Until recently, I didn't know that tankless water heaters existed. I thought that cold showers were an unavoidable part of life. If someone had showered before me or if the dishwasher was running, I dreaded hopping into that icy cold water.
Now, I know that with a water heater, I can have hot water instantly any time a faucet is opened. No more cold showers!
They can also save me money. Tankless water heaters are more compact, energy efficient, and have longer lifespans than water heaters with bulky storage tanks.
Traditional tank water heaters store between 20 and 80 gallons of heated water, with 50 gallons being the most typical size. That may seem like quite a lot of water, but it can run out quicker than you'd imagine — especially in larger households.
A shower usually consumes around two gallons of water per minute, so a 10-minute shower would use 20 gallons. If someone else in the same home takes an equally long shower, that's another 20 gallons used up. For a house with a standard 50-gallon water tank, that would mean 80% percent of the unit's capacity could be gone in a matter of minutes. And when the dishwasher or washing machine is on, or when yet another person takes a shower, it's easy to see how my home always ran out of hot water before I knew it.
Tankless water heaters, on the other hand, detect when someone opens a faucet and heats the water on demand with electric or gas power. As long as I don’t run more appliances or faucets than the heater can handle, I can have an endless supply of hot water.
Tankless vs. Tank Water Heaters
The benefits of a tankless water heater aren’t just limited to the amount of heated water it can provide. Regular tank heaters are constantly running to maintain the stored water heated. Since a tankless heater only operates when there is a demand for hot water, the unit remains shut down at all other times. This makes them about 24 to 34% more energy efficient, according to the U.S. Department of Energy.
Tankless heaters are also significantly smaller. My tank heater is large, clunky, and in the way. These can measure more than 6' high and 20" in diameter. But a tankless heater is around 20” high and 16” wide and can be attached to a wall, or even inside a closet.
Another bonus in my book is that when it comes to lifespan, a tankless heater will most likely outlive a tank one. Tankless units often last more than 20 years, compared to 10 to 15 years for tank units.
However, these benefits come with a higher upfront investment. Tankless water heaters can cost upwards of $2,000, versus $400 to $600 for a tank heater. Installation costs for tankless water heaters are generally more expensive as well, often ranging from $1,000 to $2,000 depending on how much retrofitting is needed.
In my opinion, though, this upfront investment is well worth it as it can save me money in the long run through lower energy and gas bills.
A tankless unit’s overall heating capacity also depends on the groundwater temperature of your area. In places where the water source is very cold, the unit will produce fewer gallons of hot water per minute. So, a tankless heater may not work as well when temperatures drop.
A traditional tank heater, meanwhile, will always provide roughly the same amount of hot water year-round, though it might take a bit longer to heat up the incoming water if it's colder than normal. Factor all of this in when deciding to go with a tankless or tank water heater.
Tankless Water Heater Buying Guide
In my experience, figuring out which tankless water heater meets your household’s demand comes down to how much hot water will be consumed during peak usage, along with the expected “temperature rise” need, which is how much the incoming water has to be heated to reach the desired temperature.
The fuel type a heater uses also plays an important role, as it determines a unit's heating capacity, along with installation and maintenance costs. While creating this guide, I found that you should look at these features and specifications when shopping:
• Gallons per minute (GPM). The GPM, or water flow rate, is the measurement of roughly how many gallons come out of a faucet per minute.
Before purchasing a tankless water heater, determine how many GPM of hot water your household needs. To do this, you must take into account how many appliances or faucets are typically used at the same time.
For example, a standard shower consumes around 2 GPM and a dishwasher around three. If you’d like to run two hot showers and the dishwasher at the same time, you’d need a heater that can handle at least 8 GPM.
I've found that households of three people or less can usually get by with a 6 GPM water heater, while bigger households should consider a heater with at least 8 GPM.
• Temperature rise. The temperature rise is the difference between the temperature of inlet water (water coming into the pipes) and your desired temperature for hot water. If you live in an area where the groundwater is 60° and you want it to be heated up to 100°F, your heater must be able to boost the incoming water temperature by at least 40°F.
The actual GPM of a unit can fluctuate depending on the temperature rise needed. A tankless heater will produce its maximum capacity in hotter regions where groundwater temperatures are 70°F or above. Less hot water will be available in colder climates as the unit struggles to raise the water temperature. Basically, the colder the incoming water, the more the unit has to work to heat it, thus producing lower GPM.
