The Best Tankless Water Heaters in 2020

Few would dispute that hot water on tap is one of the basic amenities of modern living. We need our hot water for showering, washing our hands, our dishes, and sometimes cooking.

However, the ways by which it ends up conveniently flowing from the faucet head can vary considerably. In most of the industrialized world, hot water is a public utility that comes with a corresponding bill. 

If you’re living in a rural area, or simply want to skim from your monthly expenditure, you can choose from any of the myriad models of household water heaters available. As the title already lets us know, this article covers the best tankless water heaters.

Our Pick

Running on either 240 or 208-volt systems it can handle some 29 KW of power, which gives it enough GMP/h in temperate climates to service an entire household.

The manufacturer is honest enough to specify that with an incoming water temperature of 42 F, the unit can only heat 3.1 gallons every minute – just enough for a shower and a faucet running at the same time. You shouldn’t expect it to offer the same performance as a gas unit anyway, but this is somewhat mitigated by the fact the Eltron Tempra employs a smart management system that reduces water flow for better heating in cold weather.   

Besides being one of the most high-spec electric units out there, the Eltron Tempra 29 seems to also score top marks in reliability. We were surprised by the number of reviews this product received from contractors and longtime owners stating their units never suffered a malfunction, even in a decade of use.

How expensive this would be to install depends in large part on one’s own skill, but we did read reports of folks finishing the job in half a day without the need to hire a contractor.

What we like:

It offers good performance for an electrical unit, on par with many gas-powered models, without the added hassle of fitting it to a gas line.

Employs advanced sensors and can be optimized to work better when the groundwater is particularly cold.

Praised for its reliability, appears to be a well-proven, dependable design that can offer many years of good service.

According to user reports, people with a modicum of technical skill should be able to install this in around half a day, saving a considerable amount of money on contractors.

What we don’t:

Discerning readers might already suspect that the Stiebel Eltron Tempra 29 comes at a premium price – which it certainly does. However, high production quality seems to justify the additional cost, and the long life you might expect from it translates in good value for money.

How we chose the best tankless water heaters

With so many models to pick from, finding the best tankless water heater for your needs can be a real chore. To come to your aid, our team of researchers looked through hundreds of product reviews, from both customers and professionals, to make a small selection of some of the better products available on the market.

After setting our eyes on a dozen or so well-reviewed units, we proceeded to conduct in-depth research on each one and narrowed our list down to just four, which we hope are covering a wide enough range of needs to prove attractive to as many readers as possible.

Covered below are the criteria we used to make our selection, as well as a comprehensive guide that we hope will aid you in making an informed buying decision.

The best tankless water heaters

1. Rheem RTEX13

In case you find the Eltron Tempra 29 too sizable for your studio apartment or forking a little extra for premium German manufacturing will be too punishing on your budget, then you might be interested in one of the better-received residential tankless heaters we found, the RTEX13 from Rheem.

Although not a point-of-use device, as it can be connected to multiple showerheads and faucets, this unit takes only a small amount of space on the wall, and it is light enough for the installation to be a one-man job.

Furthermore, most of the adapters you’ll need to set it up are already included in the package, minimizing the number of trips to the local hardware store. Like with the Tempra above, a number of technically skilled owners took care to mention that this is easy enough to install without the aid of a specialist.

Another aspect in which it shines is efficiency, with an almost unbelievable claim by Rheem of a 99.8% energy factor. It’s difficult to confirm that figure without some very precise measuring equipment, but what we can say is that all its customers are pleasantly surprised by how much they saved on the electricity bill with this unit.  

Last but not least, the RTEX13 features a number of nifty features, like an extremely sensitive thermostat that allows adjustments in 1 degree F increments.

What we like:

Extremely compact at only 4x9x13 inches and four pounds in weight. It can be placed in a small service bathroom or hidden away in a cupboard.

Relatively powerful for its size, at 3.17GPM and 13 KW it can act as the main unit for a studio apartment or small cottage.

It offers a lot of freedom in adjusting the temperature at 1 F increments. Furthermore, many users report its LED interface and additional features are a visible step up from the previous RT13 model.

Reported to be easy to install, the package comes with some additional parts.

What we don’t:

Running on 60 amps, this unit might be a little too power-hungry to be used as a secondary heater to assist larger ones in a house. It might have the same dimensions as a point-of-use model, but lacks all the functionality of one…

2. Rinnai RL Series 94iN

At the opposite end of the spectrum from the diminutive RTEX13 there’s the indoor 94 version of the acclaimed Rinnai RL Series. At maximum capacity, this unit can heat a whopping 9.4 gallons of water per minute, enough for a large house if you happen to leave in a temperate region of the country.

