Water heating technology is constantly evolving and advancing.
Whether you’re looking for your first unit for a new house or you’re considering a replacement for an existing unit, you’ve got a potentially confusing welter of types to navigate.
Luckily, we’re here to simplify all that for with a breakdown of each type of water heater along with its benefits and drawbacks.
There’s no such thing as the right water heater. All that counts is getting the right system for you.
We’ll dive down into all these so you can see which makes the best fit:
- Tankless Water Heaters: Gas and Electric
- Heat Pump Water Heaters
- Solar Water Heaters
- Condensing Water Heaters
The only question that remains is how are you going to best slash energy costs while still enjoying the heated water supply you need?
Before we address that type-by-type, we’ll look at some more general pointers to streamline your buying decision.
1. Tankless Water Heaters: Gas and Electric
How They Work
With no need at all for a storage tank or a heat pump, a tankless system is remarkably energy-efficient.
Cold water runs directly from pipe to appliance and it’s heated by way of gas, electricity or propane.
The average tankless heater can supply around 3.5 gallons of hot water per minute.
As a rule of thumb, a tankless unit makes sense if you don’t need hot water at more than 2 points simultaneously. Most of the decent tankless models allow for more than a single application running at once but they don’t perform strongly if overworked. This shouldn’t present a problem for most households.
“Most tankless water heaters have a life expectancy of over 20 years.” – Department of Energy. (1)
This gives you substantially more longevity than the 10 to 15 years of life you can expect from a traditional storage water heater.
- Hot water will never run out since it’s heated on demand
- The fact water is not stored in a tank means it will be fresher than if allowed to sit in a tank that might contain rust or scale
- Energy-saving so cuts down on both household bills and your environmental footprint
- Space-saving form factor so hang it on the wall and free up precious floor space
- Very little beats the convenience of a tankless system and you can achieve realistic savings of 30 to 50% on your energy costs
- Although you’ll pay more upfront, you’ll also get dramatically improved lifespan compared to a traditional storage tank model
- Parts are designed to be repairable and replaceable
- Very short lag between burners firing up and heated water coming out
- Difficult to achieve maximum strength from multiple water streams
- Installation can be awkward
- Many tankless models require annual flushing to keep scale down and ensure energy efficiency is maintained
What To Look For When You’re Buying a Tankless Water Heater
- Non-Condensing: The primary heat exchanger used kicks out hot exhaust. This means you’ll need to factor in the expense of installing a vent
- Condensing: With a condensing unit, there’s a second heat exchanger. This uses exhaust from the first heat exchanger to heat the water further leading to increased efficiency
- Hybrid: This type was created in the US and included the addition of a very small holding tank. By overcoming the baked-in inefficiency of short draws, hybrid models can hit remarkable efficiency ratings of 0.96 (with 1.0 representing perfection)
A bit more about that efficiency angle now…
New federal efficiency standards were rolled out on April 16, 2015 regarding tank style heaters:
“The new standard will avoid about 180 million metric tons of carbon dioxide emissions, equivalent to the greenhouse gas emissions of about 35.3 million automobiles.” – Department of Energy
These regulations impacted the size and cost of traditional heaters leading to tankless models becoming increasingly attractive as the price differential starts to close up.
Energy-efficiency is one of the leading reasons to buy a tankless model so it makes sense to double down on this when you’re hunting for the best fit for your home.
Efficiency with water heaters is measured in terms of the Energy Factor (EF).
According to ENERGY STAR (2):
- EF measures a water heater’s overall efficiency
- The EF rating is determined by how much useful energy comes from the water heater
- This number gets divided by the energy (electricity or gas) that goes into the unit for the purposes of heating the water
- EF ratings are based on the quantity of hot water produced by a single unit of the fuel consumed
- Higher EF ratings translate to more efficient water heaters
Use the EF rating as an initial guide but be aware of other salient factors when it comes to efficiency…
While electric tankless systems tend to win higher EF ratings, since gas is presently less expensive, a seemingly less efficient gas model might serve up lower annual operating costs.
Think about temperature rise, too. While a gas unit with a flow rate of 5 GPM makes a 70 degrees F temperature rise possible, for an electric equivalent to do the same, flow rate would reduce to just 2 GPM.
We’ll look at that in more detail now as we drill down on sizing your heater the easy way…
Sizing up the most appropriate tankless water heater for your home is straightforward if you know what you’re doing. We’ll simplify the science for you to make that easier.
Tankless water heaters are sized by establishing the temperature rise required to meet a given flow rate.
