An on-demand or tankless water heater is among the hottest trends in home plumbing. In fact, demand has been so high that manufacturers have struggled to meet it. What’s interesting is that tankless water heaters aren’t exactly new. They’ve been available for a long time, but widespread adoption has only recently occurred. Let’s look at the innovations and features driving this interest.

Practically Endless Hot Water

The fundamental drawback to a traditional tank water heater is its limited hot water supply. For the average home, that supply is between 40 and 50 gallons. If you size the tank appropriately for your household, you may rarely have to deal with that limitation. However, there are exceptions. Consider a scenario where you have family over for the holidays and use much more water for showers, cleaning dishes, and laundry.

Alternately, on-demand water heaters offer a limitless supply of hot water. You’ll always have hot water as long as your power is on and you have access to water through the municipal system or your well. However, tankless water heaters are limited in terms of their flow rate. The industry measures the rate in gallons per minute (GPM). This limitation means a tankless water heater may be unable to supply hot water to an appliance like a dishwasher while multiple people are showing. In this scenario, the demand for hot water would exceed your on-demand water heater flow rate. When you invite family or guests to your home, you may be unable to run your dishwasher during the morning rush. However, everyone will enjoy hot water regardless of how many showers are taken consecutively.


A tankless water system offers versatility to homeowners thanks to its capacity for expansion and adjustment. Unlike traditional water heaters with limited tank sizes, tankless systems have solutions for households with larger families who use a lot of hot water during their daily routines. For instance, homeowners can easily enhance their system’s capacity by purchasing a unit with a flow rate that will meet their needs. Additionally, supplementary measures such as installing multiple units in parallel or incorporating boosters can further augment the system’s capacity. This will ensure consistent hot water availability even during peak usage times.

Energy Efficiency

According to the U.S. Department of Energy (DOE), on-demand water heaters are between 24% and 34% more efficient than traditional systems. In addition, the DOE suspects that those numbers will soon improve due to innovations on the horizon. The reason for the energy efficiency difference is that on-demand hot water systems only heat water when you need it. Even when you’re not using hot water, a traditional water heater runs about five hours a day to keep the water in its tank hot. This constant heating makes them relatively inefficient.

Lower Monthly Water Heating Costs

The better energy efficiency of on-demand hot water systems translates into less money spent on hot water each month. The question is how much savings you can actually expect. The DOE estimates an 8% to 14% savings for a home that uses approximately 86 gallons per day. That’s an annual savings of between $44 and $108.

The other benefit is that, unlike a traditional unit, you can install a tankless water heater with a greater flow rate to increase hot water capacity without necessarily incurring higher monthly costs. You will only pay to heat the water you use rather than pay to keep more water hot, as would be the case with a traditional system.

Reduced Carbon Footprint

Another compelling reason to consider a tankless water heater is its environmental impact. With better energy efficiency, these systems contribute to a smaller household carbon footprint. While some may argue that the impact of a single home’s water heater is negligible, the collective effect of the widespread adoption of tankless systems could significantly reduce the country’s contribution to greenhouse gas issues.

Longer Lifespan

The average tank water heater lasts between six and 12 years. The industry recommends that homeowners replace them after 10 years. In some cases, You can squeeze 15 years out of a traditional hot water system, but those units are rarely efficient after a decade of use. Alternatively, the average tankless water heater lasts between 15 and 20 years. There is no industry rule regarding replacing them because they are efficient until the end of their useful lifetime. As long as your tankless hot water is well-maintained and running well, it’s worth keeping.

Lower Total Cost of Ownership

Tankless water heaters do cost more to install, and it’s certainly a consideration. However, for most households, the trade-off is worth it. A tankless system comes with a longer and more robust warranty and also costs less to run on a month-to-month basis. Additionally, they last longer, and you won’t need to replace them as often as traditional systems. A tankless system actually costs less over the life of the unit to have hot water in your home.

Tankless Water Heaters Are Space Efficient

Even though tank water heaters have gotten smaller over the years, they’re still quite large. Many homes even have a small room dedicated to the water heater. You can put it out in the garage, but it takes up a lot of precious space there as well. The footprint of an on-demand system is much smaller. If you install it in your garage, you may barely notice it. Many people even put it in the attic, so it’s completely out of site. Tankless water heaters make sense for homeowners where space is at a premium.

Natural Gas Is an Option

Tankless water heaters can run on natural gas instead of electrical power. In most places, installing a gas-powered, on-demand hot water heater results in lower energy bills because of the high cost of electricity. In addition, many gas tankless water heaters are even more efficient than their electric counterparts. You even have the option of condensing models. Condensing or high-efficiency gas water heaters reclaim heat energy from the exhaust for even better performance.

Federal Tax Credit

The U.S. Environmental Protection Agency (EPA) rates appliances for energy consumption. The EPA certifies systems that perform well through its Energy Star program. The Energy Star label lets you know that if you invest in an approved product, it will save you more money than standard models over its lifetime. The federal government offers the Energy Efficient Home Improvement Credit to encourage people to upgrade to Energy Star appliances. Many tankless systems on the market allow you to claim the EEHIC. It is worth 30% of the installation and equipment cost up to $600.

Local Sustainable Energy Rebates

The EPA website lists energy rebates for water heaters and other appliances. You can search for these rebates based on your zip code. You can even claim multiple rebates if they’re available. The groups offering these include utility companies, local government agencies, and non-profit organizations. The nice thing about a rebate is you don’t have to wait for your taxes. You can claim it right away.

Tankless Water Heater Pros Serving Central Kentucky

At Absolute Services, we have been serving the residents of Louisville and the surrounding areas since 2008. We install, repair, and maintain heating and cooling systems. Additionally, we provide plumbing, electrical, and garage door services. Contact us today if you have questions about how a tankless water heater can benefit your household or if you need any of our other services.