Why is an Electric Tankless Water Heater so economical?

There are two primary ways that a tankless water heater reduces energy bills:

1. A conventional tank-type water heater must keep 40-60 gallons of water heated to between 120o-160o F. 24 hours a day, 7 days a week, 365 days a year. Now compare that to how many minutes a day you actually turn on a hot water tap, shower, clothes or dishwasher, etc. A tankless water heater only consumes electricity when you use hot water! It completely eliminates the thermal heat losses from the storage tank of a traditional hot water heater that happens constantly throughout the day. This alone can reduce your power consumption related to your water heating by 20-30%.

2. To ensure that a conventional water heater recovers quickly after a major use like a shower and to prevent problems associated with cold water mixing in the tank during drawdown, traditional tank water heaters are typically set at very high temperatures, much hotter than you normally use the water. The first thing you do when you go to have a shower is mix in cold water. This process of overheating water only to cool it again is inefficient. With a tankless water heater, a more reasonable output temperature of 105 to 110F can be selected since the water is heated on demand. According to the US. Department of Energy, for each 10ºF reduction in water temperature, you can save between 3%–5% in energy costs.