Tankless water heaters are all the rage these days.  Their super high efficiency and advertised unlimited water supply seem the perfect investment for your home, especially when you are confronted with replacing an existing unit.  There are a few aspects of the tankless system that are not that great however, and the better choice might be a high performance traditional water heater.

Tankless Water Heater

The tankless water heater requires a different exhaust venting system.  This isn’t a big issue when installing in a new home, but if you have an existing tank water heater, the labor and parts involved in building a sealed, stainless steel or manufacturer approved vent can get costly.  The tankless systems require their own, dedicated vent to the exterior of your home.  Most tank systems share a vent with the furnace.  The material used for a traditional water heater is not sufficient for the new tankless systems either, so a full replacement, or direct vent through a wall is needed.

Tankless water heaters also require more natural gas or propane, usually quite a bit.  A traditional water heater might have a 30k-50k BTU/hour burner, where a tankless can be upwards of 300k BTU/hour.  This means a much larger gas line, possibly a full dedicated 1″ line from the meter.  The meter might need an upgrade as well to support the added load, depending on existing equipment and load.

The instant keyword causes some confusion as well.  Tankless systems are not instant, as they usually require 1/2 gallon of water through the system before the heater will begin heating the water.  Most faucets move water between 1-1.5 gallons per minute, so expect to wait a while before the water gets hot.  If you are washing your hands in a remote bathroom, a good distance away from the heater, expect to wait even longer.

There are also greater sizing concerns.  A tankless water heater has to be sized for the home based on total gallons per minute usage.  The more showers, faucets, and hot water devices in the home, the larger the tankless system needs to be.  This is different that sizing a traditional tank system; with a traditional tank system, a larger tank is needed, but the gas supply and venting system remains the same.  The larger tankless systems require more gas and possibly different vending and more space to mount.

High Performance Water Heater

The new high performance water heaters, like the ones produced by Bradford White, offer a different approach.  It is a traditional tank based water heater with a super-heated tank of water.  It then mixes the super-heated water with cold water as needed.  These water heaters can use existing venting and gas supply, making them a quick and easy replacement.  They cost about the same as a tankless system, but labor costs are greatly reduced.

Water heaters are reviewed using a First-Hour-Rating which basically measures how much hot water the heater can put out in an hour.  A standard water heater can usually put out twice its volume in one hour.  So a 30 gallon water heater should put out about 50-60 gallons of hot water in the first hour.  A high performance or high efficiency water heater can put out up to 6 times the tank size.  So a 25 gallon tank can put out over 150 gallons of hot water in the first hour.

These high performance water heaters do use more gas to run, needing about twice the BTU.  The nice thing is they require a 1/2″ gas connection, which is a standard size and probably already in your home.

Conclusion

In a new home, a tankless system might be the way to go.  As long as the house is designed for a tankless water heater, with the necessary gas supply and proper venting, this kind of water heater will be an investment that will pay off in the long run.  For existing homes, with a traditional water heater, the clear answer is a high performance or high efficient tank based water heater.  These systems are usually plug and play and are a great solution for high demand hot water needs.