What Is a Tankless Water Heater?
A tankless water heater heats water on demand, providing hot water only when you need it. Depending on the model, it can serve your entire home or a single point of use, such as a shower, sink or appliance. These units are compact, making them ideal for installation in tight spaces like closets.
Choosing a Power Source
When properly sized, tankless water heaters are engineered to deliver a continuous supply of hot water while using less energy since they don’t store or constantly reheat water. Available in natural gas, propane and electric models, you can choose the one that fits your existing energy source and personal preference.
Condensing vs. Non-Condensing Gas Tankless Water Heaters
So, what’s the difference between condensing and non-condensing gas tankless models? Condensing gas tankless water heaters use a dual heat exchanger to maximize energy efficiency. In contrast, non-condensing models use only one heat exchanger. In short, condensing models are more energy efficient because they lose less heat during the water-heating process.
How Does a Tankless Water Heater Work?
When you turn on a hot water tap or start an appliance like a dishwasher, the tankless water heater detects the demand for hot water and begins heating. It calculates the incoming water temperature and adjusts the burner output to reach the desired temperature. When hot water is no longer needed, the unit shuts off, saving energy until the next use. With a tankless system, you’re never limited by the size of a storage tank.
Benefits of a Tankless Water Heater
Here are the major benefits of purchasing a tankless water heater.
Lower Energy Bills
Since they only heat water when needed, tankless units are more energy-efficient than traditional models, helping you save on utility costs.
Longer Lifespan
With proper maintenance, a tankless water heater can last up to 20 years — twice as long as most tank-style units — reducing replacement and repair expenses over time.
Space-Saving Design
Traditional water heaters can take up to 16 square feet of floor space. Tankless models, about the size of a carry-on suitcase, can be mounted on walls indoors or outdoors to free up valuable space.
Not sure which model is right for you? Use our Water Heater Finder to explore options tailored to your home.
Choosing the Right Tankless Water Heater
While tankless models heat water on demand, choosing the right one requires planning. Start by determining the proper size. A unit that’s too small won’t meet your household’s hot water needs, while one that’s too large can drive up costs unnecessarily. To choose correctly, understand your flow rate and temperature rise.
Flow Rate (GPM)
Flow rate measures how much hot water you need in gallons per minute (GPM). To estimate, count the appliances or fixtures you typically use at the same time, such as the shower, the kitchen sink and a washing machine. Then, add up their individual flow rates.
Find the GPM in the product manual or stamped on the appliance. You can also calculate it manually:
GPM = 60 ÷ seconds it takes to fill a 1-gallon container.
Example: Shower + kitchen sink + washer = 6.0 GPM at peak demand.
Average GPM Usage for Common Appliances and Fixtures
Based on the chart above, the total flow rate for peak usage while using the shower, the kitchen sink and a high-efficiency washing machine is 6.0 GPM.
Temperature Rise
Temperature rise is the difference between the incoming groundwater temperature and your desired hot water temperature.
Typical groundwater temperatures by region:
- Northern Zone: 37°F – 51°F
- Central Zone: 52°F – 61°F
- Southern Zone: 62°F – 77°F
To calculate the temperature rise:
Desired temp – incoming water temp = temperature rise
Example: 120°F – 57°F = 63°F rise
Budget Considerations
Tankless water heaters typically cost more up front than traditional models. A standard tank heater ranges from $500 to $1,000+, while tankless models that serve an entire home often start around $1,000. Despite the higher initial cost, they can save you money over time through reduced energy bills and maintenance.
Installation Costs vary depending according to:
- Whether your home is prepared for a tankless unit
- Any plumbing or electrical updates needed
- Installation labor rates in your area
Types of Tankless Water Heaters
Here are all the different varieties of tankless water heaters available.
Point-of-Use Tankless Water Heaters
Need an extra boost of hot water in a specific area? A compact, point-of-use tankless water heater is a great solution. These electric models can be installed easily in a cabinet or closet for added convenience and are ideal for:
- Rooms or appliances with a high hot water demand (ex., hot tubs)
- Home additions or remodels
Whole-Home Tankless Water Heaters
Designed to supply hot water for your entire household, whole-home models come in gas or electric.
- Gas Models: Range from 140,000 to 199,000 BTUs
- Electric Models: Available in 240V, ranging from 14 kW to 32 kW
Choose the right capacity based on household size and usage:
Maintaining Your Tankless Water Heater
While tankless water heaters are generally low maintenance, regular upkeep helps keep them efficient and safe.
Annual Maintenance Checklist:
- Clean the Filter: Keep debris out of the unit and prevents clogs.
- Monitor Water Pressure: Ensure it stays within the manufacturer’s recommended range.
- Inspect Ventilation (Gas Models Only): Check for blockages, damage or corrosion
Ready to Get Started?
Already decided on a tankless water heater, but don’t know which one is best for you? Head over to your local Lowe’s today and ask a Red Vest associate for help with choosing the right model for your home. We also offer professional installation options for most new units.