Manufacturers usually include a heater’s GPM capacity based on the required temperature rise in the owner’s manual or product specification sheet. These can be downloaded on the product page of the manufacturer’s website.
• Fuel type. Tankless water heaters can run on natural gas, propane, or electricity.
Gas-powered tankless water heaters have a higher heating capacity than electric heaters. Most gas heaters supply between 8 and 11 GPM, while electric heaters usually provide 7 GPM at most. As I said above, a high GPM is crucial for big households and colder climates.
Gas heaters may be cheaper to operate as well, depending on the price difference between gas and electricity in your area. However, they do involve a larger upfront investment. This type of heater can cost anywhere between $1,000 and $2,000, and their installation is also costlier, especially if your home doesn't already have a direct gas line and a venting system in place. But, if you live in a cold climate like me, I think this would be the best option.
Electric tankless heaters, on the other hand, have much lower upfront costs. There are models that cost around $700 or less and can supply enough hot water for a household of four. They are also more energy efficient than gas-powered heaters (around 5% or more), and their installation is simpler and cheaper, as is their yearly maintenance.
On the downside, electric heaters might struggle to keep up in colder climates. Since they have lower heating capacity than their gas counterparts, their overall GPM can drastically decrease in cold weather. For example, an electric heater with a 6 GPM might be more than enough when groundwater temperatures are at 60°F or above. But if groundwater temperatures drop to 40°F or less, its capacity may drop to only 2 GPM. I think electric heaters would be preferable in warmer clients so that you can save money on utility bills and installation costs.
Reviewing the Top Tankless Water Heaters of 2023
1. Best overall: Rinnai RSC199iN Smart-Circ Tankless Water Heater
List Price: $1.854.74
The gas-powered Rinnai RSC199iN is built for maximum efficiency. Since it’s a condensing tankless water heater, it captures and reuses exhaust gas to take full advantage of its heat, granting it Energy Star certification.
Tankless water heaters heat water the instant someone opens a faucet; however, I've noticed that hot water may take some time to arrive at fixtures located far from the heater. In most cases, that means that water is wasted while you’re letting it run, waiting for it to heat up. I love that the RSC199iN avoids this waste by featuring a built-in recirculation pump that returns unused cold water in the pipes back to the heater. This can save me money in the long run.
The RSC199iN has some great technological features too. It's Wi-Fi capable, so you can turn on the pump (or set a schedule) with Rinnai’s mobile app. The heater responds to Alexa or Google Home voice commands. Additionally, users can adjust temperature, monitor performance, and receive periodic maintenance notifications via the Rinnai app.
The RSC199iN (which sells for around $1,800) runs on natural gas and can produce up to 9 GPM of hot water. This GPM is enough to support two showers and a dishwasher at the same time. However, a higher GPM is recommended for households with more than four people.
The RUR199iP (approximately $2,000) is part of the same product line and can handle up to 11 GPM, making it a good option for larger households. For homes with propane lines, take a look at the RUR160iP or RUR199iP.
- Temperature and recirculation pump can be controlled from your phone
- High-performance circulation valve provides hot water in seconds
- Easy to install and use
- Compact design for convenient placement
- May lose Wi-Fi connection if far from the router
- Could be costly to install and maintain
2. Editor’s pick: Rinnai RU130iN Tankless Water Heater
List Price: $1,421.46
The RU130iN, also from the Rinnai brand, is an Energy Star-certified heater designed to recapture and reuse exhaust gas for optimum energy efficiency. Running it at around 4 GPM will cost you only about $133 per year!
Keeping the heater’s capacity at 4 GPM or less is only my efficiency recommendation, though. The RU130iN can actually heat up to 7 GPM of water — enough to operate two low-flow showers and the dishwasher simultaneously in hotter regions. Even in colder regions with groundwater temperatures around 50°, it can produce hot water sufficient for two showers at once.
While the RUR130iN doesn’t have Wi-Fi capabilities out of the box, you can add them by buying the Control R Wi-Fi Module ($160). Once installed, Rinnai’s mobile app allows you to control the heater’s temperature and receive maintenance notifications. You could also activate the heater’s recirculation system with the app (provided you install an external pump).
The RU130iN is part of Rinnai’s RU line. This model operates with natural gas but the RU line also has units that run with propane. If your household has higher hot water needs, there are models from the same line capable of 9, 10, and up to 11 GPM.
