How Does a Tankless Water Heater Work

Tankless hot water heaters provide hot water on demand rather than heating and storing it for later use. With a tankless system, you can enjoy nearly endless hot water because it doesn't rely on a stored supply. A tankless water heater operates efficiently, saving families money on energy and water bills. If you want to upgrade your water heater system, continue reading to learn how tankless water heaters work.

Types of Water Heaters

Water heaters provide the hot water necessary for various purposes and appliances such as dishwashers and hot showers. Families can choose between various water heater types:

Conventional Storage

A conventional storage tank water heater is a common type of water heater. It features an insulated water tank that heats and holds hot water until a household uses it. The tank's capacity determines how much water a household has available at one time. Once the tank's available water is used, they must wait until the tank fills again to use hot water.

Heat Pump

A heat pump water heater, also known as a hybrid water heater, uses heat in the ground and air to heat water instead of electricity.


Solar-powered water heaters are energy-efficient systems that operate on energy from sunlight. They draw energy from solar panels on a home's roof and transfer it to a closed-loop system that heats water using a heat-conductive material.


A condensing water heater heats water using a home's unused gas fumes. It funnels heated exhaust from the home's natural gas system through a coil on the bottom of the water tank. This heats the water using little energy since the gas is already used for other purposes within the home before it heats the water.


Tankless water heaters use heated coils instead of tanks to provide homes with hot water. A tankless water heater uses modern technology to provide households with almost endless hot water. Tankless water heaters are not limited by a certain capacity because their heated coils heat water on demand. Tankless water heaters are excellent for families who want to save water and energy while having access to hot water when they need it.

How Are Tankless Hot Water Heaters Unique?

Tankless water heaters heat water while it flows through pipes instead of storing hot water for later use. Because of this, tankless water heaters use less energy than traditional hot water heaters. This families money on their energy bills.

How Does a Tankless Water Heater Work?

A tankless heater can provide water on demand because it heats water when you need it. When you turn on a faucet or the shower, the tankless system detects water movement in the hot water lines and activates the heat exchanger to apply heat. Tankless systems are not instantaneous water heaters, but they do heat water quickly. The system heats water within 15 seconds, sends the hot water to the faucet you're using and continues to heat water as long as you use it.

How Does a Tankless Hot Water Heater Ignitor Work?

In a tankless water heater, a heat exchanger heats water as cold water flows through it. Internal sensors detect water flow and ignite the gas burner or activate the system's electrical element. The gas or electric element heats the water as it flows through the heat exchanger, and the heat source turns off when you turn the tap or appliance off.

How Do Tankless Water Heaters Measure Water and Regulate Temperature?

Tankless hot water heaters measure water flow in gallons per minute (GPM), which quantifies the hot water steady flow rate a heater can produce. Homeowners can add the GPMs they plan to use for their appliances and fixtures at the same time to determine their home's necessary flow rate.

The colder your home's incoming ground water temperature is, the higher your tankless water heater will need to raise its temperature to provide comfortable hot water. To determine what temperature your system will need to heat your water, you must consider your region's average groundwater temperature.

First, determine your area's coldest possible groundwater temperature. You can then subtract the expected groundwater temperature from your desired hot water temperature to determine your water heater's ideal heating temperature. Most households need their systems to heat their water to about 100 to 115 degrees Fahrenheit.

Types of Tankless Hot Water Heaters

Tankless water heaters have various flow rates, maintenance and energy costs and energy savings based on their fuel type. Homeowners can also choose between three different types of tankless water heaters — condensing, non-condensing and hybrid.

How Does a Natural Gas Tankless Hot Water Heater Work?

Tankless gas water heaters operate on natural gas. They typically produce more hot water than electric tankless heaters, making them an excellent choice for larger families that use large amounts of water. Installing a gas-powered tankless water heater may be more complex and have a higher cost than installing an electric tankless water heater because most homes need a plumbing reconfiguration to accommodate a tankless gas water heater.

How Does an Electric Tankless Hot Water Heater Work?

Electric tankless water heaters operate on electricity, and they are typically easy to install. They are also easy to maintain, but most of them can only power one outlet at a time. Electric tankless heaters are not as energy-efficient as gas-powered tankless heaters, but they are a good option for families that don't use natural gas.

How Does a Condensing Tankless Water Heater Work?