Most tankless systems fall in the range of 2 to 5 gallons of water per minute delivered on demand. As mentioned, gas models tend to deliver superior flow rates.
Unlike traditional water heaters where the capacity of the tank is gallons is the prevailing metric, it’s flow rate that counts with tankless systems.
Since you won’t have a backup supply of stored water to fall back on, calculating the flow rate you need accurately is key if you don’t want to run out of water.
Steps To Sizing Tankless Heaters
- Calculate peak demand flow rate of your household
- Calculate temperature rise in your home
- Select the heater that best fits this calculation
Calculating Peak Demand Flow Rate
Determine how many hot water devices you will use at any given time and add the GPM of each device to calculate peak demand flow rate.
Here are some examples:
- Bathroom Faucet: 2.2 GPM (1992 standard) or 3 to 5 GPM (older faucets)
- Kitchen Faucet: 2.2 GPM (1992 standard) or 3 to 7 GPM (older kitchen faucets)
- Shower: 2.2 GPM (1992 standard) or 4 to 8 GPM (older showerheads)
Don’t forget to take appliances like washing machines and dishwashers into account.
Adding up all these devices and appliances you’re liable to use simultaneously will give you your peak demand flow rate in gallons per minute.
Calculating Temperature Rise
Establish the desired temperature of your hot water (output temperature) and subtract the ground water temperature. This latter is the temperature of the water entering your home.
Once you have this figure, bear in mind the temperature rise is likely to change throughout the year since, in most climates, incoming water tends to be colder during the winter months.
With these 2 figures up your sleeve, you can shoot for the most suitably sized water heater.
The type of fuel you choose will affect both the size and the energy-efficiency of the unit.
It’s a costly move to switch fuel sources so get this decision right first time.
Often, this choice will be dictated by the type of fuel available in your area.
These are the main options at your disposal:
- Gas (Natural or Propane)
Gas tankless heaters are normally more expensive to buy.
These heaters also call for annual servicing but in return you get a number of benefits including:
- Quick response time
- Elevated heat output
- Superior performance
- Improved energy savings/operating cost ratio
You’ll need to think about the fuel supply line. Burners on gas tankless heaters can reach outputs of 200,000 BTU compared to the standard 75,000 with traditional water heaters.
It might be necessary to increase the capacity of your gas fuel line to accommodate a tankless heater.
There are 3 types of ignition system with gas models:
- Direct Ignitions
- Hydro-Power Ignition
- Standing Pilot Light
You’ll also need to think careful about venting if you’re choosing an indoor gas tankless system. If so, you’ll need Category III venting made from stainless steel.
Condensing tankless heaters eliminate the need for venting and we’ll look at those below in more detail.
Less expensive to buy and install, electric on-demand units draw down a fair bit of power in operation.
Here are some of the primary benefits of electric tankless water heaters:
- They come in at roughly 1/3 the size of a gas unit
- Electric models are more energy-efficient
- Installation is simple and inexpensive
- You’ll get a flow rate of up to 8 GPM
- Service life tends to be longer
- Troubleshooting, diagnostics and repairs are easier
- An eco-friendly heating solution
- No venting required so you can pop them almost anywhere
- Very little maintenance required
2. Heat Pump Water Heaters
A tankless water heater, as the name makes clear, doesn’t store hot water in a tank.
A heat pump water heater is a hybrid unit with 2 discrete elements:
- An indoor air handler
- An outdoor conditioner
These elements work together to reverse surrounding temperatures on-demand.
This same principle is also used to heat and cool your home which is what most people are more familiar with than when the technology is used for this type of water heater.
With a heat pump in place, you can achieve efficiency of more than double a standard electric water heater.
How, exactly, do they work then?
How They Work
The underlying principle of a heat pump water heater (HPWH) is that heat energies are constantly present in the air even if the weather is very cold.
Heat pumps serve to make use of those energies much like the reverse action of a refrigerator.
With a HPWH, heat is moved from the surrounding space into a hot water tank where the water gets heated.
We mentioned that these are hybrid devices but what does that mean?
Well, the heat pump is used whenever possible, but integrated controls will flick over to regular resistance heating if the demand for hot water is increased. This can also be initiated if the ambient temperature isn’t high enough.
You’ll usually get a storage tank, fan and compressor rolled into a single unit.
This type of water heater works best where year-round temperatures fall in the range of 40 to 90 degrees F.
Heat pumps last anywhere from 10 to 15 years under normal conditions.
