Tankless vs Traditional Water Heaters: The Pros and Cons

For some homeowners, upgrading to a minimalist tankless water heater makes economic sense. For others, sticking with a tried-and-true traditional heater is the best option. The easiest way to make the call is to weigh the pros and cons as they apply to your home and your circumstances. Here are the top pros and cons of both tankless and traditional water heaters.


Tankless water heaters: overview

Tankless water heaters provide hot water on demand, instead of continually heating water and storing it in a tank. When you turn on the hot water tap, the incoming water circulates through an activated heating element, which heats the cold water to the designated temperature. Once the tap is turned off, the heater senses that the flow of water has stopped, and shuts off the heating element.

Tankless heaters come in two main varieties. One is point-of-use heaters, which are small systems that provide hot water for one or two fixtures. The other variety is whole-home heaters that provide hot water to the entire home from one central location. Point-of-use heaters are usually electric, while whole-home heaters tend to be powered by natural gas.

Pros of tankless water heaters

While tankless water heaters are commonly found throughout the rest of the world, they’ve only recently started gaining ground in the United States. The pros of tankless water heaters, including energy efficiency and cost savings, have more and more homeowners looking to make the switch.   

Energy efficiency

Since they only heat water when you need it, tankless water heaters are exceptionally energy efficient. According to Energy.gov, tankless water heaters can be anywhere from 24-34% more energy efficient than traditional water heaters in homes that use 41 or fewer gallons of hot water per day.

Tankless water heaters eliminate standby heat losses, a common problem with traditional water heaters. Standby heat losses occur when a traditional heater continually heats water, even when no one in the home is using it. Since tankless heaters lack the traditional storage tank mechanism, no standby heat losses occur.

Utility bill savings

One of the more appealing benefits of a tankless water heater is the prospect of saving money on monthly energy and water bills. Energy.gov estimates that the average family can save at least $100 dollars a year with an ENERGY STAR certified tankless water heater.

Smaller footprint

With no large storage tank to account for, a tankless water heater is small enough to mount on the wall in a closet or the corner of a laundry room. To put it into perspective, a tankless water heater is usually about the size of a carry-on suitcase. This is part of the reason why tankless water heaters enjoy popularity in other parts of the world, such as Europe and Asia, where families live in smaller homes than the average American.

Longer lifespan

Tankless water heaters can last up to 20 years. That’s a significant increase from the lifespan of a traditional heater, which averages between 10 to 13 years. This helps make a tankless water heater a good investment, as you can expect to rely on it for multiple decades.  

Cons of tankless water heaters

Even with all their benefits, there are several cons that might have homeowners reconsidering their decision to have a tankless water heater installed.

Initial costs

Tankless water heaters often require upgrades or modifications to your home’s natural gas line, as well as an expensive venting system. Electric models may also require an additional circuit. These costs add up quickly, and make a tankless heater an investment with significant upfront costs. However, these costs pay off over time in the form of energy savings.

Complicated installation

The complexity of retrofitting your home’s existing natural gas line in order to accommodate a tankless heater is a barrier that discourages many homeowners from making the switch. If your home is 30 years old, for example, it’s probably not worth the costly headache of upgrading the aging gas piping, meter, and main line to accommodate a tankless heater. If you’re building a new home, installation is much easier as contractors can plan for the heater’s gas consumption during construction.

Electric tankless water heaters are easier to install; however, they rarely have the capacity to serve multiple fixtures at once.

May struggle to meet demand

If you have a large family, you may find that a tankless water heater is unable to meet your day-to-day water needs. When demand is highest, for example, if you’re doing dishes and laundry at the same time, the relatively low flow rate of a tankless water heater might not be able to keep up. To solve this problem, you can install two or more tankless water heaters, but this can get very expensive.  

Traditional water heaters: overview

Traditional water heaters consist of a large storage tank and various components such as a drain valve, dip tube, and various pipes for hot water and pressure relief. Most homes have either a 40-gallon or 50-gallon water heater. Larger capacity tanks are generally used for commercial purposes.

60% of homes in the U.S. use gas heaters, while the remaining 40% use electric or solar powered heaters. In terms of design, the main difference between the two is that gas tanks have a vent at the top to remove exhaust gas, while electric heaters simply have a cable that connects the heater to the home’s electric panel.

Pros of traditional water heaters

Compared to the relatively niche tankless water heaters, traditional water heaters are much more familiar to the average homeowner. They’ve endured as the industry standard for a reason, and they have their fair share of benefits.


There are no surprises when it comes to a traditional water heater. The technology behind them is tried and true, and the vast majority of plumbers have experience with installing, repairing, and maintaining them. If a replacement part is needed, they’re widely available. Whereas tankless water heaters are a rising trend, traditional water heaters are still the standard. This is appealing to homeowners who aren’t interested in being on the forefront of trends, and would rather stick to what’s common.

High flow rate

Washing dishes, doing laundry, and running a bath at the same time? A traditional heater is up to the challenge, thanks to its high flow rate. Unlike with tankless heaters, which can struggle in high demand situations, the large storage tank of a traditional heater holds enough water to support all sorts of household chores simultaneously.

Cons of traditional water heaters

Despite their reliability and commonality, traditional water heaters can have their fair share of drawbacks. This is part of the reason why alternative options, such as tankless water heaters, have grown in popularity.

Shorter lifespan

On average, a traditional water heater lasts between 10-13 years. The lifespan of the heater can be longer if it’s well maintained, or if it’s solar-powered. On the other hand, the lifespan can be shorter if continual damage from hard water isn’t addressed. Either way, a traditional water heater rarely lasts as long as a tankless heater.

Energy waste

The major reason why traditional heaters are considered inefficient is standby heat loss. A traditional water heater constantly heats water, whether you’re using it or not. When water in the tank reaches below a certain temperature threshold, the water is re-heated. When it falls below again, the process repeats itself. This wastes a considerable amount of energy. Newer traditional heaters with more insulation boast lower standby heat loss, but the problem is nearly impossible to eliminate.

Large footprint

Most of the time a traditional water heater is installed in a garage, basement, or large closet. However, smaller homes and apartments may not be able to accommodate the large multi-gallon tank. Traditional heaters also cannot be installed outdoors, since that would cause them to lose too much heat, rendering them inefficient.

Maintenance needs

A traditional water heater isn’t exactly maintenance free. Sediment and mineral buildup in the tank is hard to avoid, especially in places with hard water. If you don’t flush your water heater at least once a year, the accumulated buildup can clog water lines, reduce energy efficiency, and shorten your heater’s lifespan.

On the fence? Contact the water heating experts

If you’re stuck between choosing a tankless or traditional water heater for your home, or have any other questions related to water heating, let us help. Contact the plumbers at Chas Roberts and experience what sets us apart from countless others.