The best type of tankless water heater is a gas-powered model, offering high flow rates, energy efficiency, and lower operating costs compared to electric units.
Running out of hot water during a shower? Struggling with high energy bills from an outdated water heater? Choosing the wrong tankless model can lead to inefficiency, inconsistent temperatures, and costly installation mistakes.
The right tankless water heater can slash energy costs by up to 50% while delivering endless hot water. In this guide, we’ll cover the top-performing types, key installation factors, and maintenance tips. For expert advice on optimizing performance, check our detailed guides.
Key Takeaways
- Condensing gas heaters offer the highest efficiency (up to 98%) and lower operating costs.
- Electric models are cheaper upfront but may struggle in colder climates.
- Proper sizing depends on flow rate (GPM) and temperature rise needs.
- Recirculating pumps eliminate wait times for hot water.
Types of Tankless Water Heaters Compared
1. Condensing Gas Tankless Heaters
Condensing gas tankless heaters are most efficient and cost-effective. These units capture exhaust heat to preheat incoming water, achieving up to 98% efficiency. While pricier upfront ($1,000–$2,500), they save 30–50% on energy bills versus traditional tanks. Brands like Navien specialize in condensing tech with built-in recirculation.
2. Non-Condensing Gas Models
Non-condensing heaters (70–85% efficiency) vent hot exhaust gases outside, wasting energy. They’re cheaper ($500–$1,500) but require expensive stainless-steel venting. Ideal for warmer climates where groundwater rarely dips below 50°F.
3. Electric Tankless Heaters
Electric models ($400–$1,200) are compact and easy to install but demand high amperage (up to 160A). Best for point-of-use applications or homes with low simultaneous hot water demand. Struggles in cold regions—each 1°F drop in inlet temperature reduces output by 0.5 GPM.
Sizing Your Tankless Water Heater
| Household Size | Recommended Flow Rate (GPM) | BTU Requirement |
|---|---|---|
| 1–2 people | 6–8 GPM | 140,000 BTU |
| 3–4 people | 8–10 GPM | 190,000 BTU |
| 5+ people | 10+ GPM | 200,000+ BTU |
Calculate your needs: Add flow rates of all concurrent hot water devices (shower = 2 GPM, dishwasher = 1.5 GPM). Then subtract your groundwater temperature from 120°F (ideal output). Example: 60°F groundwater needs a 60°F rise.
Installation and Maintenance Tips
Gas models require professional installation for venting and gas line safety. Electric units need dedicated circuits—consult an electrician. Annual descaling prevents mineral buildup, especially in hard water areas. Install a water softener if hardness exceeds 7 grains per gallon.
FAQ Section
1. How long do tankless water heaters last?
With proper maintenance, 20+ years—double the lifespan of tank heaters.
2. Can I install a tankless heater myself?
Electric units are DIY-friendly if you have electrical expertise. Gas models require professional installation due to venting and gas line risks.
3. Do tankless heaters work during power outages?
Gas models with standing pilots will, but most modern units need electricity for ignition and controls.
Final Verdict
For most homes, a condensing gas tankless water heater delivers the best balance of efficiency and performance. Pair it with a recirculation pump (guide here) for instant hot water. While the upfront cost is higher, the long-term savings and reliability make it a top choice.
