I am often asked by homeowners if I recommend tankless water heaters. Some manufacturers claim they can cut energy costs by up to 50%.
So is it time to switch.
Well if you live in Ontario, probably not. ( In my opinion )
There is no question that Tankless water heaters also known as On Demand water heaters are more efficient and have operated in Eurpope quite successfully for many years. This was the major drive in bringing them to North America.
Consumer tests on a variety of on demand heaters have indicated actual average savings of 22% over conventional hot water tank heaters. This translates to actual savings of $70 to $100 /year depending on your energy costs.
The major difference between Eurpope and Ontario is the average temperature of the incoming ground water. In Ontario the ground water can be as low as 35 degF in winter. This means that the temperature rise to bring the water to 120 degF (recommended temperature) is significantly higher than Europe. For this reason high powered burners are required (as high as 200,000 Btu/hr) to provide the flow rates requried for most family homes. Compare this to the average furnace running at 60,000 Btu/hr.
Common problems appear to be:
1. Inconsistant water temperatures particularly under high demand when you are running mulitiple things at the same time.
2. High Up front costs for the unit and for specialized installation.
3. High maintenance costs. Some units require annual flushing (at a cost of $ 130 to $150 )
Bottom line is that with an annual saving of $ 70 per year it could take over 20 years to recover initial purchase cost. Typical lifespan of an actual unit is expected to be 12 to 15 years. Add in the cost of maintenance and the savings more than dissapppear.
If you need a new hot water heater today then my recommendation is to replace you tank unit for now. If you can wait 12 – 24 months then high efficiency tank heaters are being developed and introduced which will be much more efficient.
For more information on How tankless water heaters work: