Do demand-type water heaters actually save energy?

Every Fresno homeowner wants to save money on their home’s utility bills. The challenge is often knowing where to start, and what upgrades will actually help you save. Our team often gets questions about tankless water heaters—also known as demand-type water heaters or instant water heaters—and whether or not they actually help homeowners save money. In most cases, they can!

In this article, we’ll review demand-type water heater efficiency and why you should consider upgrading to a more efficient water heater. For all your water heater repair, service, and replacement needs here in Fresno, be sure to call our team.

A demand-type water heater can provide your home with limitless hot water.What are demand-type water heaters?

These systems are known by several names: demand-type water heaters, tankless water heaters, instantaneous water heaters, or electric demand water heaters. No matter what they are called, these systems all generally work the same: the water heater runs water past several internal heating elements, rapidly raising the temperature of the water “on demand.”

Demand-type water heaters are different from standard, “tank” water heaters in several key ways:

  • They do not store heated water in a storage tank and instead heat it as it’s needed in the home. This reduces their overall physical footprint. In fact, most demand-type systems are wall-mounted.
  • Unlike a standard water heater, they cannot “run out” of hot water, since they are heating hot water as needed and not storing it ahead of time.
  • With no tank, there is no risk of the water heater leaking or bursting near the end of its life.

An energy-efficient source of hot water for your home

According to data collected by the U.S. Department of Energy (USDOE), heating water is the second largest utility expense in the average American home, representing about 14-18% of your annual energy costs. In real dollars-and-cents terms, this is about $400-$600 every year.

A demand-type water heater is anywhere between 8-34% more energy efficient than a standard one. On average, homeowners who upgrade to a tankless system save about $100 per-year. For large homes and families with an even higher rate of daily hot water use, those savings can be even more.

How is this possible? Unlike a regular water heater, a demand-type system doesn’t store hot water. As hot water sits in the tank of a hot water heater waiting to be used, heat energy is being lost through the walls of the tank, and the heating element needs to constantly be keeping it warm enough for when it’s called upon at the faucet, shower head, or dishwasher. This wastes energy, especially if the tank walls are not sufficiently insulated against heat loss. Demand-type systems avoid this altogether by heating the water as it is needed, avoiding the need for standby heating and reheating.

Is a demand-type water heater right for your home?

While they are more energy-efficient and convenient, demand-type water heaters do often cost more upfront than standard water heaters. Here are some things to consider if you’re weighing the decision to upgrade:

  • Longevity: While they do cost more to initially install, most tankless water heaters can last anywhere from 2 to 2.5 times as long as a standard water heater. This alone may offset their higher upfront cost, especially if you and your family are planning on staying in your home for the foreseeable future.
  • Energy Source: There are many different types of demand-type water heaters. Some use natural gas or propane to heat the water, while others use electricity. Generally, gas tankless water heaters with an intermittent ignition device are going to be the most efficient for your home.
  • Rebates: USDOE notes that there may be state, local, and utility company rebates available to help offset some of the costs associated with installing high-efficiency water heaters. For more on this, be sure to call our team to review your options.

Getting the right system for your home

USDOE recommends hiring an experienced plumbing contractor to handle the installation of your demand-type water heater. At Allbritten, our experienced plumbing team can help you find the right water heater for your home and water heating needs. We carry a wide variety of energy-efficient tankless and standard water heaters.

Beyond that, as BPI-certified energy audit and home energy upgrade specialists, Allbritten can help you find even more ways to save on your water heating energy costs. Some of our common recommendations for local homeowners include:

  • Lowering the temperature of the water heater to 120 degrees.
  • Upgrading to an efficient, water-conserving dishwasher and washer.
  • Installing low-flow shower heads, faucets, and other fixtures.

For the very best in local home services and energy-efficiency expertise, contact Allbritten.