Choosing an On-Demand Water Heater

Why pay to keep water hot 24/7? Here's how to decide if an on-demand water heater can save you money.

| March 17, 2008

Most water heaters heat 30 to 70 gallons of water and keep it hot until it’s needed. When you open the tap, hot water flows through the pipes and cold water enters the tank to be heated. But when you’re not using hot water, it’s being maintained at 120 degrees Fahrenheit (or more) — all day and all night, increasing your energy bills but not contributing to your comfort. Wouldn’t it be great if you didn’t have to keep a tank of hot water available to use the next time you open the hot water tap? A tankless or on-demand water heater makes it possible.

On-demand water heaters warm water as it’s needed, and they’re different from a standard tank water heater. A water heater with a tank heats water to a set temperature, but as cold water enters the tank, the water temperature gradually drops, and eventually you run out of warm water. Tankless heaters raise the temperature of water based on flow rate, so if you’re using more water (shower and dishwasher at the same time), it won’t be as hot, but the heater keeps producing hot water as long as you need it.

To choose a model that will work for your home, you’ll need to know three things: the temperature of cold water entering your house, the flow rate of hot water you’ll most commonly need, and the temperature of the hot water you want to use.

Suppose the temperature of water entering your house is 50 degrees. If you want to have hot water to take a shower and run the dishwasher at the same time, you’ll want about 5 gallons of hot water per minute. (To estimate hot water use, click here and scroll down to “Typical Flow Rates in Gallons per Minute.”) To get 95 degree water, you’ll need an on-demand heater that can raise the water temperature 45 degrees (95 – 50 = 45) at a flow rate of 5 gallons per minute.

Producing that volume of hot water would take a fairly large on-demand unit. You may need to re-evaluate how and when you use hot water. Or you might consider installing two units, depending on your floor plan. You’ll waste less water waiting for hot water to get to the tap if the heaters are close to where you use the water. Some models are small enough to fit in the cabinet under a bathroom sink.

When determining the temperature of hot water you’ll want, remember that if your current water heater is set to 120 degrees, you probably rarely run straight hot water in a shower or when washing your hands. The tank water has to be hotter than you need because as you use hot water, cold water is added to the tank to be heated. (That’s why a hot shower usually doesn’t turn instantly cold when you run out of hot water, but the water gradually gets cooler.)

11/6/2015 9:40:20 PM

It would be nice to have an article that contained enough information to make an informed decision. The link you included to determine how much capacity you need does not work. The key information that you do not include is that a tankless heater burns gas at a rate of 3 to 4 times what traditional gas water heater does. The example you gave quoted a raise of 45 degrees which is 25 degrees short of what most people need to take a shower or wash dishes. Where those degrees come from is a lower flow rate than you need or a much larger heater. This is the inherent flaw with the design and why many people are dissatisfied with their installations. We need more real world facts not just the feel-good greenspeak that is in this article jb

11/6/2015 3:58:52 PM

CO2, really? I stopped reading as soon as I saw that. If you believe that crap about CO2 crap, I can't trust the rest of the article. Moving on...

11/6/2015 9:26:05 AM

I installed a Paloma on demand water heater in a house I was working on in the late '70's. To get the water hot enough to take a shower, the pressure was quite low. I imagine that the systems have eliminated that problem since then?

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