Tankless vs Tank Water Heater

Investing in water heaters can be a costly investment for homeowners. When the time comes for you to equip your new home with a water heater, it’s essential to consider the cost as you’re faced with a tankless vs tank water heater decision.

Other things to consider are the effectiveness and longevity of your new water heater. We’ve put together this contrast of tankless vs tank water heaters to assist homeowners and contractors in choosing the type of water heater that’s a good choice for you.

We’ll examine the advantages and disadvantages of the tank or tankless water heater so you can make an informed choice. For even more information about this subject, check this page for more insights after this article.

What Is a Tankless Water Heater?

Also known as an on-demand water heater, the tankless water heater uses high-powered burners to rapidly heat water as it goes through a heat exchanger and delivers it directly to your shower without keeping it in a tank.

Tankless water heaters are often powered with electricity or gas. According to tests conducted by Consumer Reports, these water heaters are 22 percent more energy efficient on average than gas-fired storage-tank model sorts.

What is “Traditional” Tank Storage Water Heaters?

These are commonly found in most homes, and their components are an insulated tank often holding 30-50 gallons of water used to heat and store the water. A pipe comes from the top to deliver hot water to its destination like the kitchen, bathroom, or other sinks.

Typically, storage-tank water heaters use either natural gas or electricity for their fuel. Natural gas storage tank water heaters use about 50 percent less energy, costing less to operate than the electric variety. Though, they cost a bit more than electric models.

They also have a temperature and pressure-release valve that opens when either temperature or pressure surpasses preset levels.

Tankless Water Heater Energy Efficiency

Most homeowners with tankless water heaters that use less than 40 gallons or less of hot water each day benefit from 24 to 34 percent more energy efficient than storage tank water heaters.

If you’re a person who uses lots of hot water daily (around 86 gallons), you might enjoy an additional 8 to 14 percent energy efficiency.

Buying a tankless water heater can cost you a bit more than a traditional storage-tank water heater.

Still, tankless varieties last longer than conventional water heater models, which translates to a 20+-year useful life compared to storage tank types that last only 10 to 15 years before self-destructing. It can flood your basement or home, depending on how they were placed.

In case you want to “hit a home run,” choose a tankless water heater on each hot water outlet because you may get energy savings of 27 to 50 percent just by putting on-demand water heaters on all hot water outlets in your home.

Advantages of Tankless water heaters

Saves you money over time

In terms of cost, tank or tankless water heater? Tankless wins.

According to a statement from Energy.gov, “For homes that use 40 gallons or less of hot water every day, tankless water heaters can be up to 34% more energy-efficient than conventional storage-tank water heaters.”

Tankless water heaters (if gas-fired) can save homeowners over $100 annually the longer they remain in service. From the US Department of Energy report, electric tankless water heaters still save homeowners around $44 per year.

Lives longer compared to storage tank water heaters

Tankless water heaters typically last up to 30 years, double the forecasted useful life of a storage-tank water heater. However, “hard water” areas may reduce the useful life of both types of water heaters.

Does not consume the space of a storage-tank water heater

Tankless water heaters are considerably small and placed in “tight quarters.” They can even be installed outside the walls if your home is terminally space-challenged.

You’ll have hot water anytime you need it

Waiting for your water to become hot is not a thing for tankless water tanker heaters, as they give two to three gallons of hot water per minute. Most storage-tank water heaters take longer to heat water depending on the larger volume of water they must heat than most tankless types.

Disadvantages of Tankless Water Heaters

Higher purchase cost

Tankless water heater installation is costly if you’re replacing a storage-tank water heater with a tankless-type water heater.

Installation costs

Installing a tankless water heater in place of a storage tank is a little bit costly and time-consuming. You will find that your plumber will take more time, increasing the installed cost of replacing a storage-tank water heater.

This is because of the complexity of evacuating existing piping.

They can be “output challenged”

Taking showers and doing laundry may cause your tankless water heater to fail to meet the hot water demand. If you have many showers in use in your home, you often will have one of the shower-takers endure a “chilly” experience.

Advantages of Tank Water Heater


Storage tank water heaters are uncomplicated in operation compared to tankless varieties, resulting in less costly maintenance plus repairs.


Tank water heaters’ simplicity results in low-cost repairs when the water heaters are not functioning correctly. Tankless water heaters are again more complex and expensive in repair and replacement.

Disadvantages of Storage (Tank) Water Heaters

Higher utility bills

Because storage tank water heaters heat, then reheat the water to the preset temperature, which increases your utility bills, irrespective of what your hot water needs.

If these water heaters function in a relaxed environment (location), they’ll work harder, mainly in the winter months, raising your gas or electric bills higher during the cold winter.

Occupy more space because of their size

Tankless vs tank water heater in space efficiency, tankless is better.

If your home is space-restricted, you’ll get challenges finding enough area to locate storage tank water heaters. And they cannot be placed outside your home like tankless water heaters.

With tank water heaters, you don’t want to be the last to take a shower.

You may require a larger one with tank water heaters if many showers are often taken. Because this option may relieve the hot water shortage, your energy bills will increase with your hot water availability.

These storage tank water heaters can only accommodate three showers in succession, so unless you love cold or not hot showers, you won’t want to be the fourth.

Shorter useful life

Storage tank types possess a shorter helpful life (about half the life of tankless water heaters), mainly after 10 to 15 years, you may need to buy and install again almost twice as often as tankless water heaters, which reduces your purchase savings.

In Summary

Is a tankless water heater better? When it comes to the tankless vs tank water heater battle, the tankless wins.

If you can manage the higher starting cost of a tankless water heater, you’ll save a lot of money by choosing tankless in the long run. But, if you are on a fixed income, a storage-tank water heater might be a suitable option for you.