Condensing tankless water heaters heat water using multiple heat exchangers. The heat exchangers trap the exhaust that the first heat exchanger produces, making a condensing tankless heater more energy-efficient than a non-condensing tankless heater.

How Does a Non-Condensing Tankless Water Heater Work?

A non-condensing tankless water heater uses one heat exchanger to heat water. It produces a hot exhaust that must be released outdoors, requiring a vent that directs it outside the house. Due to the necessary vent, non-condensing tankless heaters typically cost a little more than condensing tankless water heaters.

How Does a Hybrid Tankless Water Heater Work?

Hybrid tankless water heaters contain a small tank and heat water by pulling heat in from the air outside the tank. Hybrid models are typically more efficient than condensing and non-condensing tankless water heaters because they use less energy, but they have a slightly higher cost. A hybrid system can only function when its tank is surrounded by open air, so homeowners may need to expand their storage space when they install a hybrid model.

Do Tankless Hot Water Heaters Run Out of Hot Water?

A tankless water heater can become overwhelmed under certain circumstances. You can count on having a continuous flow of hot water for a long, relaxing shower, but using hot water in multiple faucets at one time may be too much for some systems. Choosing the right size water heater for your

Can a Tankless Water Heater Provide an Endless Supply of Hot Water?

A tankless water heater will not run out of water, but a high demand can overwhelm it. Using hot water in a single appliance or the shower will not overwhelm the system. However, using it in multiple taps at the same time can deplete the system's power. When a tankless heater becomes overwhelmed, it may take slightly longer to heat the water initially. You can avoid overwhelming your tankless water heater by calculating your maximum hot water demand.

You can calculate the GPM of hot water your household typically uses during peak times to help you purchase the right size tankless system. Installing two or more tankless systems can also prevent system overwhelm for families who expect to frequently use hot water for multiple purposes at the same time.

How Many Showers Can a Tankless Hot Water Heater Support?

A tankless water heater can provide hot water at a flow rate equal to or below the system's maximum flow rate. If a household has a water heater with a 4 GPM flow rate, the heater can supply hot water for a shower and one appliance at the same time. A heater with an 8 GPM flow rate can typically support up to two showers and one appliance simultaneously.

It's also important to consider a system's British thermal unit (BTU), which measures how much energy a tankless water heater requires to raise water temperature by one degree Fahrenheit. A heater with a high BTU can supply hot water for more bathrooms and appliances than a heater with a lower BTU.

Larger families that expect to use multiple showers at once may not benefit from a tankless water heater as much as smaller families. Calculating your home's GPM and a tank's BTU can help you determine if a tankless water heater is right for you.

How to Maintain a Tankless Hot Water Heater

Tankless water heaters require less maintenance and replacement parts than conventional water heaters. However, you should still take measures to maintain a tankless water heater and prolong its life span. To care for your tankless water heater, you must complete the following tasks:

  • Clean the water line filter: Most tankless water heaters contain a water line filter that protects the system from sediment, scale and hard water. These contaminants can damage the system if they build up, so it's important to clean or replace your water filter according to your heater's user manual.
  • Clean the air filter: If you have a natural gas tankless water heater, it may contain a filter between its fan and the air intake pipe. Insects, dirt and debris can clog this filter over time, disrupting the heater's airflow. Clean the air filter regularly to prevent clogging.
  • Descale and flush the system: Calcium and lime deposits can accumulate in a tankless water heater system over time. Descaling and flushing your system once a year can remove harmful deposits from your system.

Cleaning a system's water line filter and the air filter is a simple process, but you may need to schedule professional maintenance for descaling and flushing the system if unfamiliar with the process. It's also important to schedule annual maintenance for your tankless water or service it twice per year if you have hard water.

Tankless Hot Water Heating Troubleshooting

While tankless water heaters require less maintenance than traditional water heaters, they can still require some troubleshooting on occasion. Consider some helpful troubleshooting tips for the following situations:

Low Hot Water or System Shut-Down

Your tankless water heater may struggle to provide hot water or shut down completely if your household overloads it. If this occurs, limit simultaneous applications to decrease your demand for hot water and reset your system. If this occurs frequently, consider purchasing a second tankless water heater or upgrading your current system.