Despite its size and power, putting out just shy of 199,000 BTU (enough for an Energy Star certificate) at the maximum setting, the RL 94iN won’t make you feel bad for the environment.

We won’t bore you with how this works, but what it does is cut down on the time it gets hot water to get to a certain point of use. In addition to the obvious convenience, this also reduces the interval between when a faucet is turned on and hot water starts flowing, minimizing the amount of cool water thrown down the drain. People who’ve played around with this system report that it works quite well, and can cut waiting time significantly, especially for multi-story houses.   

Obviously, this is a gas-operated unit, and you’ll need plenty of space to mount it. The good news is that with enough patience, skill, and tools, you’ll be able to install it yourself and save a grand or so on contractors.

What we like:

A very powerful unit; can act as the main hot water source for a large or medium-sized house, depending on the climate.

The usual problem of “hot water delay” is mitigated by the use of a new Circ-Logic system. This can also help you save on money in the long run, as you will have to let the water running for less time until it reaches the desired temperature.

Highly adjustable, from a minimum output of 10,300 BTU to 199,000, this will help save on gas when you don’t need the unit working on full power.  

What we don’t:

Rinnai promises a ten-year warranty for the heat exchanger, five for parts, and one for labor. However, many users have found this to vary greatly depending on the supplier, so beware.

3. Rinnai V Series V53DeP

When it comes to outside tankless water heaters, there are few models that get such consistently good reviews as the Rinnai V53DeP. People love it for its relatively small size, good adjustment options, good frost-resistance, and reliable, consistent output.

At 5.3 GPM is no slouch, but those living in large houses or northern regions might want to look for a version with a little more “oomph”. Even so, the output of this gas-operated unit should be enough for your average suburban home facing temperate weather.

It has an energy factor of 82%, which isn’t the highest, even for an outdoor, gas-operated unit, but given its capacity, it still fares undeniably well compared to a storage-tank model.

Customers report it’s significantly easier to install than similar models, due in no small part to its relatively small size and well-placed fixtures, so you don’t have to be the best handyman to set it in place.

Furthermore, it comes at an affordable price for an item of its type, and you won’t have to spend extra money for a Category II or Category III vent.

What we like:

Noticeably more compact than other outdoor tankless water heaters, this gives you more freedom in placing the V53 along the walls of your house.

Its small size also makes it easier to install, as you won’t have to break your back lifting it into place or have a contractor do that for you for a couple of hundred dollars.

People who used this Rinnai for multiple years find it tough and reliable, with few recurrent malfunctions or “weak parts”.

Powerful enough to fit most needs, members of the series putting out a higher output enjoy similarly favorable reviews, as a testament for the company’s overall level of craftsmanship.

What we don’t:

Multiple people complained they received the wrong order when choosing between the propane and natural gas versions of this product. Not a problem with the model per se, but you should be warned to pay particular attention when ordering nevertheless.    

Why should you opt for a tankless water heater?

The absence of a storage tank allows tank-less water heaters (also known as instant or on-demand heaters) to be significantly more energy-efficient than older models since there’s no need to maintain a large volume of water at a high temperature.

Furthermore, the maximum amount of water to be used at any given time isn’t limited by the tank’s capacity, although on-demand units can only handle a given flow rate (more about this below).

On-demand models only use compact heating elements to do their job, which makes these significantly smaller and lighter than their traditional counterparts. This means it’s easier to find them a proper spot in the house, and it might make the installation process significantly easier, assuming no modifications are required to the house’s electrical and gas lines.

With no water storage device to inevitably corrode and leak, potentially leaving you with a flooded bathroom, the best tankless water heater will also last for significantly longer and be easier to maintain than a traditional model of similar quality.

Some significant downsides most online specialists cite for on-demand heaters are high initial purchasing costs – up to three times as high as a storage-type unit – and installation difficulties, but only on case-specific bases.

Although these will ultimately prove significantly more economical and energy-efficient than any other alternative, instant water heaters still need to draw a lot of energy when doing their job. This can be demanding on the wiring and gas lines during peak operating hours.

In some instances, the electrical installation will need to be upgraded to accommodate a tankless heater, translating in significantly higher expenses and more hassle on the part of the owner, which might be tempted to settle for a storage tank unit in such instances. 

The good:

• Cheap to operate
• Ecologically friendly
• Longer lifespan than alternatives
• Easy to repair Takes little room
• Offers hot water on demand

The bad:

• High initial purchasing costs
• Demanding on the household electrical installation
• Most gas models might require expensive venting

How does a tankless heater function?

