An on demand system is generally considered more energy efficient than a storage system, but this opinion really seems to vary from source to source when you look into statistics. Most Americans are accustomed to a storage type system and they know what to expect of them I.E. a limited amount of water at a set temperature. Although a tank type water heater is thermostatically controlled, recovery rate is typically much slower than the draw rate when showering, drawing a bath or loading a clothes washer. This slower recovery requires a conscious use of hot water or you may be left cold and wet, literally.
With tankless water heating the experience is quite the opposite. As long as the fuel supply remains adequate, tankless heaters will continually produce hot water for an unlimited period of time. Where we find limitation with tankless heaters is the flow rate. The volume/flow rate of tankless heaters is determined by the temperature rise required to meet the per-established temperature and by the maximum Btu rating of the appliance. Tankless gas water heaters operate on a modulating gas valve which varies the amount of fuel based on the demand. Demand is determined by the amount of water being called for and the temperature rise needed to provide the proper flow rate at the set temperature. If you turn on 1 bathroom sink faucet at 1.0 gallon per minute (gpm) the heater will fire at minimum Btu capacity. If more than one fixture is on or if a fixture with a higher gpm flow rate is turned on the heater increases the input amount of fuel to supply and fires additional burners to meet the demand. With flow rate limitations in mind it is important to properly size the system prior to installation.
A common misunderstanding with Tankless water heaters, also known as instantaneous heaters, is that the hot water will be immediately available at the point of use. The term instantaneous when referencing a tankless heater is greatly misleading. The term refers to the rapid firing and heating process. With most tankless brands burner ignition happens as soon as the minimum water flow is detected; that’s as close to instantaneous as tankless heaters get. The water doesn’t get to the point of use any sooner than with a traditional heater, unless additional design changes are implemented at the time of installation. This realization can be a great disappointment to a homeowner. If you are interested in having hot water readily available at any giving point of use, consider adding an On Demand Circulating Pump to your hot water system. These provide various methods of activating a circulation pump that brings the heated water to the faucet without having to turn on the faucet. Installing a circulation pump of this kind will save a lot of water in that you don’t let a faucet run until hot water arrives.
Whether or not tankless water heating systems conserve fuel and/or water is determined by the one thing everybody can control, without any expense. Personal habits become the deciding factor. Studies have shown that homes with on demand heaters are less concerned with the amount of hot water they use. Because these heaters provide a continual flow of hot water, people tend to take longer showers, fill the tub more, use hot water for clothes washing etc, etc. In this situation the water and fuel consumptions can be greater than when we have limitations of a tank type water heater.
On demand water heaters are likely to become the standard. The industry is moving toward phasing out the traditional water heater. This makes sense as long as we encourage behavioral change as well. Conservation begins with awareness.