July 5, 2022

Tankless water heaters are often called instant or on-demand water heaters as they provide hot water only when it’s needed. They can be electric or gas-fueled. They heat water without holding water in a storage tank. Tankless water heaters give a home a constant supply of hot water. How do you keep tankless water heaters efficient? There are ways to extend the system’s life and get more bang for your utility bills, so you’ll get the most benefit from a tankless water heater.

Are Tankless Water Heaters Energy Efficient?

Yes, but to understand exactly what you should be getting, then what you should be paying, first check out exactly how energy efficiency is calculated for a water heater. Energy efficiency in water heaters is measured in EF, or energy factor. The EF gives the water heater’s overall energy usage. This is established by the quantity of hot water generated per unit of electricity or gas used in a day. This measurement is based on these variables:

Recovery – How efficiently the heat from the power source (gas or electric) heats water.

Standby Loss – This only relates to tank water heaters since this measures water stored in a tank and the heat loss while it’s in the tank.

Cycling Loss – This is the heat loss as water flows through the tank and pipes.

Really just one of these relates to tankless water heater performance because there is no recovery or standby loss. Cycling loss applies only to systems that don’t maintain the heat cycling throughout the unit.

Energy Efficiency Numbers

Standard water heaters have an EF, or energy factor, of about .60. This simply tells us about 60% of the energy entering the system is used to heat the water. About 40% of the heat is lost in the process. That heat goes out through the air vent. Tankless water heaters have a EF ranging from .80-.99. You will greatly reduce your heat loss when you convert to tankless, and use less energy to heat the same quantity of water.

Getting Rid of Standby Losses

Traditional water heaters lose a high percentage of heat when they have water stored in the tank on standby. The system must reheat the water. This uses more energy. Tankless heating units only heat the water when needed, thus saving energy prices when no one is using hot water. Contacting a tankless water heater expert such as South End Plumbing will guarantee you get the best, most efficient tankless water heater for your home and family’s needs.

Helping a Tankless Water Heater Stay Efficient

According to U.S. Department of Energy, tankless water heaters are 24-34% more energy efficient than tanked water heaters for homes which use 42 gallons or less of hot water a day. The efficiency savings is 8-14% for homes using 42-86 gallons of hot water a day.

It’s shown installing a hot water heater at each hot water outlet takes energy efficiency savings to 27-50%. Installing more than one tankless water heater might be recommended while installing one for every single fixture or outlet might be a bit impractical.

Although the upfront expense of a tankless water heater and installation is more than a tank water heater, they typically last longer and have lower power costs. Many on-demand water heaters have a lifespan of about 20 years and have exchangeable parts that can prolong their life expectancy.

More Tips for Energy Efficiency

Whether you have a gas or electrical water heater, there are basic practices and simple upkeep you can use to reduce power bills and have your water heater run more efficiently.

Drop the Thermostat

You can, and maybe even need to, lower the temperature of your hot water. Lowering the heat on the water heater, tanked or tankless, can be a major help to an energy bill.

The normal preset for a water heater is 130-140 degrees. This is too hot for human skin, and may certainly be too hot for young children. You should lower the temperature to 120 degrees. Dropping the temperature 10 degrees will save 3-5% on water heating cost.

If the thermostat is faulty, difficult to read or you do not wish to operate it, call a technician who can help.

Have the Correct Sized Water Heater

Tankless Water Heaters Energy Efficient
Tankless heating units only heat the water when needed, thus saving energy prices when no one is using hot water.

Is the water heater the right size for your house and usual water usage? You may think a smaller unit will use less energy. This is probably wrong. An undersized water heater must work more. The answer may be a larger water heater or multiple tankless water heaters at the right points throughout the house. The right answer isn’t just about the square footage of the home or number of bathrooms. Those factors are part of the mix, but your family’s water usage, normal day, number of other appliances and more goes into the answer, too.

Sediment, Minerals in Your Water

If you live in a location with hard water, you know minerals in water may impact the performance of your water heater. As water is heated, these minerals crystallize and settle to the bottom of a water heater tank or in the pipes running out of the unit. This buildup or mineral deposits will drop the efficiency of the heater and plumbing over time. Flushing and draining a water heater tank one or two times a year will help keep it clean. This maintenance will keep it sediment and deposit free. It’s important to keep it running for years.

Usage Less Hot Water

You can save money on your water and energy bills by using a little less water each day. If it’s with showers, using cold water on laundry loads or using energy-saving settings on appliances, you can use less hot water.


South End Water Filtration specializes in HALO Water Filter products including the HALO H2 Zero Whole Home Water Filter. HALO systems solve hard water problems, give your family clear, great-tasting water and are totally maintenance free. We’re just a click away to help and answer any questions. South End Plumbing and South End Water Filtration will give you a free estimate. Call us at 704-486-1988 or contact us online to schedule a visit.