Natural Gas Tankless Water Heaters

​Hot Water On Demand

For endless hot water whenever it’s needed, consider the advantages of installing a tankless water heater.

How does it work?

To understand the differences between traditional storage water heaters and tankless water heaters, let’s start with how both units heat water.

Storage water heaters

Storage water heaters take cold water from a home’s water supply and move it to the bottom of a storage tank where it is heated by a gas burner controlled by a thermostat. Since hot water is lighter than cold water, the heated water rises to the top of the tank where a delivery pipe takes it to where it is needed. When hot water leaves the tank, the burner automatically comes on again to heat the new water.

Tankless water heaters

Tankless water heaters provide hot water on demand without the use of a storage tank. A tankless water heater has a gas burner that is activated by the flow of water whenever a hot water faucet is turned on. The water heater will deliver a constant supply of hot water until the faucet is turned off.

Save energy and lower operating costs

With a conventional water heater, even if no hot water is drawn from the tank, the unit operates throughout the day to maintain the water temperature setting on the tank. The need to periodically reheat the water is due to “standby losses” caused by heat being conducted and radiated from the walls of the tank. You pay for the energy to keep the water hot whether you actually need it or not. Standby losses can represent 10 to 20 percent of a household’s annual water heating costs.

A tankless water heater heats water for only as long as it is being used. Because there’s no need to store water, there’s no standby heat loss, resulting in lower operating cost. Tankless water heaters also use a burner lit by electronic ignition, so there’s no standing pilot light.

The best indicator of a heater’s efficiency is its Energy Factor (EF). Energy Factor is a measure of the overall efficiency of a water heater determined by comparing the energy supplied in heated water to the total daily consumption of the water heater (Source – GAMA Directory).

In terms of energy efficiency, tankless water heaters have a rating from 80 to over 90 percent. Conventional gas storage tank heaters typically have EF ratings between 54 and 63 percent. The higher the EF, the more efficient the water heater. Unlike storage tank heaters, which can have declining efficiencies due to mineral build-up, tankless water heaters retain more of their original efficiency rating over the life of the heater. Remember to check the EnergyGuide label for an estimated of the heater’s annual operating costs.

Tankless water heaters are compact, about the size of a medium suitcase, so they can free up valuable floor space in a home or apartment. These water heaters can be installed easily indoors in locations such as a storage closet or utility room wall, or they can be mounted outdoors. Large units used for whole house water heating are typically installed in a central location.

Convenient and built to last

Tankless water heaters are light and most have parts that are easy to replace. Plus, there’s no tank to collect mineral build-up, helping to prevent costly leaks. These factors contribute to life expectancies for tankless water heaters that are nearly double that of storage tank water heaters.


Unlike typical tank water heaters, tankless models can be installed indoors or outdoors. Units installed outdoors can be mounted directly to walls or recessed between wall studs to blend into the home or building structure. Tankless water heaters installed outdoors do not require additional venting.

A tankless water heater installed indoors must be vented to remove the byproducts of combustion. Atmospherically venting gas water heaters is the most common type of venting option used. Since flue gases from the water heater are warmer than the surrounding air, they will rise naturally through a vertical vent pipe or chimney to the outdoors. Installation and operating costs tend to be less for atmosphericallly vented water heaters because these units do not use fans or other mechanical boosters.

Direct vent or horizontally vented water heaters are designed for installation where vertical chimneys or flutes are not available or would be more expensive to install. The vents go directly through an outside wall and can also bring in combustion air to the gas burner. Most of these units require zero clearance at the sides and rear, allowing them to be installed in a small area. Power-vented natural gas water heaters use an electric fan or blower to push or pull combustion gases to the outdoors. This type of venting allows gas water heaters to be installed as far as 40 feet away from an outside wall and in home and apartments without existing vertical vents.

Where do I go for more information?