Switching from a traditional tank water heater to a tankless heater has its benefits, like energy efficiency, space savings, and a consistent supply of hot water. However, the transition comes with a higher upfront cost and potential challenges.
Yes. The initial cost of converting your tank water heater to a tankless is expensive. Tankless water heaters are 3x more expensive than your average tank water heater. However, the energy savings and supply of endless hot water can outweigh the cost for many.
Tankless units are more expensive and swapping all of the lines will take far more time than swapping out tank for tank. You also need to buy special valve setups to be able to properly maintain (flush) the tankless unit, which a lot of installers skip on, and isn't included the unit itself.
Tankless units are more expensive. An electric tankless unit will cost about $500 to $700, roughly the same as a traditional tank model, while the cost of a gas tankless heater runs about $1,000 to $1,200. Beyond the initial cost, the national average for the installation of a tankless unit is slightly over $1,700.
Before you commit to buying a tankless water heater, the primary drawbacks to know include: Higher upfront costs. Tankless water heaters are, on average, quite a bit more expensive to buy and install than tank water heaters. Access to fuel.
Additional Installation Costs
Tankless water heaters are much more complex than traditional hot water tanks. As a result, they require professional installation. If you're switching from a hot water tank to a tankless unit, you will likely need your gas lines rerouted, as well as a larger gas supply line.
The federal tax credit for tankless water heaters can lead to significant savings for homeowners. Eligible tankless gas water heaters must have an ENERGY STAR certification and a UEF of greater than 0.95. Homeowners can claim up to $3,200 in tax credits for eligible home improvements in a single year.
How Much Electricity Does a Tankless Water Heater Use? Many people wonder if tankless water heaters increase electric bills. The answer is no — tankless water heaters can save money on your monthly electric bill because they're 8%-34% more efficient than storage water heaters.
To summarize, a tank to tank installation can last up to three hours to four hours. Tank to tankless may last a bit longer. And going from a tankless to another tankless water heater will usually take no more than three to four hours.
It's important to note that standard homeowners insurance policies typically only cover damage to the structure of your home and personal property. They do not include replacement cost coverage for the heater itself.
Even for homes with high water usage, up to 85 gallons per day, tankless water heaters can offer up to 14% energy efficiency savings. However, while they offer energy savings, the higher upfront costs and installation expenses can result in a long payback period, ranging from 12 to 27 years.
Do I need to replace all my home's plumbing if I install a tankless water heater? Rarely is a complete overhaul necessary. However, you may need to upgrade certain sections of your plumbing, particularly those leading into and out of the tankless unit, to ensure proper water flow and volume.
Because they don't use a storage tank that could be prone to leaks or rusting, tankless heaters tend to last longer than tank heaters. Tankless models can last up to 20 years. These models also experience less daily wear and tear because they don't need to constantly switch on to reheat the water throughout the day.
A tankless water heater that is installed with your current tank-based heater is often called a booster. The benefits of these boosters include: Extended water supply: You'll be able to run hot water for much longer than you would with just your tank.
It's true: tankless water heaters will cut up to 40% off your monthly energy bill. By heating water instantaneously and only when you need it, you and your family members can enjoy continuous, uninterrupted hot water at the same time, along with savings over a conventional tank.
You can't run out of hot water with tankless water heaters – unless, of course, the power supply is off or goes out. However, a tankless water heater can have trouble keeping up with demand if too many things require hot water all at once.
Switching to a Tankless Water Heater
Although switching from a tank-style water heater to a tankless system is a little more involved than just replacing your current hot water tank, our team of water heater experts here at Barnett know how to make switching to a tankless unit feel seamless.
Equipment purchase and installation runs $1,200–$3,500 for tankless heaters versus $800–$1,500 for traditional tanks. Tankless models use 24%–34% less energy when households use up to 41 daily gallons, according to ENERGY STAR.
Yes, you can replace your 40-gallon water heater with a tankless water heater, but you might have to upgrade your gas line or electrical system.
One of the most common questions asked by consumers about tankless water heaters is how long they will last. A tankless water heater can last anywhere from 15 to 20 years with proper maintenance and operation. In comparison, a standard tank water heater normally has a working life of 10 years or less.
Electric tankless water heaters still save homeowners around $44 per year according to the US Department of Energy. Longer useful lives than storage tank water heaters. Tankless water heaters typically last 20 to 30 years, double the forecasted useful life of a storage tank water heater.
If you are looking to increase the value of your home, adding a tankless water heater to your features is a great place to start. According to a study conducted by Zillow, homes with tankless water heaters sold for 4% more than their expected value. On average, these homes also sold 43 days faster than expected.
Water Heater Tax Credit Details.
You can claim 30% of the project cost, up to a $2,000 maximum credit. Heat pump water heaters that have earned the ENERGY STAR are eligible for this credit. You can find a list of ENERGY STAR certified models here.
Tankless water heaters don't always fit into one category. Many of these appliances are Category IV, condensing with induced draft. Some fall into Category III, induced draft with higher temperature non-condensing flue gases.
Federal Tax Credit for Energy-Efficient Appliances
As part of this program, the tankless water heater tax credit for 2024 provides homeowners with a financial incentive to upgrade their water heaters to more energy-efficient models.