Random Cold Water

You may experience a random period of cold water that lasts several seconds if you use hot water shortly after another person or appliance in the home uses hot water. This is because a tankless hot water heater will release any hot water trapped in the pipes before heating new hot water.

If you start a shower with hot water that turns cold for a short time, you are receiving the water that was trapped in the pipes. This does not indicate any issues or needs for repairs, so you can wait for the cold water to pass before entering the shower or using an appliance.

Blocked Air Supply or Exhaust

If your tankless water heater displays an error code regarding your system's air supply or exhaust, there may be a complication with its combustion air or venting. If this occurs, check your heater's vent pipes for any holes or connection gaps. You should also check your heater's manual to make sure your system meets clearance requirements. A tankless water heater needs adequate space for proper venting, so it's important to check for any objects or animal nests that may be blocking your system's air supply.

Ignition or Flame Failure

A tankless water heater may fail to ignite if there is an issue with the gas supply. You may need to fill your propane tank, but you can also check your water valve and gas valves if your propane tank is already full. Each valve should be fully open. If these solutions don't work, you may need to call a technician to repair your ignition pack or address larger complications.

Filling your propane tank and checking your valves can also resolve a flame failure. However, you may need to call a technician to install a larger gas line or address complications such as venting, combustion or regulator issues.

Who Should Get a Tankless Hot Water Heater?

Tankless water heaters are an excellent option for many households. You can benefit from a tankless water heater if you want to use less energy and water while maintaining your comfort. You should consider upgrading to a tankless water heater if your home can support a tankless heater's electrical needs and your household uses a low to moderate amount of hot water at a time.

Upgrade Your Hot Water Heater With Ingram's Water & Air

A tankless water heater can help you conserve energy and water while enjoying a nearly endless supply of hot water. With a tankless system, you can run the dishwasher and enjoy a hot shower afterward without waiting for a hot water supply to replenish. Ingram's Water & Air offers quality tankless water heaters to help families save money on their energy bills and enjoy an on-demand water supply. Browse our selection of tankless water heaters to find the right match for your home.

0 comments (view/add)

* All fields required.

Your email address will not be published. Comments will display after being approved by our moderators. Comments may be edited for clarity.

Related articles from our experts

  • Guide to Tankless Water Heater Installation

    Guide to Tankless Water Heater Installation

    Tankless water heaters are excellent investments that increase comfort and energy savings. With a tankless water heater, you can enjoy an endless hot water supply and consume energy only when you need hot water.

    A tankless water heater installation costs slightly more than installing a conventional water heater, but the savings and convenience are worth the price. Learn more about tankless water heaters and their installation process.

    What Are the Benefits of Tankless Water Heaters?

    Tankless water heaters are different from other types of water heaters because they lack the tank that conventional heaters use to store hot water. Rather than storing hot water in a holding tank, tankless water heaters heat water as needed.

    As water flows through a tankless system, it passes through heated coils that warm it on its way to a faucet. Because they are so different from conventional systems, tankless water heaters offer the following benefits:

    Energy Savings

    Tankless water heaters save energy because they only heat water when a household needs it. Conventional water heaters use energy continuously to keep their stored hot water warm until homes use it. Maintaining a consistent hot temperature within the tank uses a significant amount of energy.

    A tankless water heater's lack of water storage eliminates its need for a constant energy source. Rather than using energy all day and night, tankless water heaters only use energy while they are heating and delivering water to a faucet. This can result in incredible energy savings.

    Households that consume 41 or fewer hot water gallons per day can save approximately 24%-34% more energy with a tankless water heater.

    Space Savings

    You can also save a significant amount of space in your home with a tankless water heater. Tankless heaters are much smaller than conventional water heaters because they lack a storage tank. Storage tanks are typically 5 feet tall and 2 feet wide, taking up valuable space in your home. An average tankless water heater is about 18 inches tall, 18 inches wide and 4 inches deep, allowing more space for other things that matter to you.

    Water Capacity

    Tankless water heaters provide the amount of hot water your home needs as you need it. Whether you and your loved ones enjoy long, comfortable showers or need a lot of hot water for multiple laundry loads each day, a tankless heater consistently delivers water at the right temperature whenever you need it.

    Tankless water heaters also deliver fresh water. A conventional heater's tank holds water until you need it, allowing it to become stale in the meantime. A tankless water heater heats water on demand, sending new water through the pipes.


