Tankless Water Heaters vs Hybrids: What’s the Difference?

Finding the right tankless water heater for your home

When it is time for a new water heater, you want to know that you have the most energy-efficient and cost-effective option. There are several different types of water heaters to choose from, but some of the more energy-efficient options are tankless water heaters and hybrids. Learn here the difference between these two types of heaters and how they compare for savings.

Differences Between Tankless and Hybrid Water Heaters

All water heaters are not the same. There are a lot of differences between tankless water heaters and hybrids, from installation and operating costs to energy efficiency, but it can be difficult to make a decision about what type of water heater to have installed.

To help understand your options, here are the details of each type of water heater.

Traditional, Storage Tank Water Heaters

Before diving into the features and benefits of tankless and hybrid water heaters, it is important to present the difference between these water heaters and the traditional storage tank water heaters. Standard water heaters can be either gas or electric, and they have a storage tank of 20 to 50 gallons. They are very inexpensive to purchase and install, but they have a significant energy cost. Both tankless water heaters and hybrids are much better options for efficiency, operating cost, and the environment.

What is a Tankless Water Heater?

Tankless water heaters are fueled by natural gas or electricity. These are also called “on demand” water heaters, because they don’t have a tank that fills with hot water. Instead, the water is heated as it is called for. This means that not only is a tankless water heater energy-efficient, it can actually help you use less water.

Size is another advantage of tankless water heaters. They are very small compared to other options. Most of them are about the size of a carry-on suitcase, and they can be mounted on the wall of your utility room or garage. They do not require a lot of space to function, making them perfect for smaller homes.

A tankless water heater is designed to heat about 2 to 5 gallons of water per minute. This is usually sufficient to maintain hot water for all of your daily needs. The average homeowner uses 84 gallons of water per day. The tankless water heaters are easily able to keep up with that demand.

It is important to note that your home may run differently with a tankless water heater. Because the water is heated as it is needed, you may not be able to run the clothes washer, dishwasher, and shower at the same time. How fast the water heats up also depends on the temperature of your ground water. The colder the water, the longer you’ll be waiting for hot water after turning on the faucet.

What is a Hybrid Water Heater?

The hybrid water heater is a totally different animal. If you are going with an electric water heater, the hybrid heater could be your best option. These water heaters do not run on natural gas or propane, but rather electricity.

Hybrid water heaters have a storage tank just like traditional standard tank water heaters. It is the way that the water is heated that makes them unique. Instead of creating heat, the hybrid water heater moves heat from the surrounding air into a converter that uses it to heat the water using a heat pump.

Water Heater Repair and install Services In Columbia Sc
Kay Plumbing can help you find the right size tankless

Because they take their heat from the surrounding air, it is important that these water heaters are stored in a climate-controlled area of your home in a spacious utility room. Putting a hybrid water heater in a small tight space simply won’t work. But because it pulls heat from the environment instead of generating its own heat, hybrid water heaters are among the most energy-efficient on the market.

Now that you have had a chance to see what tankless and hybrid water heaters are and their features, let’s get down to the business of comparing them.

Comparison of Tankless Water Heaters vs Hybrids

There are four main factors to consider when choosing a new water heater—performance, energy efficiency, operating costs, and installation costs. Here we will break down these items in a comparison of tankless water heaters vs hybrids.

Water Heater Performance

Your primary concern when choosing a water heater is performance. You want to know that your water heater will be able to meet the demands of your household. Tankless water heaters and hybrids can give you better performance than a standard storage tank water heater. They are also both able to stand up to the demands of the average four-person household.

There are some differences in how the two types of water heaters operate, which can affect performance. On demand tankless water heaters heat the water as it is required, which can mean that the water heater may not be up to the task of heating water for multiple purposes at one time. You should be able to easily do two things at once with hot water, but a third would be pushing the limits of the tankless water heater.

Hybrid water heaters have their own performance issues. Because they have a tank, you don’t have to worry about running out of hot water with normal use. However, the water may not get as hot as it does with other water heaters. Since the water is heated with heat from the surrounding environment, if that environment doesn’t have enough heat to pull through the system to heat the water, it might not get as hot.

Water Heater Energy Efficiency

Hybrids and tankless water heaters are both far more energy-efficient than standard storage tank water heaters. A tankless water heater saves energy by only heating water as it is needed instead of maintaining constant heat on a tank. Hybrids save energy by taking heat from the air and pumping it to heat the water, which means that it never generates its own heat. Clearly, the water heater that doesn’t generate its own heat is going to be the most energy-efficient. However, that doesn’t necessarily translate into lower operating costs.

Operating Costs for Tankless and Hybrid Heaters

The operating costs for a tankless water heater vs hybrid water heater differ depending on the type of fuel you are using. If you only have electric service, you will have to go with a tankless water heater or a hybrid. In that case, the hybrid will have lower operating costs because it doesn’t generate its own heat.

However, if you have gas service and can use a gas water heater, the tankless water heater will be cheaper to operate on a daily basis. This is because natural gas is typically cheaper than electricity. And, tankless water heaters are still more energy-efficient than storage tank water heaters.

In general, the operating costs of the two types of water heaters are nearly the same. The average annual operating costs of a hybrid water heater is about $190 per year. Gas fueled tankless water heaters operating costs are about $228 per year. Of course, if you have a large household your costs may be higher.

Hybrid and Tankless Water Heater Installation Costs

The installation costs for hybrid and tankless water heaters will vary somewhat depending on the facilities that you already have available. Tankless water heaters sometimes require a larger gas line to be run to the unit so that the demand for hot water can be met at peak usage times. If you want a hybrid water heater, it has to be in an open area, which may mean needing to run electrical to a different part of your home.

In addition to these potential installation costs, there is the cost of the actual water heater and its basic installation. The average cost of these water heaters is about the same. Your tankless water heaters cost an average of $1600, while hybrids cost an average of $1660.

Final Comparison

As you can see, both tankless water heaters and hybrids are highly energy-efficient, cost effective, and environmentally conscious. If you only have electric access for your water heater, and the space is open, a hybrid may be the best option. However, if you have gas fuel, a smaller space, and want to save water as well, the tankless water heater is typically preferred.

If you still have questions about which type of water heater is best for your home, we are here to provide you with the information you need to make an informed decision. You can reach us by online chat, form submission, or phone.


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