Why Are Tankless Water Heaters Expensive to Install

19 / 01 / 2020

Switching to a tankless water heater from the traditional storage type is costly because of the needed retrofit and upgrade. Perhaps the entire plumbing should be retrofitted or the gas and electrical lines should be upgraded to raise the capacity.

Will the switch be worth it? Going tankless means saving space and energy. Because of how they work, tankless water heaters (also called instantaneous or continuous flow hot water) are more energy efficient because they only heat water on demand and there’s less heat being lost. In contrast, storage hot water is about heating litres of water on which some will be wasted and some of the heat will dissipate as the hot water goes through the pipes.

Why are tankless water heaters expensive to install

Although tankless types are more energy efficient, the higher cost of installation makes homeowners think twice before making the purchase. The necessary retrofit and upgrade make the installation more technical and complex. Licensed plumbers and electricians (as well as hot water specialists) should do the installation.

For example, the existing water and gas plumbing should first be inspected and upgraded. If you’re starting from scratch, the high plumbing requirements could still drive up the cost. The advantage here is that you save some floor space which could be used for something else. What about the electrical lines? Electric tankless water heaters may require 120 to 160 amps. For safety, performance and reliability, the entire property’s electrical service should be higher than 200 amps.

When it comes to energy efficiency, it could be misleading that some storage types are still more energy efficient than the tankless water heaters. One possible reason for this is that the energy efficient ones (or cheaper to operate) run in natural gas (which is cheaper than electricity). Electrical costs are getting higher and many tankless types still run on electricity. Although it’s an on-demand approach, electricity costs are still high which could offset the tankless’ energy efficiency.

In summary, tankless water heaters are more energy efficient because they do an on-demand heating (as needed). However, the installation cost is quite high because of the necessary plumbing retrofit and electrical upgrade. And whether it’s a tankless or storage type, if the unit is electrical the running costs could still be high. Before choosing between tankless and storage, it’s crucial to ask the professionals first so that you know the upfront and running cost and make sure that you’ll be saving money in the long term.