Tankless vs Storage Water Heaters


When choosing how to heat the water you use in your home, the choice tends to fall between the tankless water heater, and the standard vent water heater which uses a storage tank. They both have their benefits, and which one is best for you depend on your priorities. Let’s break down their differences in a few important categories: how they work, their performance, and their efficiency in energy use.

How They Work

How Storage Tank Water Heaters Work

The traditional water heater is the storage tank water heater, usually a standard vent water heater. They commonly come in 50-gallon tank size, but depending on your home’s water usage, you can find them in sizes from 30- to 60-gallon tanks. They tend to be 5 feet tall and around 2 feet wide, but can be wider. This is no problem if you have basement, but if you don’t it can present space issues.

With storage tank water heaters, your water heater is working constantly to maintain a tank of hot water. This means you’re paying for the natural gas, oil, electricity, or propane used to heat the water whether you’re using hot water or not.

How Tankless Water Heaters Work

Instead of heating a full tank as a reserve for when you need your hot water, tankless water heaters heat the water as you use it. As the water being sent to your faucet or shower head passes through the tankless water heater, a heat exchanger within it quickly heats the water before it is sent to you. The result is hot water whenever you need it, no running out. They can run on electricity, propane, or natural gas.

Since there is no large tank attached, it takes up far less space. You mount the tankless water heater on the wall, and they are generally 2 feet tall and a just over 1 foot wide.


The experts at Consumer Reports ran some tests on storage tank water heaters vs. tankless water heaters, and this is what they found.

How Do Storage Tank Water Heaters Perform?

As the traditional water heater, the storage tank heaters were used as a control to be compared with the tankless water heaters. Both a gas-powered and electricity-powered storage tank heater were tested. They were both found to easily deliver a steady supply of hot water, reaching their target temperature of 120 degrees Fahrenheit.

How Do Tankless Water Heaters Perform?

While tankless water heaters performed well, there was some variability depending on how they are powered. The gas-powered tankless water heaters were able to consistently supply water at a temperature of 120 degrees Fahrenheit without issue. For electric tankless water heaters, there is one important thing to note. When the water going into the electric model started at 74 degrees, there was no problem supplying water at 120 degrees. But when the water going into the electric model started at 58 degrees, some of the electric models tested weren’t able to get the water up to 120 degrees. This means that if you’re considering an electric tankless water heater, they are best for regions where the groundwater is warmer like in the South.

Energy Use and Efficiency

Consumer Reports also tested their energy use and efficiency, and this is what they found. It’s important to remember when looking at annual estimated costs for each model that the average cost of natural gas is far less than the average cost of electricity. In fact, the electric models tended to be more efficient, but cost more due to the cost of their source of energy.

Energy Use and Efficiency of Storage Tank Water Heaters

Both the electric and gas models of the storage tank water heaters received an energy efficiency score of Good. But there was a difference in energy consumption. Energy consumption for the gas model was Very Good, while for the electric it was Fair. The estimated yearly cost of using a gas model was $245, while the estimated yearly cost of the electric model was $580.

Energy Use and Efficiency of Tankless Water Heaters

Both the gas and electric models of the tankless water heater were more efficient than their counterparts in the standard tank water heater. They each received a score of Very Good for their efficiency. Using the same estimating model for yearly cost as above, the gas tankless water heater would cost $195 per year and the electric tankless water heater would cost $535 per year.

Water Heater Installation & Repair | Aaron Swift Plumbing

There are a lot of things to consider when choosing the right water heater for your home, from the source of power, to tankless or storage tank, to which will perform best for you and the costs associated. If you need help choosing, let us offer our expertise. We can look at your situation and your priorities and suggest which one meets your needs best. Then, we can install it for you and perform maintenance on it over time so you get the full useful life out of your water heater.

To learn more, give us a call at (586) 315-4595 or send in an online contact form today!

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