To understand the concept behind tankless water heaters, it is first important to understand how a traditional tank-type water heater works. Once you understand it, it is not difficult to see how inefficient this process really is.

Traditional electric or gas tank water heaters ("conventional heaters") have been used in commercial and residential properties since the early twentieth century. Conventional electric heaters utilize a simple heating element to heat the water and a basic storage tank to hold the heater water until it is required. Conventional gas water heaters employ a similar system. With the exception of some fairly recent minor gains in the area of energy efficiency, they have remained virtually unchanged over the years. While the traditional process of heating is simple, it has some major drawbacks:

As water is demanded from a conventional tank, cold water begins to flow immediately into the tank. The cold water immediately starts to dilute the heat of the existing water in the tank, effectively reducing its capacity. As more and more water is drawn from the tank, the overall water temperature in the tank continues to drop, eventually becoming too cool to use comfortably for most applications (showering, etc.). Because of this inefficient process, if you have, for example, a 60-gallon tank, you actually only have only about 45 gallons of useable hot water. The other 15 gallons are lost as cold street water is added to the tank during the usage process. We have all experienced the icy blast when a traditional tank "runs out" of hot water.

Of course, once this occurs, we must also wait a considerable time for the heater to bring all of the water in the tank back up to a usable temperature. The speed at which this is accomplished is referred to as the "refresh" or "recharge" rate. To increase the refresh rate and reduce the effective of temperature declines during drawdown of the hot water, traditional water heaters are often set at very high temperatures - 130 to 140F. Basically, tank-type heaters require you to heat the stored water to an exceptionally high temperature in order to provide an adequate supply of hot water. This temperature is typically far higher than what would be comfortable or safe for showering or other household uses. You must first pay to heat this water only to cool it again by adding cold water to make it comfortable for use. In other words, you are paying for electricity which heats the water to a much higher temperature than you will ever actually use. Furthermore, you must pay to keep the water in the tank hot all day, not just for the few minutes of each day that it is actually needed. This results in a substantial amount of wasted energy - and wasted money too!

In addition, a conventional heater is consistently radiating heat (loss), which also contributes to the re-heating rate and energy consumption. This type of heat loss is often referred to as "stand-by" heat loss. Even today's highly-insulated "energy efficient" tanks have a considerable standby heat loss. Most conventional heaters have upper and lower heating elements, one of which is cycling on or off 24 hours per day, even when you're not at home. Using a tank to continually heat and store water is akin to parking your car in your driveway and leaving it running all night at idle until its next use. Simply by eliminating stand-by heat loss alone, energy consumption can be reduced by 20% to 30%.

Furthermore, conventional heaters require a substantial amount of space. Generally located in closets, utility rooms or garages, they consume valuable square footage that could be put to better use.

• Reduce water heating costs as much as 60%
  
   
• Will not leak or rupture
  
   
• Prevents scalding injuries
  
   
• Hot Water Never runs out.
  
   
• Heats only the water you use, to the temperature you desire
  
   
• Cold water is not required to regulate temperature
  
   
• Maintains efficiency throughout its lifespan
  
   
• Long warranties
  
   
• Long service life
  
   
• Not prone to hard water or mineral problems
  
   
• Hot water, forever!

Tankless water heaters heat water entirely on demand, only when it is needed. Then a hot water faucet is turned on and the water begins to flow, a sensor detects that hot water is being demanded. This sensor effectively turns on the heating elements/heat exchanger and a computer chip selects the correct power output to the elements/heat exchanger based on the heat setting selected by the user, the flow rate, and other parameters. The water flows across the internal heating elements or heat exchanger and exits the unit at the desired temperature. The start-up process takes a couple of seconds. The tankless water heater will remain on until the hot water faucet is closed. As soon as the flow sensor detects that water has stopped flowing, the power to the unit is turned off completely. So when hot water is not being demanded, absolutely no energy is being consumed. The stand-by heating loss is completely eliminated.

Furthermore, since a tankless water heater has no refresh rate (it is instantaneous), there is no need to overheat the water to 130 or 140F (or higher) as with a conventional tank. You can select an output temperature that matches your actually needs (usually about 105F). This also saves considerable energy.

Being about the size of a yellow pages phone book, considerable space savings are also achieved. As a result, tankless water heaters can often be installed closer to the point-of-use, delivering hot water to the faucet faster. The extra space can be employed for storage, etc.

Another noteworthy problem with traditional water heaters is their susceptibility to minerals, sediments, and age. The average lifespan of a traditional tank-type water heater in North America is less than 12 years. Unfortunately, most tanks, once they have reached the end of this short service life, are destined for the landfill - hardly an environmentally-friendly or long-term cost-effective solution. Tankless water heaters, on the other land, have far longer service lives. Electric tankless water heaters typically last 30 to 40 years.
 

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