).

Tankless water heaters also save space and if sized correctly provide unlimited hot water even during peak periods. Installation can be expensive, however, since you may need upgrades to pipes and additional electrical work. Reviews suggest calculating energy savings very carefully, using your local rates, to find out how long it will take to pay back the initial cost of the water heater its installation. You're more apt to find tankless water heaters a good buy if you're building a new home. According to calculations by Consumer Reports, the payback for going tankless is about 20 years when compared to a standard storage water heater.

Tankless water heaters get quite mixed reviews from owners, partly because of unrealistic expectations (and advertising) and partly because they're really not a good solution for all homes. If the groundwater is colder than the U.S. average of about 50 degrees Fahrenheit, the tankless water heater may have trouble heating it fast enough, decreasing output below an acceptable flow rate.

Proximity to the points of use is also important, since the water can cool too much if it travels too far to reach a faucet. For this reason, reviews say it's often more satisfactory to use more than one small tankless water heater -- one for the kitchen, one for the master bathroom and a third for other bathrooms -- instead of a series of units in a row or one big one for the whole house.

Owners also report problems with hot water "sandwiches" that intersperse bursts of cold water between bursts of hot -- extremely unpleasant when taking a shower! Sometimes this is a maintenance problem. Tankless water heaters do require frequent maintenance, especially when heating hard water. Fine Homebuilding recommends avoiding this problem by adding a circulating pump to keep hot water continuously in the lines. This also prevents another problem common to tankless water heaters -- wasting a lot of cold water while waiting for hot water to reach the faucet. (Circulating pumps can also be a valuable addition to a tank-style water heater.)

Reviews say it's important to consult with a professional contractor who's experienced with tankless water heaters before choosing one. Each tankless water heater must have exactly the right lines, water pressure and gas pressure to work safely and well. A local contractor can also make sure that repair parts and service will be available in your area. We read quite a few sad comments from owners who are stranded without any technical support or parts.

The most-recommended companies are Bosch and the Japanese company Takagi. Keltech, Noritz, Rheem/Ruud, Rinnai and Stiebel-Eltron also get recommendations in at least one review. Tagaki makes gas tankless water heaters, and all the current models meet the eligibility requirements for Energy Star ratings. Some far exceed the minimum. For example, the Flash

T-H1 (*Est. $2,800) has an outstanding EF rating of 0.92 for natural gas, 0.94 for LP gas/propane -- accomplished by using dual heat exchangers. The first-hour rate is 285 gallons (if the heater has to heat the incoming water no more than 77 degrees). Compare that with the 92 gallons an energy-efficient gas tank-style water heater can produce in an hour.

The Bosch AquaStar 1600H (*Est. $745) gets reasonably high ratings from owners at Lowes.com, and also gets positive comments from owners in a forum at the Berkeley Parents Network. The AquaStar 1600H has an EF rating of 0.80 -- not high enough to attain Energy Star status and a federal tax credit. When professionally installed, all the AquaStar water heaters carry a 12-year warranty.

Appliance researcher Jim Dulley likes the AquaStar water heaters. It's designed to serve only one faucet at a time, however, so it's a bit of a stretch to try to use them for more than a point-of-use water heater. The rate of output ranges from about 2 to 4.2 gallons per minute, depending on the temperature of the water coming in. This model is no longer available at Amazon.com, but last year about a dozen owners gave it mostly positive reviews there.

Electric point-of-use water heaters

Bosch also sells small electric water heaters designed for point-of-use placement, serving one or two faucets at most. Reviews say they're useful either to boost another water heater or to operate alone. Both the PowerStar and Ariston water heaters get mostly positive reviews, but the PowerStar models, when professionally installed, carry a longer 10-year warranty. (The Ariston models carry a six-year warranty.)

Both series are sized to fit under a sink, but the PowerStar models have to be wired into the circuit box, while the Ariston water heaters just plug into an outlet. There are other differences too. The PowerStar models are true tankless water heaters, while the Ariston water heaters add a tiny tank to ensure instant hot water. Owners like the way it's easy to adjust the temperature setting on the PowerStar water heaters. You can add a similar knob to the Ariston models, but it requires some do-it-yourself confidence.

The PowerStar AE-3.4 (*Est. $250) is the only water heater in this series that's small enough to run on a 15-amp circuit, but we didn't find any review of it. The other PowerStar water heaters require 240-volt wiring, but owners reviewing water heaters at HomeDepot.com give them very high ratings. The external knobs make it easy to adjust the temperature, and all the PowerStar models carry five-year warranties.

Owners like the 50-amp PowerStar AE12 (*Est. $300) for instant hot water at one sink or shower. It only weighs 6 pounds and is very easy to mount under a sink. The 120-amp PowerStar AE-125 (*Est. $600) has a high EF of 0.95 and an external knob makes it easy to adjust the temperature to save electricity. This model also gets high ratings from owners, but they warn that wiring it requires at least a 200-amp circuit box plus three available double-pole breaker slots. That's not a problem for new houses, but it prohibits installation in a lot of existing homes.

Owners reviewing water heaters at HomeDepot.com praise the larger Bosch PowerStar AE-125 Electric Tankless 240V (*Est. $600), but warn that it requires three 240-volt circuit breakers in a box with at least a 200-amp power supply. Quite a few houses don't have that many spaces free in the circuit box.

The 1,500-watt electric Bosch Ariston water heaters are easier to install since they just plug into an ordinary outlet. However, owner-written reviews warn that it's best not to have any other big appliances on the same circuit. They're still small enough to install under a sink, but include tiny storage tanks ranging in size from 2.5 to 7 gallons.

Though sold by Bosch, the Ariston water heaters are actually designed and manufactured by an Italian company, Merioni Termosanitari (MTS), the larger manufacturer of electric water heaters in the world. The 4-gallon Bosch Ariston GL4 (*Est. $170) is the most popular in owner-written reviews, sized in between the 2.5-gallon Bosch Ariston GL2.5 (*Est. $140) and the 7-gallon Ariston GL6+ (*Est. $180).