With this type of water heater, it pays to spend a little more to get a unit that will last longer.
- Since heat pump water heater don’t constantly heat water, you’ve got the ability to save several hundred dollars a year on your power bills, as much as $300 annually according to the EPA
- Some utility companies offer incentives for installing this type of water heater to offset the higher costs in pursuit of energy efficiency
- Purchase and installation can be less expensive than installing a traditional heater
- Many tanks are stainless steel and guaranteed for life
- HPWHs work well in garages or other unconditioned spaces although you will need a condensate line pump if installed in a basement
- With digital controls, you can tweak your preferences between efficiency and rapid recovery for maximum flexibility
- Condensation tends to build up and this needs routinely removing
- There tends to be a constant thrum emitted from HPWH roughly the same volume as a dishwasher which can be annoying
- HPWHs don’t function efficiently in places with extreme climates
- The air filter needs changing every couple years
- Since most HPWHs are bulky, it’s highly likely you’ll need modifications to plumbing for installation
What To Look For When You’re Buying a Heat Pump Water Heater
Sizing and First Hour Rating
To determine the size of the HPWH you need, you should consider:
- The energy you’ll use to power the system
- The size of your house along with the number of bathrooms
- The peak flow rate (the number of appliances that will be working at the same time calling for hot water)
- Your optimal required water temperature when everything is working at the same time
The first hour rating refers to the amount of hot water kicked out per hour when starting out with a full tank.
This value is related to:
- The tank capacity
- The size of burner
- The type of burner
The larger the tank, the greater volume of water will be collected.
The larger the burner, the greater the water production.
The type of burner is crucial since both power and efficiency vary.
By considering all these elements, you should be able to choose a unit that amply satisfied peak hour demand.
You’ve got a number of options when it comes to the fuel used for HPWHs
- Natural gas
- Solar energy
- Geothermal energy
- Fuel oil
Think carefully about the cost and availability of fuel both now and on into the future. Think about what type of fuel you’re currently using in your home.
Efficiency and Energy Factor (EF)
As with other types of water heater, efficiency is expressed in terms of Energy Factor (EF).
This value accounts for:
- Heat lost during the cycle due to storage
- Speed of heat transfer from pump to water
The higher the EF value, the lower your overall operating costs.
The very best heat pump water heaters are rated at 2.0 translating to 200% efficiency. Yes, you read that right, 200%. The reason for this elevated percentage is because EF compares how much hot water is produced by a unit of electricity consumed over the course of a given day. This 2.0 rating simply shows that the heat energy produced is double the quantity of energy consumed.
Since the average heat pump water heater is both taller and wider than a conventional heater, you’ll need to make sure you’ve got enough space to accommodate it.
You should seek advice from an installer and remember to factor in leaving enough room for servicing the air filter.
3. Solar Water Heaters
If you’re looking for an eco-friendly approach to water heaters, a solar model is the obvious choice.
How They Work
Like any solar-powered appliance, heat is absorbed directly from the sun and used to heat the water in your home.
Solar water heaters have a solar panel to trap the sun’s rays in order to heat the water. The water is stored in a tank.
Some more upscale models have circulation features but this is not common to all solar heaters.
A properly maintained solar water heater has the capacity to last for decades.
- Solar heaters use totally renewable energy to heat your water
- A first-class sustainable energy solution for heating the water in your home with a reduced reliance on non-renewable sources of energy
- You can generate realistic savings of hundreds of dollars annually
- The sizeable initial investment doesn’t make much sense unless you plan to stay in your home for some time to come
- You should consider the need for a backup water heater in case of serious storms or for use overnight
What To Look For When You’re Buying a Solar Water Heater
Amount of Hot Water You Need To Generate
The effectiveness of any solar water heating system is significantly impacted by lifestyle:
- How big is your family?
- Do you have a great demand for hot water, especially during the day?
If you do have a bigger family with heavy needs for hot water, an active system with a bigger collector makes most sense.
For singles and couples with minimal requirements, batch or passive systems work well.
As a general guideline, multiply the number of occupants of your household by 18 gallons. This figure will help you determine the size of collector you need and reserve tank requirements.
What’s the difference between active and passive systems then?
Passive or Active System?
With a passive system, a simple principle is harnessed and put to work:
- Warm water rises while cool water sinks in order to circulate hot water throughout the system
This type of simple, scaled-down system uses a pump to help push the water.
Active systems call for more equipment including a circulating pump along with other components driving the price up while also introducing more complexity and more chance of things going wrong.
