The Pros and Cons of Tankless Water Heaters

Tankless Water Heaters have been getting buzz for a while now. If you’re in the market for a new water heater you may be curious about what “tankless” means, how it works and if it is right for you.

Unlike traditional water heaters that store heated water in a large tank so it is available when needed, tankless – or on-demand – water heaters only heat the water when it is needed. This results in energy savings because you aren’t paying to keep all that water (40 or more gallons) hot all the time. But, there is more to know about this type of system. Here is a list of the pros and cons.


  • Hot water on demand
    Tankless water heaters can work well in smaller homes where multiple faucets aren’t being used at the same time.
  • Longer life expectancy
    Because water corrodes the metal tank in a traditional storage heater, it will start to break down and need replacement after about 10 to 15 years. The tankless system avoids this problem because the water is never stored, and can last as long as 20 years.
  • Tankless water heaters are 99% efficient and can save money over time
    Tankless water heaters use considerably less energy than storage water heaters — 30 to 50% on average. That translates into savings on utility bills of up to $100 or more per year, depending on how much water you use.
  • Tankless water heaters save space
    A compact design gives tankless water heaters a much smaller footprint than storage heaters. They can often be mounted on a wall and/or installed in a closet.
  • Tankless water heaters offer longer warranties
    The warranty for a tankless heater can be about the same as the actual useful life of a storage water heater — about 15 years. Traditional water heaters typically have a 6-year warranty.
  • You don’t have to worry about leaking issues
    Because the water isn’t stored in a tank that can potentially fail, there is virtually no risk of leaking.


  •  The high up-front cost
    The primary disadvantage of tankless water heaters is the significantly higher up front cost compared to the cost of tank water heaters. It takes approximately 25 years to payoff the extra cost through energy savings.
  • Uses more fuel
    While the water isn’t being continuously heated, more fuel is used to heat the water when it is needed.
  • Special venting requirements
    Tankless units have high-powered burners that have special venting requirements including a dedicated, sealed vent system, which requires professional installation. Natural gas burners often need a larger diameter gas pipe. This can add significantly to the initial installation cost.
  • Comfort may be sacrificed
    Water pressure loss may occur during the winter. This depends on the how the water heater is being used.

Every situation and home is different.  If you are thinking of having a tankless water heater installed, make sure to have an expert provide an in-home assessment. Contact ABE Heating and Cooling today to learn more.