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Tankless 101: Why should I care?

Section 1: What is a tankless water heater?

Section 2: Why should I care?

Heating and cooling have long been the most costly endeavors as it pertains to the amount of energy we use and how much money we spend to do it. The reality is that the cost of heating and cooling our homes should be at the forefront of monthly budgeting as it is one of the largest ongoing expenses we encounter from utility companies. When it comes to taking a hot shower most of us don't think about the method by which we do it, nor what is involved in the process of heating the water we use. Let's face it, hot water is a luxury that we can not live without and it can be a burden or downright life threatening when we don't have it available to us. 

That said, the average cost to heat water in the USA with a traditional tank water heater is approximately $610 and 5000kWH per year using a traditional tank based electric water heater. This is according to averages we've derived from a tool at and an article called "The Price of Electricity in Your State" by which gleaned information from the US Energy Information Administration

With a tankless water heater, given the same amount of water usage (approximately 60 gallons per day) the cost to heat water with a 16KW unit would be right around $356 per year. That is if only one person takes a shower in one bathroom at a time. If two bathrooms are used at a time the savings may be even greater. The averages start to get a little muddy here and many manufacturer claim a 60% savings.  We, on the other hand, like to be conservative about our numbers and prefer the 40% range. You can expect to be somewhere right in between 40% to 60% savings on your electric cost to heat water!

In reality, a traditional tank water heater actually uses "less" electricity in KW than a tankless.  The savings comes by way of total usage. You see, as we mentioned in the previous section, the "Flow Switch" in a tankless water heater turns on only when there is water flow and the heater subsequently heats only the water you need, ON DEMAND and therefore only consumes electricity when needed. On the other hand, the clock never stops for a traditional storage based water heater. It heats and maintains water 24 hours a day, 365 days a year. It never stops, it never sleeps and it consumes energy incessantly.

According to some totally unscientific research we've done, if every home in america that uses an electric "storage" water heater about (49%) or (25 million homes) were to switch to electric "tankless" water heaters, the United States would save about 50 BILLION POUNDS OF COAL or about 95 MILLION BARRELS OF PETROLEUM every singe year! That's enough to power all of New York City for 331 DAYS EVERY YEAR! Here's a PDF we used from to arrive at these numbers. 

Section 3: When should I consider using one?

Section 4: How do I know which one is best for my home?