    Tankless water heaters last much longer than conventional water heaters. While a conventional water heater typically lasts eight to 12 years, tankless water heaters can last up to 25 years. Though a tankless water heater costs more upfront, its longevity saves you money in the long run.

    Eliminated Risk of Water Leaks

    Water heater tanks can hold 50 gallons or more, which can create some serious damage if a leak occurs. Tankless water heaters eliminate the risk of leaks because they lack a tank. The most damage a tankless water heater could do is equivalent to the damage a leaky faucet could cause, so it's a much safer option for your home.

    What Is the Typical Tankless Water Heater Installation Cost?

    Tankless water heater installation typically costs more than conventional water heater installation, but it pays off over time. The initial cost to purchase and install a tankless water heater system is between $1,200 and $3,500.

    You can expect to pay between $500 and $2,000 for a tankless water heater system, though the cost depends on the model you choose and the size your household needs. Installation costs typically add another $500 to $1,500 to the total cost, but the installation cost varies based on the system's fuel type. You can choose between the following tankless heater fuel types:

    • Gas: Gas-powered tankless water heaters can heat more gallons of water per minute than electric tankless heaters, which makes them ideal if you live in a cold weather climate or have a large household. The installation cost for a gas-powered tankless system is typically between $500 and $2,000.
    • Electric: Electric tankless water heaters are popular because of their easy installation and maintenance. An electric tankless water heater installation is best for small homes, and the installation cost is typically between $500 and $1,500.
    • Solar: Solar-powered tankless systems are the most eco-friendly type of water heater, and they offer the most energy savings. To install a solar-powered tankless water heater, you can expect to pay approximately $1,500 to $4,000.

    Installation costs vary because some homes require additional changes depending on the type of water heater a household chooses and how it needs to be installed. For example, you may need to hire a professional electrician to run new wiring if you're installing an electric tankless water heater.

    How Long Is the Installation Process?

    Installing a tankless water heater typically takes four to five hours, depending on the type of system and a household's needs. The installation process duration also depends on your location and which professionals are available when you need an installation.

    How long installation takes also varies based on where you choose to install the system. An outdoor tankless water heater requires fewer alterations, while an indoor system requires more wall alterations. During a tankless water heater installation, a professional will complete the following tasks:

    • First, the technician will turn your home's incoming water off.
    • If you are converting an existing system to a tankless system, the installer will disconnect the existing system from your home's power and water lines, remove it and dispose of it properly.
    • After removing the existing system, the tech will mount the tankless water heater on the wall where they determine it will fit best.
    • If you have a gas-powered tankless water heater, the installer will also install ventilation ducts and a large flue.
    • Next, the technician will connect the tankless system to your home's water line.
    • If you have an electric tankless heater, the tech will plug the system into its power source.
    • If you have a gas tankless water heater, the installer will connect the gas supply line and ignite the pilot light.
    • Finally, the professional will test your home's hot water to ensure the system operates properly.

    Can I Install My Own Tankless Water Heater?

    If you're wondering how to install a tankless water heater, you need to understand that hiring a professional is the best way to complete installation unless you have professional experience yourself. Installing a tankless water heater requires plumbing, electrical work and sometimes soldering.

    Hiring a professional is the safest and most efficient way to install a tankless system. A professional installation ensures your system operates smoothly and saves you money on potential damages that could occur if you attempt installation on your own.

    How Can I Find a Professional Plumber for Installation?

    It's essential to hire a professional plumber who can provide quality service and install your tankless water heater properly. An experienced plumbing technician's services may cost more than others, but you receive what you pay for in this situation.

    Hiring an inexperienced technician to save money on installation could result in future damage or a faulty system, so take your time and research your best options.

    You can find a professional plumber for installation by searching online, talking to friends and family, and comparing reviews. Search for technicians in your area, and browse their website for client reviews. You can also check other websites that provide honest and accurate reviews so you know what you can expect from different technicians. If someone you know recently got a tankless water heater, talk to them about their experiences with any technicians they hired.

    Can You Convert an Existing System to a Tankless Water Heater?

    You can convert an existing water heater system to a tankless water heater. You can choose from many different types of tankless water heaters to find a system that best meets your home's needs. Whether your home has electric, gas or solar power, you can purchase a system that matches your needs and convert your conventional water heater to a tankless unit.