- Compatible with Rinnai’s Wi-Fi module (sold separately)
- Space-saving design
- High efficiency, Energy Star-certified unit
- Easy to install, even for knowledgeable DIYers
- Condensation fan can get a bit loud
- Potential need for extra GFI-protected 110V outlets
3. Best for low prices: EcoSmart Eco 18 Electric Tankless Water Heater
List Price: $425.00
Retailing for $425 or less, the EcoSmart Eco 18 is powerful enough to heat up to 4.3 GPM of water — plenty for a household of two in warmer climates. It can also supply hot water for a single shower at a time in areas where groundwater temperatures are as low as 52°F.
This electric tankless heater self-regulates energy consumption throughout the day, so it won’t drive up your electric bill as much. A flow sensor detects how much water needs to be heated depending on the fixture that’s being used, and then adjusts to use only the amount of energy necessary to meet the demand and the desired temperature. Adjusting the output temperature is simple; a built-in digital control allows you to set the temperature in increments of 1°F from 80°F to 140°F.
Keep in mind that its 4 GPM capacity may be insufficient for households of more than two people, or in very cold climates. For those cases, I recommend the Eco 27 ($629) as it can heat up to 6.3 GPM.
- Low cost to buy and operate
- Unlimited hot water, no need to worry about running out
- Space-efficient and aesthetically pleasing design
- Precise temperature control
- Heating capacity can decrease in colder climates
- Replacement parts are difficult to find
4. Best electric tankless water heater: Rheem RTEX-24
List Price: $539.95
Although gas-powered tankless heaters tend to be cheaper to operate than their electric counterparts, they can be costly to install. Additionally, not all homes have gas lines and venting systems. If this is your situation, I suggest an electric water heater instead.
Rheem electric water heaters are well-known for their durability, efficiency, and high capacity. Case in point: The RTEX-24 can produce up to 6 GPM, adequate for a household of up to four. For around $600, it can easily supply big appliances (like a dishwasher) and still have heating power left for a shower or several smaller fixtures around a house.
The RTEX-24 boasts a 99.8% energy efficiency rating. With this high of a rating, I wouldn't worry at all about wasting water and money. In comparison, gas-powered tankless heaters are around 90% efficient — if they are condensing models, that is. Non-condensing tankless water heaters are only about 80% efficient.
This unit achieves peak energy efficiency by self-modulating the power output. It detects the water flow requirements of running faucets and adjusts the power output to use only what’s needed at that moment.
- Self-adjusts power usage for optimal energy efficiency
- Dial-in water temperature to the degree
- Lower electricity use for cheaper bills
- Suitable for up to two showers at once
- Installation may be time-consuming and expensive
- Not Energy Star certified
5. Best point-of-use water heater: Bosch Tronic 3000 Water Heater
List Price: $201.21
Gas or electric tankless water heaters are usually installed in the basement or utility room, and they supply hot water to all faucets and appliances around a home. On the other hand, a point-of-use water heater is installed at a specific water source, such as a shower or sink, and only heats the water at that location.
This may seem unnecessary if you already have a central water-heating system. But sometimes heated water takes up to 10 seconds or more to reach all parts of the house. This delay can waste water in the long run, and this is where point-of-use heaters come into play.
The Bosch Tronic 3000 can be installed under a sink, inside a cabinet, or in any other concealed location (as long as its supply line reaches its target faucet). The unit will provide up to four gallons of hot water at that fixture until hot water from the main heater arrives. This cuts down on long waits and reduces the amount of water that's wasted. I would install this in showers far from the main heater so I don't have to wait for the water to heat up. Some may use it in outdoor bathrooms or sheds.
Another perk to this type of heater: no professional installation is required. I love that I can just plug the unit into a 120v standard plug and be good to go.
- Doesn’t require professional installation
- Provides hot water instantly
- Saves energy and water
- Doesn’t need a dedicated circuit or breaker
- Calcium build-up may occur with hard water
- Some users complain of leaks
People Also Ask
Are tankless water heaters more efficient?
While tankless water heaters may have a high cost upfront, they can save you money in the long run. Users can see anywhere from 30 to 70 percent in savings after making the switch.
Do tankless water heaters need a vent?
Tankless water heaters, especially gas ones, do blow out steam and need a place to vent.
Does a tankless water heater mean an endless supply of hot water?
Basically, yes! Because the heater works based on demand rather than capacity, it heats up water as you need it.
Can I take a long shower with a tankless water heater?
Yes! It shouldn't run out of hot water since it is constantly heating the water on demand.
What is the maintenance of a tankless water heater?
To avoid damages, I recommend servicing it once a year. If you have hard water in your area, twice yearly may be better.
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