Tankless or Demand-Type Water Heaters | Department of Energy

Tankless water heaters, often referred to as on-demand water heaters, have revolutionized the way households access hot water. Unlike traditional systems that store and continuously heat water in a tank, tankless units heat water directly as it flows through the device, providing hot water only when needed. This fundamental difference in operation offers a range of advantages and disadvantages that homeowners should consider before making the switch. In this comprehensive guide, we’ll delve deep into the pros and cons of tankless water heaters, discuss essential maintenance practices, and help you determine if this technology aligns with your household needs.

Advantages of Tankless Water Heaters

  1. Energy Efficiency and Cost Savings

    Tankless water heaters are celebrated for their energy efficiency. By heating water only on demand, they eliminate the standby energy losses associated with traditional storage water heaters. According to the U.S. Department of Energy, homes that use 41 gallons or less of hot water daily can achieve energy savings of 24% to 34% by switching to a tankless system. For households with higher water usage, the savings are approximately 8% to 14%. Over time, these reductions in energy consumption can lead to noticeable decreases in utility bills.

  2. Continuous Hot Water Supply

    One of the standout features of tankless water heaters is their ability to provide a continuous supply of hot water. Traditional tanks can deplete their hot water reserves, leading to cold showers until the tank reheats. In contrast, tankless systems heat water as it flows through the unit, ensuring that hot water is always available, regardless of demand.

  3. Space-Saving Design

    The compact nature of tankless water heaters is a significant advantage, especially for homes with limited space. Traditional water heaters with large storage tanks can occupy considerable floor space. In contrast, tankless units are typically wall-mounted and significantly smaller, freeing up valuable space in utility rooms, basements, or closets.

  4. Extended Lifespan

    Durability is another benefit of tankless water heaters. While traditional storage water heaters typically last 8 to 12 years, tankless models can function effectively for up to 20 years with proper maintenance. This extended lifespan can offset the higher initial investment over time.

  5. Potential for Tax Incentives and Rebates

    Due to their energy-efficient nature, many governments and utility companies offer tax incentives or rebates for homeowners who install tankless water heaters. For instance, certain Energy Star-certified models may qualify for federal tax credits, reducing the overall cost of installation.

Disadvantages of Tankless Water Heaters

  1. Higher Initial Costs

    The upfront expense of purchasing and installing a tankless water heater is notably higher than that of traditional models. The unit itself can be more expensive, and installation may require modifications to existing plumbing or electrical systems, further increasing costs. However, it’s essential to weigh this initial investment against potential long-term energy savings.

  2. Limited Flow Rate

    While tankless water heaters provide continuous hot water, their capacity is limited by flow rate. Simultaneous use of multiple fixtures—such as running a shower and dishwasher concurrently—can strain the system, leading to reduced water temperature at one or more outlets. Proper sizing of the unit based on household demand is crucial to mitigate this issue.

  3. Temperature Fluctuations

    Some users report experiencing a “cold water sandwich,” where brief bursts of cold water occur between periods of hot water delivery. This phenomenon can be attributed to residual cold water in the pipes and may require additional system adjustments or the installation of a small buffer tank to resolve.

  4. Dependency on Electricity

    Even gas-powered tankless water heaters rely on electricity for ignition and operation. During power outages, these units will not function, leaving households without hot water. In contrast, some traditional gas water heaters can operate without electricity, providing hot water during outages.

  5. Maintenance Requirements

    Regular maintenance is essential to keep tankless water heaters operating efficiently. Tasks such as descaling to remove mineral buildup are necessary, especially in areas with hard water. Neglecting maintenance can lead to decreased efficiency and potential system failures.

Maintenance and Care for Tankless Water Heaters

Proper maintenance is vital to ensure the longevity and optimal performance of a tankless water heater. Neglecting routine upkeep can lead to inefficiencies, reduced performance, and even premature system failure. However, with a proactive maintenance plan, your unit can serve you efficiently for 15 to 20 years or more. Below are essential maintenance practices every homeowner should follow:

Regular Descaling

Mineral buildup, particularly from calcium and magnesium in hard water, can accumulate within the heat exchanger, reducing efficiency and potentially causing damage. It’s recommended to flush the system every 6 to 12 months to remove these deposits. This process involves circulating a descaling solution—often white vinegar or a commercially approved descaler—through the unit to dissolve and eliminate mineral buildup.

Hard water areas may require more frequent descaling. Installing a water softener can help reduce mineral content before it reaches the heater, prolonging the intervals between descaling and extending the life of the unit.

Steps for Descaling:

  1. Turn off the power and gas supply to the unit.

  2. Close water valves and attach service hoses to the inlet and outlet.

  3. Connect a submersible pump to a bucket filled with descaling solution.

  4. Circulate the solution for 30 to 45 minutes.

  5. Flush the unit with clean water to remove any remaining chemicals.

  6. Reopen the water valves and restore power.

This process is straightforward for experienced DIYers, but hiring a professional ensures thorough and safe execution.

Filter Cleaning

Many tankless water heaters are equipped with inlet filters to trap debris and sediment before water enters the system. Over time, these filters can become clogged with rust, sand, or mineral particles, leading to restricted water flow, overheating, and increased wear on internal components.

How to Clean the Filter:

  • Locate the cold water inlet and unscrew the filter.

  • Rinse it under running water to remove trapped debris.

  • Gently scrub with a soft brush if necessary.

  • Reinsert and secure the filter before resuming operation.

Regular filter cleaning should be done every few months, or more often if your water supply is known to carry sediment.

Ventilation Inspection

Proper ventilation is crucial for the safe operation of gas-powered tankless water heaters. These systems require unobstructed airflow to vent harmful gases such as carbon monoxide. Any blockage or damage in the venting system can pose serious health and safety hazards.