    How Much Does It Cost to Convert to a Tankless Water Heater?

    To convert an existing water heater to a tankless water heater, you will need to hire a plumber and pay for installation and conversion services. During a conversion, a plumber will remove your existing system, bring your plumbing system up to code and install the new system. The cost to convert an existing system to a tankless water heater is based on the following factors:

    • New tankless water heater system purchase: As mentioned previously, the first cost you will most likely factor into your total installation cost is the new tankless water heater system purchase, which can range between $500 and $2,000.
    • Existing tank removal: Technicians typically charge between $100 and $500 to remove and dispose of your existing water tank.
    • Gas line upgrade: A gas line upgrade costs between $350 and $750.
    • New electrical outlet: A new electrical outlet installation costs approximately $150 to $300.
    • Permit: Most towns and cities require homeowners to have a permit before installing or replacing a water heater. You can expect to pay between $25 and $250 for this type of permit.
    • Plumbing update: It costs approximately $100 to $500 to have a technician update your plumbing system for your new tankless water heater.

    Do Tankless Water Heaters Run out of Hot Water?

    Since tankless water heaters heat water on demand instead of storing hot water, they provide endless hot water. Conventional water heaters can only provide the amount of water in the tank before needing to heat more water, but tankless heaters can heat water whenever you need it and for as long as you need it.

    It may take a tankless water heater slightly longer to deliver hot water at first. However, since the water heats as it flows through heated elements, it can never run out of hot water.

    When Should I Purchase a Tankless Water Heater?

    Many people wait until their existing water heater fails or reaches the end of its life span to upgrade to a new system. If your existing water heater is nearing its end, this is the perfect opportunity to install a tankless system. However, you don't have to wait for your current system to fail to install a new one. Upgrading to a tankless water heater is an excellent way to start saving money on your energy bills and enjoying the convenience of an endless hot water supply.

    How Can I Maximize My Savings With a Tankless Water Heater?

    Tankless water heaters help households save money due to their operational efficiency. However, you can further increase your savings with some helpful tips. Maximize your tankless water heater's energy efficiency with the following strategies:

    • Reduce water usage: The less hot water your household uses, the more energy you will save. Consider installing water-saving and low-flow fixtures, and try to shorten shower times as much as you are comfortable doing so. You can also wash laundry in cold water to conserve energy.
    • Avoid using multiple appliances: Using several appliances at the same time demands more performance and energy from your tankless water heater. Try to use only one appliance at a time when you can. Wait until after your shower to run the washing machine or dishwasher, and ask household members to shower one at a time if possible.
    • Schedule regular maintenance: Regular maintenance extends your tankless water heater system's life span and helps the system continue operating at peak efficiency.
    • Check for available rebates: The government offers rebates for energy-efficient systems such as tankless water heaters, so researching available rebates can help you save money on your initial purchase.
    • Purchase a home warranty: Most home warranties cover home systems including tankless water heaters. Purchasing a home warranty that covers your tankless system can save you money if you ever need repairs or a system replacement.

    Upgrade Your Water Heater System With Ingram's Water & Air

    Upgrading to a tankless water heater is a fantastic investment. With a tankless water heater, you can enjoy the convenience of having hot water whenever you need it and save money on your energy bills. Hiring a professional to install a high-quality tankless water heater ensures your system operates smoothly and delivers the hot water you need.

    Ingram's Water & Air offers a wide selection of indoor and outdoor water heaters. Our high-quality systems are reliable and energy efficient to provide homes with the hot water they need. Consider a tankless water heater if you're ready to increase your comfort and reduce your energy bills. Browse the selection of water heaters at Ingram's Water & Air to find the right system for your home.

  • What Tankless Water Heater Size Do I Need?

    What Tankless Water Heater Size Do I Need?

    Are you considering a tankless water heater for your home? Find out the best tankless water heater size to fit your daily needs.
  • Tankless Water Heater Buying Guide

    Tankless Water Heater Buying Guide

    In the market for a tankless water heater? Not sure what you need? Bewildered by the different options? Our buying guide can help. 
  • Tankless Water Heating - Common Questions

    Tankless Water Heating - Common Questions

    If you have been thinking about getting tankless water heating for your home, but have some questions, we have got answers!