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Pros and Cons of Tankless Water Heaters

Time for a new water heater?

You may be considering a tankless, a.k.a. an on-demand water heating system. And while tankless water heaters can save you energy and take up less space, there are certain things to keep in mind before you make the leap. Tankless water heaters have higher upfront costs and may not produce enough water for your household.

Read on to learn what you need to know before making the switch to tankless water heating.


Energy Savings: The number one advantage of a tankless water heater is the energy savings. Tankless water heaters use about 30-50% less energy than traditional tank units since they only heat water when you need it. This is why tankless water heaters are referred to as “on-demand” units. This leads to about $100 savings annually on energy costs.

Continuous Flow of Hot Water: Since tankless water heaters heat the water as it flows through the unit, you will not have to wait for the water to get hot in the storage tank – this continuous flow of hot water can be great for supplying water to a big hot tub or whirlpool. But – keep in mind tankless water heaters may not be able to supply enough hot water if there are simultaneous demands (i.e. filling a bath while running the dish washer). For larger households, you may need a larger, more expensive unit, or two or more tankless water heaters connected in parallel.

Small Size: Tankless units do not have to hold water in a tank, therefore they are much smaller and more compact than traditional water heaters. The smaller tankless units take up very little space and can be mounted on a wall.

Longer Lifespan: In contrast to traditional tank units, which have a lifespan of about 10-15 years, most tankless units last more than 20 years. But, keep in mind that tankless units, just as their traditional counterparts, require proper annual maintenance.

Reduce Risk of Water Damage: Water heater tanks can leak and burst, which can damage property and cause thousands of dollars worth of damage. While tankless water heaters can also leak – they won’t flood your home with 40-60 gallons of water as traditional water heaters can.


Upfront cost: The biggest disadvantage of tankless water heaters is the initial cost. One of the reasons for these high upfront costs are due to the special, dedicated sealed vent system that tankless water heaters require. This means that your existing vent system cannot be used and will need to be replaced with a vent designed for your new tankless water heater.

Gas line upsizing: Another factor that many homeowners do not consider is that their existing gas system may not be large enough to accommodate the increased demand of a tankless system. A plumber should come out to assess your current gas line and determine whether upsizing is necessary.

Not Enough Hot Water for Larger Household: Tankless water heaters produce a continuous flow of hot water, but they often can’t produce enough hot water for multiple uses. This can be problematic if you attempt to take a shower while running the dishwasher at the same time. To avoid this problem, you can install a larger unit or multiple units, however this can get expensive.

For water heater options in Bozeman, Livingston, Belgrade, and the surrounding areas, call Ranger Plumbing & Heating (406) 586-6959 – for the best plumbers in Montana!


  • Thomas My wife and I have been considering upgrading our water heater. I was thinking about going with a tankless to possibly make room for a laundry room sink. We live in Bozeman and have hard water. I have a few questions.. Would I need to install a water softener? Are you aware of any reason that a tankless water heater and a laundry sink can’t be in the same area... I have limited space. And what are the cost and considerations that I should think about before going with a tankless? Reply
    • Matthew S. Lemert - Master Plumber The biggest cost considerations are the unit (or units) themselves, the venting upgrade and possible gas line upgrade if needed. Each home is different and the costs will vary accordingly. The location of the heater and the size of your home will play important roles in the cost and type of installation. Regarding hard water - if you are noticing significant building and scaling around your fixtures, it may not be a bad idea to have a softener installed. Tankless heaters are affected by hard water like any plumbing fixture and will require cleaning and maintenance on a yearly basis. As scale builds up, it affects the units heat exchanger which reduces its performance. Some units actually come with integrated scale detectors and will shut down if significant buildup is detected. Most tankless heaters can be installed near a laundry sink without any issues, however a plumber will want to verify the location prior to installation. Please let us know if you have any further questions or would like to set up a time to have a licensed plumber visit your home to go over pricing and options with you. Reply
  • Kate Hansen It's good to know that saving energy is the number one advantage! My husband and I just recently moved into an older home a couple of weeks ago, and we are wanting to get the water heater replaced because of how old it is and because of how many problems it has. I really appreciate you helping me learn more about the benefits of tankless water heaters for your home. Reply
  • Water Heater Install Great article and well written. The largest cons we've seen have indeed had to do with not enough hot water for a larger household, however, there have been some products that have come to market that have tried to counter this issue. Reply

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