Difference between tankless water heater and storage tank water heater

Tankless Hot Water Heaters vs Tank Storage Water Heaters

Back in the day, Calgary homeowners didn’t have much choice. A storage tank in the basement or closet was the way to look after the family’s hot water requirements.

Nowadays, tankless water heaters (sometimes called “demand water heaters” because they heat water on demand) are a popular alternative, but it can be confusing to decide which is more suitable for your home.

Our professional technicians, we weigh up the pros and cons of each type of water heater to help you decide.

Advantages and disadvantages of tankless & storage tank water heaters

Before we examine how each type of water heating system works, let’s take a look at the main pros and cons of each type.

Tank storage water heaters

Main advantages
  • Lower purchase and installation costs than tankless water heaters.
  • Can handle more gallons per minute than tankless.
  • In a gas-fired heater, the pilot light heats the water in the tank so the energy isn't wasted.
  • They generally heat all of the water in the tank all of the time - regardless of whether it is used or not.
  • Once they are empty, you’ll be left with cold water until the tank can re-heat.
  • Standing heat loss may result in substantial energy loss (less energy-efficient).
  • They do not usually last as long as tankless heaters (10-15 years).
  • They take up more space than tankless heaters.

Tankless water heaters

Main advantages
  • They only use energy when you turn on the tap.
  • For homes that use low amounts of hot water daily, tankless water heaters can be considerably more energy-efficient.
  • For homes that use larger amounts of hot water, tankless can still work in many cases.
  • Less heat loss than traditional water heaters.
  • Typically, they last longer than tank storage heaters (20 years plus).
  • Easily replaceable parts – few repair issues.
  • Very space-efficient.
  • Higher purchase price and installation costs.
  • If your home has a high throughput at particular times of day (gallons per minute is too high), you may be left with lukewarm water.
  • Gas-fired tankless water heaters with a standing pilot light can waste energy unless you turn it off when not in use or choose a model with an intermittent ignition device.

How does a storage tank water heater work?

A traditional storage tank water heater is typically around five feet tall, two feet wide, and holds around 30 to 60 gallons of water.

The average home in Calgary has a 50-gallon capacity tank but if you are not sure about the capacity your home requires, the Alpha Plumbing team can help you calculate this.

Water storage tanks do take up space. That may not be a problem if you keep yours in the basement but if you need to squeeze it into a closet, things can get tight, especially with the new insulation regulations adding extra inches to the height and width of storage tanks.

The water is heated using natural gas, electricity, fuel oil, or propane. Storage tanks continuously heat water and maintain a full capacity of hot water even when it’s not needed nor used - one of the main disadvantages of such systems.

How does a tankless water heater work?

A tankless water heater heats the water on-demand as it passes through the unit. This requires no tank storage and therefore reduces the space needed (most are about two feet tall and around a foot wide).

The absence of a tank also eliminates the energy losses that occur naturally from standing hot water.

Tankless water heaters can heat the whole house and run on electricity, natural gas or propane. A heat exchanger rapidly heats the water to the required temperature.

Efficiency of storage tank water heaters vs tankless heaters

The annual energy consumption cost of conventional storage tank water heaters is generally reasonable for gas models and moderate for the electric types. Electric models are considerably more expensive to run because of the higher costs of electricity when compared with gas.

Tankless water heaters are more energy-efficient than their traditional cousins and rate higher in most tests. Typically, the newest tankless models will operate at 96-98 percent efficiency.

As with the tank storage heaters, the electric models are more energy-efficient but because of the higher electricity costs, annual running costs are also higher.

When are tankless water heaters best?

Tankless water heaters cost more than traditional storage tank systems to install and are best suited for homeowners who want to:

  • Reduce ongoing energy bills (typically between 15 and 60 percent savings).
  • Maintain a steady supply of hot water – it is heated on demand (in large households, a second water heater may be required).
  • Save space – most heaters are wall-mounted and take up little space.
  • Be eligible for government rebates (may be applicable for some high-efficiency models if you are replacing a low-efficiency system).
  • Reduce the chance of flooding.
  • Keep their system for 20 years or more.

In short, investing in a tankless water heating system may make a lot of sense if you plan to remain in your home for many years, you have a large family of water users, and you are looking for a small, compact, low-maintenance unit that saves on the monthly bills.

When are traditional water tanks best?

Cheaper and often easier to install, traditional storage tank water heaters may be best for homeowners with space in the basement for a tank and who want to install:

  • A budget-friendly, maintenance-free option
  • A system that provides a continuous supply of hot water around the clock for a smaller household with few capacity issues
  • A system that will last 10-15 years

Note that many modern storage tank systems are more efficient than older ones and some are Energy Star certified.

Five things to consider when deciding tankless vs tank

It's not just about balancing installation costs versus running costs – though that’s an important factor in your decisions.

Factor in the following five considerations:

  • How long do you plan to be in your home? There’s no point investing in a more expensive tankless system if you are not going to be there for very long.
  • What are your total hot water usage requirements? If you don’t yet know this, get an estimate from the team at Alpha Plumbing before you make a decision.
  • Do you have hard water? If you live in Calgary, this is practically a given – and it can play havoc with a tankless water system as minerals can build up and damage efficiency. It’s best to address this with a whole-home water softening system.
  • Are you planning on servicing your system? A tankless water system generally requires flushing at least once a year. They need more maintenance than most storage tanks.
  • How important is energy efficiency? If it’s a major factor, you’ll probably lean towards tankless.

Need help with your water heating system?

If you need assistance with selecting, installing, repairing or maintaining your water heating system, call Alpha Plumbing on 403-470-5785 to arrange an honest assessment from a qualified technician.

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