Before you rush ahead and install a tankless water heater in your home you need to do some investigation to decide whether indeed it is the right option for you and your family. Be clear, I am a great fan of tankless water heaters and grew up with them 40 years ago in England, but like every appliance they have their pluses and minuses.

On the plus side:

1. You never need to worry about a water heater failure and flood while you are out for the day - let alone away on vacation. That peace of mind is worth quite a bit in my book.

2. A tankless water heater can easily last 20 years and we have heard of some lasting over 50 years, so over the long haul they can yield enormous replacement water heater cost savings.

3. Hot water in a family accounts for about 10-13% of their total energy bill. Using tankless water heaters an average family can save about $250 a year in energy costs.

4. Both federal and state governments are promoting the use of tankless water heaters so you might get as much as $100 credit for purchasing one. We predict that in the future all new homes will have tankless systems in them.

5. Hot water on demand is literally endless, so if the unit is properly sized, there is never a possibility of running out of hot water even if everyone in the family is using hot water for showers, dishwashers and laundry at the same time.

On the minus side:

1. While the cost of the tankless water heater is about the same as a conventional water heater, the installation is often much more expensive with the break even point at five years of more out. So if you are not planning on staying in your house very long this might not be a good choice for you. The plumbing part of installation is quite simple but most home owners will have to spend some money on electrical upgrades to their breaker box to bring in several dedicated 220 volt lines. The installation cost which can run as much as $500-$1500.

2. While tankless water heaters last so much longer than their conventional counterparts, they are not without some maintenance costs every 5 to 7 years. There are electric heating coils inside the water heater and this is its point of failure especially if air gets into the water pipes. This may happen more often than you think because the mains water can get shut off outside when road repairs are taking place and you may of may not get notified that this is taking place. Also if you shut off your water when you are going on vacation then you will have noticed that it “spits and sputters” on your return and you need to let the COLD water run for 5 to 10 minutes before turning on the hot water. The good news is that the element only costs $35 and can be easily replaced by the home owner. This is a spare part that we recommend having put aside somewhere so you never have to be without hot water.

3. You need to decide what is the perfect water temperature for your house which can be a bit difficult if you have bathrooms on 3 different levels. The bathroom on the highest level will always have water which is slightly cooler than downstairs. We all typically run the water hot then mix it with cold to get the perfect temperature. Stands to reason that you do not want to spend money heating up water only to then cool it down afterwards. Relearning that behavior will take some getting used to.

4. If you have the kind of furnace which is designed to “free heat” your water heater, then you are only heating up your hot water in the summer months, which would make your payback period much longer and may give you pause to consider whether it is a viable project for you.

This being said I gamely volunteered to be the corporate guinea pig to install a tankless water heater in my townhouse. I chose a top of the line Eemax system and opted for external digital controls to regulate my water temperature. I have an oil based system and it was 10 years old and is an accident waiting to happen. My townhouse is 25 years old, so I do have a modern circuit breaker panel system - but it was too small to accommodate any more breakers. So we need to put in an additional panel or replace the existing one with a bigger one. I was worried that this would put this project over budget but in fact I have been quoted $200 plus parts for the electrical and $100 for the plumbing so I am not expecting my total installation bill to be more than $350 which rivals the installation cost of a regular water heater. So considering this is Boston and not the cheapest part of the country, so I consider myself lucky. I am however going to take lessons on how to install a burnt electric coil which cannot be more complicated than changing a light bulb, and a way to avoid unnecessary labor costs down the road for a trivial repair.

I will let you know how the installation went and my assessment of the effectiveness of the tankless system in the next few weeks….