Storage Tank Water Heater (Conventional Water Heater) vs Tankless Water Heater

plumbers installing a water heater
Plumbers installing a water heater in a home

When your water heater has aged and died and it’s time to replace your water heater, there are two popular options. You can purchase a new tankless water heater or a water heater with a tank reservoir (traditional water heater type).

So, which type do you choose? What is the best water heater for you and your needs?

When time comes, it’s worth looking at a tankless water heater versus a traditional storage water heater. Each one comes with its pros and cons, so keep reading to learn about which water heater is best for you.

What Is a Tankless Water Heater?

A tankless home water heater is also known as an instantaneous or demand-type water heater. It will provide you with hot water as you need it instead of storing it in a tank.

When you turn your hot water faucet on, cold water will flow through a heat exchanger in the tankless water heater. Either an electric element or a gas burner will heat the water as it flows through the exchanger.

Thus, with a tankless water heater, you never run out of hot water for as long as you purchase to correct size. Whereas with a storage tank type water heater, you must wait for the water to be reheated once you’ve depleted the stored hot water.

Tankless water heaters provide hot water at a rate of 2 to 5 gallons of water a minute. Electric tankless water heaters will produce a slower flow than a gas-fired tankless water heater. If you have a home that requires simultaneous needs for hot water, or large hot water demand, it is recommended to select a gas-fired tankless water heater.

For example, if you plan on taking a shower while you’re running the dishwasher, you can max out your tankless water heater’s ability to meet the demand.  In such case, where a larger demand for hot water is required you should consider installing two tankless heaters.

When properly calculated for hot water demand and, professionally installed, tankless water heaters may present lots of advantages.

What Is a Storage Tank Water Heater?

A storage tank water heater is typically what people think of when they think of a water heater. This conventional water heater will have a tank that stores the hot water. Most tank type water heaters are powered by 230V electric while some use LP Gas or Natural Gas.  Regardless of the energy source, the concept is the same, a water reservoir is heated to a set temperature and is on standby for demand.

Storage Tank Hot Water Heater

The typical storage tank water heater has a reservoir “tank” which holds 20 to 80 gallons of water. The tank which is insulated, is filled with tap water and heated. Upon demand, hot water in the tank is replaced with new tap water and the heating cycle begins again.  The heating cycle may also be triggered by the drop in water departure due to ambient heat loss (poor insulation or lack of).

How to Choose a Water Heater

Not all water heaters are the same. When you’re searching for a water heater, you need to consider these important factors:

  • Your budget
  • Your power source.  Do you have Electric, Natural Gas or LP Gas.
  • Your demand for hot water at any given time.  Always calculate for peak demand.
  • Space.  Note: Tankless water heaters can be installed both indoor and outdoor while tank type are installed indoors.
  • Quality of your tap water (water filtration is strongly recommended)

Have a qualified plumber visit your home and provide you with demand analysis, options and cost estimate.  But, before you hire just any plumber, you should verify their credentials and qualification:

  • Ask for the plumber for a copy of license and insurance
  • Ask for references
  • Ask for a cost estimate in writing including warranty on workmanship
  • Check with the local Better Business Bureau
  • Demand that the job be permitted and inspected by the local building department
  • Ask if the company provides startup and follow-up

Learn about the brand and model in which is considered so you understand how to maintain it. Build-up and corrosion will shorten the life of a tankless water heater (the heat exchanger) and can void warranty,


Pros of Tankless Water Heater

Tankless water heaters are popular and for a reason.  There are many advantages of replacing your old tank type water heater with a new tankless water heater. Below will look at the biggest advantages of a tankless water heater.

Energy Savings

If your home uses 41 gallons or less of hot water every day, then a tankless water heater makes sense for you. Experts estimate that a tankless water heater can be between 24 and 34 percent more energy efficient than a tank type water heater if you less than 40 gallons per day.

So, the biggest advantage of a tankless water heater, if you have a small household, is energy savings. For a greater savings consider installing a tankless heater at each hot water outlet.


Tankless water heaters also last longer than tank heaters if properly installed and cared for. If you care for your tankless heater, you can hope for it to last up to 20 years, whereas a tank heater will last between 6 and 13 years.

Less Wasted Energy

Storage water heaters tend to waste energy as they’re constantly working to keep water in the tank hot. A tankless water heater, on the other hand, avoids the heat losses that you have with a storage water heater. They only heat water as you need it and thus save energy overall.

Cons of Tankless Water Heater

Tankless water heaters may heat water efficiently, but they still have a couple of detractors. Here are the cons of a tankless water heater.

Initial Installation Cost

On the downside, a tankless water heater will cost you more in the beginning. Installation costs alone are significantly more for a tankless water heater than a tank type conventional water heater.

Pros of Storage Water Heater

A storage water heater produces hot water differently than a tankless heater. Thus it has different pros and cons.

Cheaper Installation Costs

For example, while the cost of a storage heater itself costs more than the cost of a tankless water heater, the installation costs for a storage water heater are less than the installation costs of a tankless water heater.

As noted previously, installation costs are significantly less for a tank heater because the installation is much simpler. A plumber just needs to hook the heater up to the water and the electrical wiring. A tankless heater requires a more detailed installation and thus costs more.

Simpler Maintenance

A tankless water heater requires the homeowner to descale it regularly. Tank water heaters, in comparison, require little maintenance. The newest models also have a maintenance panel on the water heater’s side, creating easy access.

Simplest Replacement

Most homes are set up with a tank water heater. They have the electrical supply that will seamlessly allow the tank water heater to be replaced. Not all homes, however, have the gas supply you’d need for a tankless water heater.

Cons of Storage Water Heater

While you can replace your water heater simply with a tank water heater and hope for less maintenance, there are still a few downsides.

Wasted Energy

On the downside, tank water heaters compared to a tankless water heaters will use more energy. Although tank water heaters are insulated to maintain heat, some heat loss is common. In addition, when hot water is drawn from the tank it is replaced with tap water which reduces the average water temperature in the tank hence requiring the heating cycle to begin.

Heat Loss

You will ultimately lose more heat when you use a storage-tank water heater. The tank stores hot water for a longer period of time compared to a tankless water heater. The instant water heater or tankless water heater only produces hot water when you need it.

Tankless Over Tanked

In the end, a tankless water heater has more pros than a storage-tank type water heater. The water heater cost is lower over the duration that you own the new tankless water heater. Also, you save energy monthly when installing a water heater that is tankless.

Because of the growing popularity of tankless water heaters, you can find both tankless and tank water heaters (conventional water heaters)  easily at your local hardware store such as a Home Depot or Lowes.

Are you looking for a water heater repair or new water heater replacement? If so, contact us. We would love to help you have hot water once again.

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