These more complicated systems call for electricity to drive the pump leading to a drop in energy-efficiency. The upside is that you’ll get an abundance of continuous hot water thanks to the circulating pump.
Where You Live and The Climate
The configuration of most solar water heaters is grounded on an expected output of water relative to the climate in question.
In areas like Southern California, Arizona or Florida, even a pretty small solar system can generate huge quantities of hot water.
Colder regions call out for larger collectors and an active system.
Another factor you should bear firmly in mind is any risk of freezing. Automated system monitoring and/or drainback tanks can mitigate the risk of a burst pipe in the collector.
You should carry out periodic maintenance once your solar water heater is up and running.
Maintenance falls in 2 parts, inside and outside the home.
- Check the pressure relief valve and ensure it’s not stuck completely open or closed
- Make sure the pipes are completely free of mineral build-up
- If you have an active system, check the pumps operate when the sun is shining
- Ensure the collector remains clean and is not shaded
- Make certain any roof penetrations are properly sealed
- Check the sealing and glazing around the collector are not yellowed or cracked
- Make sure the wiring and piping are connected and insulated
- Monitor all fasteners connecting the collector to the roof
It’s a common misconception that all solar water heaters are ruinously expensive. This is not always the case.
You should also consider a solar system as an investment and look to the ROI you can achieve rather than obsessing purely over the bottom line.
You can build out a batch system for as little as a couple hundred dollars while the better commercial systems made for warmer climates need not be too costly.
It’s key when budgeting to speak with a plumber and also to check up on local housing codes so you can avoid the unpleasant surprise of hidden costs later down the line once you’re committed.
Installation: Choose a Certified Contractor
Your best bet for installation is to source a local contractor who can conduct a feasibility assessment, install your solar system then conduct routine maintenance.
Due to the rigors of the plumbing involved and the difficulty of working on a roof, it’s not advisable to install a solar water heating system yourself.
It’s ideal if the contractor is certified by the NABCEP (North American Board of Certified Energy Practitioners). (3)
ENERGY STAR certified solar water heaters help you qualify for a Federal tax credit equating to 30% of the cost of the system’s installation to a maximum of $2000. (4)
4. Condensing Water Heaters
Much like a traditional heater, most condensing gas heaters have a tank but from here functionality differs substantially.
You can get tankless models, too.
A condensing heater is similar in principle to a condensing furnace except it heats water instead of air.
How do they work, exactly?
How They Work
Rather than pushing hot exhaust gases through the flue – this is a real waste of energy – the heater blows the gases through a coil housed at the bottom of the tank.
As cold water enters, it flows around this coil and absorbs most of the heat.
While it’s a storage tank system and you’ll suffer from some standby loss, this is more than compensated by the increased overall efficiency.
By removing the heat from burning fuel and cooling down the by-products of combustion, venting becomes cheaper.
When the water vapor produced by the gas burning in the boiler condenses back into liquid water again, latent heat from this vaporization is released. Since this is a significant source of energy, condensing water heaters enjoy efficiency ratings of up to 98%.
A condensing water heater lasts 8 to 12 years.
Replacement is generally recommended after 10 years.
- Condensing models are the most energy-efficient of all gas-powered tank-style systems
- With a remarkable first hour recovery rate, there’s no chance you’ll run out of hot water
- Although expensive, you’ll enjoy reduced operating costs
- Ideal for homes with a high demand for hot water
- You can make use of cheaper PVC venting thanks to the exhaust gases coming in at lower temperatures
- At 90% thermal efficiency, performance is markedly better than conventional gas heaters
- Reduced NOx and CO2 emissions mean condensing water heaters are very eco-friendly
- Condensing heaters are undeniably expensive running you several thousand dollars
- You’ll need to think about rejigging your gas line and also venting
- Installation in general is complex
Why Should You Consider a Condensing Water Heater
If you’re looking for a tankless condensing water heater, follow our advice above in section one above concerning tankless water heaters.
Maybe you’re wondering if a condensing heater is really worthwhile? They’re certainly an expensive proposition at the point of purchase but, over time, you’ll recoup that investment through dramatically lowered heating bills.
What To Do Next
Have you decided which type of water heater makes the best fit for your home?
Whether you choose a tankless or tank-style system and whatever the fuel source, buying the best water heating unit for your home is not something to rush into.
Check out our reviews and buying guides for plenty of detailed information to help you and don’t hesitate to get in touch if you need any further assistance.