Tankless Truth: Tankless Water Heaters Are Affordable to Purchase and Install

With improved technologies, positive impacts have been made on the cost of tankless water heaters.

by Tim Greer 

While designing a plumbing system, the cost of water heating appliances and their installation may come into consideration to meet budgets. As expenses are compared during system design, the question of whether to design the system with a tank water heater vs. a tankless water heater may be brought to the forefront, and biases toward one appliance over the other can influence decisions, while the many myths associated with tankless water heaters may also sway minds. One such myth is this: Tankless water heaters are expensive to purchase and install.

Affordability of Tankless Units

On top of increased efficiencies with energy, noncondensing tankless water heaters have become comparable in price with traditional tanks over the years. This shift in the price gap is mainly due to the increasing cost of manufacturing materials, and with the current economic climate and supply issues experienced across the globe, material prices have been higher than in recent years.

When looking at gas water heater price examples online, a noncondensing tankless water heater can be found as low as $700, while tanks are priced at around the same. What should also come into consideration are the cost efficiencies provided beyond the initial purchase of a tankless water heater, such as energy savings, space savings, and product longevity. All add up to an affordable plumbing solution.

Energy Savings

Most common residential tanks have a thermal efficiency of around 60–65 percent, whereas noncondensing tankless units are around 85 percent thermally efficient, using less fuel and energy to function. Additionally, these increases in thermal efficiency often qualify for local government and/or energy provider rebates where common tanks do not—thus lowering the total cost of ownership even more.

Space Savings

A tankless water heater is about the size of a suitcase, which creates space savings, especially when multiple heaters are needed, as they can be hung on a wall or even installed outside. This is particularly valuable when it comes to residential new construction.

Lifespan Savings

Based on a study by the U.S. Department of Energy, the typical lifespan of a tank water heater ranges from 10–15 years, whereas a tankless water heater can last up to 20 years. Additionally, key components of a tankless water heater can be easily replaced, which can extend the lifespan even further.

Cost-Effective Installation

Manufacturers are always looking for ways to make installations smoother, including providing product training for professionals and always listening to the feedback provided by those using the products daily.

For example, venting was a large expense from both a materials and labor standpoint, ranging in cost from $200 to as much as $1,000. The high cost was due to some tankless units being compatible with only 3- or 4-inch PVC in comparison to the much more cost-effective 2-inch PVC. Over the last 50 years, the cost of venting a tankless unit has decreased significantly (vent systems now can potentially be less than $100). This change was brought on by continuous innovations, making the venting portion of the installation process much more affordable. Many manufacturers heard the concerns from those working in the field regarding these high costs inhibiting customers from installing tankless units, and they responded accordingly to create more affordable solutions. For example, Rinnai launched its Sensei Models, which are compatible with 2-inch (Schedule 40, solid core) PVC.

When a plumbing system requires multiple units, the time needed for installation often increases. To simplify the installation and give back valuable time, tankless manufacturers launched preassembled rack systems. Shipped in easy-to-move containers, the rack systems simplify the process of installation by removing the additional step of assembly at the jobsite and reducing the resources and labor needed for installation.

Additionally, significantly more installers have been trained and are experienced in installing tankless water heaters today than those 10 years ago. Well-trained professionals can reduce installation costs to the homeowners as they can reduce the amount of labor time required to complete the job.

With improved technologies, positive impacts have been made on the cost of tankless water heaters. Hot water technology is not expensive but is rather an affordable water heating solution.

About the Author

Tim Greer is a Technical Training Developer and instructor with Rinnai America.  With more than 20 years in the mechanical and electronics industries, he began his journey with Rinnai over 16 years ago. He has held various roles in technical support, commercial service, product management, and training development. To learn more about the other common myths associated with tankless water heaters, visit rinnai.us/tanklesstruths.

The opinions expressed in this article are those of the author and not the American Society of Plumbing Engineers.

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