Routine Checks Include:

  • Inspecting the vent pipe for cracks, corrosion, or disconnections.

  • Ensuring there are no obstructions (e.g., bird nests, leaves) at the exhaust outlet.

  • Verifying that condensation drains are not blocked.

  • Checking for proper slope and secure connections in horizontal venting.

It’s advisable to have a licensed technician inspect the venting system annually, especially in colder climates where vents can become iced over in winter.

Annual Professional Inspection

While many maintenance tasks can be handled by homeowners, scheduling an annual professional inspection is highly recommended. A certified plumber or technician can perform detailed diagnostics that may not be visible to the untrained eye, such as:

  • Heat exchanger condition assessment

  • Gas line and pressure checks

  • Electrical connection testing

  • Software updates for digital control units

  • Leak detection in internal components

  • Flow sensor testing

Professional servicing ensures your unit is running at peak efficiency and helps prevent expensive breakdowns. It’s a small investment compared to the cost of replacing a neglected system.

Monitoring Error Codes and Alerts

Modern tankless water heaters come equipped with digital display panels or smart home integrations that show real-time system diagnostics. If the unit detects an error—such as a flame failure, ignition delay, or flow restriction—it will display a code indicating the problem.

Refer to the manufacturer’s manual to interpret these codes. Ignoring error messages can result in worsening issues or complete system shutdown. If unsure, consult with a professional plumber to diagnose and fix the problem.

Preventing Freezing in Cold Climates

Tankless water heaters located in garages, crawl spaces, or exterior walls are at risk of freezing in cold weather. Although many models include built-in freeze protection, additional steps are recommended:

  • Insulate exposed pipes with foam sleeves or heat tape.

  • Use a pipe heater or heat lamp in the installation area.

  • Drain the heater completely if the unit will be unused for an extended period during winter.

  • Leave a faucet slightly open to allow a trickle of water, which helps prevent freezing.

Proper winterization protects internal components and prevents costly repairs from burst pipes or heat exchanger damage.

Water Pressure Monitoring

Consistently high water pressure can strain the tankless unit and reduce its lifespan. The recommended pressure range is typically between 30 to 80 PSI. If your home’s water pressure exceeds this, consider installing a pressure-reducing valve (PRV).

Low pressure, on the other hand, could indicate a clog in the inlet filter, mineral buildup, or plumbing issues that require professional attention.

Flushing the System After Long Periods of Inactivity

If your tankless system hasn’t been used for a while—such as in vacation homes or seasonal cabins—it’s wise to flush it before resuming use. Stagnant water inside the unit can harbor bacteria, sediment, and foul odors.

A thorough flush with clean water, followed by a vinegar rinse, helps clear the unit and restore safe, fresh water flow.

Cleaning the Exterior

In addition to internal maintenance, don’t forget the exterior of your tankless heater. Dust and grime can accumulate around vents, panels, and display screens. Use a soft cloth and gentle cleaning solution to wipe down the surfaces. Make sure not to block ventilation or air intake openings.

Keeping the exterior clean reduces the risk of overheating and allows better airflow, especially in confined or enclosed spaces.

Upgrading Software (For Smart Models)

Some newer tankless models offer Wi-Fi connectivity and smart home compatibility. These features often include software updates that improve performance, diagnostics, and energy usage reporting. Periodically check the manufacturer’s app or website for available firmware upgrades.

Staying up-to-date ensures you’re getting the most out of your investment and can even alert you early to upcoming service needs.

Keep Records of Maintenance

Maintain a logbook or digital file with service dates, descaling frequency, error code reports, and technician visits. This record will be valuable for:

  • Tracking the unit’s performance over time

  • Verifying warranty compliance

  • Informing future repair technicians of the unit’s service history

It also adds value if you plan to sell your home and want to demonstrate the system’s reliability and maintenance.

Making the Smart Switch with Breakwater Plumbing

Tankless water heaters represent a smart, energy-efficient, and modern solution for homeowners looking to enjoy an endless supply of hot water while saving space and cutting energy costs. From their rapid heating capabilities to their compact size and eco-friendly operation, these systems offer a wide range of benefits that traditional tank heaters simply can’t match. But like any home investment, the true value of a tankless water heater depends on proper installation, routine maintenance, and ongoing care.

We’ve explored both the advantages and disadvantages of tankless systems in depth—highlighting how they can lead to long-term savings, lower environmental impact, and greater convenience, while also noting challenges such as initial cost and installation complexity. However, with expert guidance and proper upkeep, these hurdles are easy to overcome, making tankless heaters one of the best choices for modern homes.

In the section on maintenance and care, we covered how descaling, filter cleaning, professional inspections, and even simple tasks like checking vents and pressure can significantly extend the life of your system and maintain optimal performance. These are not just suggestions—they’re essential habits that preserve your unit’s health and maximize your investment.

And that’s where Breakwater Plumbing truly stands out.

With years of experience, technical know-how, and a customer-first approach, Breakwater Plumbing is your trusted partner for all things tankless. Whether you’re exploring tankless water heaters for the first time or need a reliable team for maintenance and support, Breakwater delivers top-tier service every step of the way.

Their licensed technicians not only ensure precision installation and code-compliant work, but also take the time to educate homeowners on how to get the most from their systems. From selecting the right model for your household needs to ongoing support and emergency service, Breakwater Plumbing provides peace of mind alongside hot water—day in and day out.

If you’re ready to upgrade your home’s water heating system or want expert help maintaining your current tankless unit, don’t settle for less. Choose a company that combines technical excellence with a genuine commitment to your comfort and satisfaction.

Choose Breakwater Plumbing—where quality meets reliability, and innovation meets service.

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