The inner workings of an on-demand water heater are fairly straightforward. When the hot water tap is turned, the flow is driven through S-patterned piping inside the unit, also known as a heat exchanger.

Either a gas burner or an electrical heating element is activated to warm up the water almost instantly as it passes through.  

The unit will also feature a safety thermostat, a flow meter, and inlet/outlet thermistors to determine water temperature and adjust the heating elements accordingly. Depending on manufacturer and model, these can potentially be bought separately when in need of replacement.  

Features to consider when buying a tankless water heater

Smaller and more energy-efficient than storage-type alternatives, tankless water heaters have gained an increased level of popularity in recent years. It’s not all roses, however, and tankless models can exhibit some drawbacks that would seriously decrease their convenience.

It is highly recommended to keep a few things in mind when pairing a water heater with the particular needs of your household.

Finding the right capacity for you

Since these devices don’t store any water, when applied to tankless water heaters, the term “capacity” refers to flow speed rather than net volume. This is the amount of water that can be effectively heated for a given period, expressed in gallons per minute or GPM.

Most units currently available on the market are rated somewhere between 2 and 8 GPM, which makes them effective enough to cover the demands of either a studio apartment or a regular suburban house.

It is important to note that a single unit might not be able to meet the needs of larger households, and could even lose in effectiveness compared to tank models due to constant demand. According to official DOE figures, on-demand heaters are 24 to 34% more efficient than older alternatives when daily water use doesn’t exceed 41 gallons, but only 8% to 14% more so when consumption is doubled. The same source recommends the employment of multiple small, point-of-use units for the best energy efficiency.  

It’s important to have a good idea of how much water you need to be heated during periods of pick use, otherwise, consumption can exceed the capacity of the tankless heater, leaving you with a cold shower.  

Just to give you a rough idea of what capacity you might need, we mention that showerheads, as well as kitchen and bathroom faucets produced after 1992, should use a maximum of 2.2 GPM. However, this figure can increase by orders of magnitude in older devices, reaching as high as 8 GPM in some cases. Dishwashers or washing machines that don’t warm up their own water should also be considered points of consumption.

The temperature rise and why you should pay attention to it

The initial temperature of the groundwater the unit will have to heat up is also an important factor to consider. It will take more energy to bring cooler water to a set temperature, which in turn impacts the overall capacity of the heater. The difference between incoming water temperature and the desired value is commonly referred to as temperature rise.

This will naturally vary throughout the year, but a good general rule to follow is to look towards a higher capacity unit if living in a cold area, while people from milder climates can get away with less powerful heaters.

The capacity of a model is most usually specified by manufacturers and reviewers as the GPM for a given temperature rise, or to somewhat simplify things, as the GPM for inbound water temperature vs. a set temperature value. Eg. 5 MPG for 70 F rise; or 5 MPG for 42 F to 112 F. 

The Energy Factor

A water heater’s efficiency is measured through a rating called the Energy Factor (EF), which refers to the quantity of hot water produced for a unit of fuel spent. The EF is arrived at by dividing the useful energy coming from the unit by the amount of gas or electricity going into it, and it is most commonly expressed as a percentage. The closer this figure is to 100%, the more efficient the heater.

According to the DOE and EPA a tankless water heater must “contain no more than one gallon of water per 4,000 Btu per hour of input with an input less than 200,000 Btu per hour.” to be certified under their energy star rating.

As a quick aside, the “Btu/h” in the quoted sentence stands for British Thermal Unit, and it’s a measure of heat output. While it might be an interesting specification to know for tech-heads, on-demand heater manufacturers prefer to rate their products in the manner highlighted above. Suffice it to say, models with a higher Btu value will heat water faster.

Deciding on the type of fuel

Tankless water heaters can be powered by either electricity, natural gas, or propane.

There are enough differences and trade-offs between gas and electric designs for each to warrant some closer attention.

Gas tankless water heaters

This might be the ideal solution for those already connected to a gas supply line, as gas on-demand heaters can deliver the best performance for a very low operating cost.

Larger units of this type can usually raise water temperature by 70 degrees at a speed of 5-9 GPM, which means they can serve most families of four or five by themselves. In terms of thermal units, a lot of gas models go as high as 200,000 Btu/h; or nearly three times as much as a traditional tank heater.

Besides its reliance on a gas line or large and cumbersome tank, the need for venting can be said to be a primary downside of this type of system. Federal regulation requires for tankless heaters to be installed with Category 2 or 3 ventings, which can get quite expensive, although the cost is somewhat mitigated by the superior resilience of these systems.

The need for venting can be eliminated by either opting for an outside-placed heater, or a state-of-the-art condensing tankless water heater. The first might make for a nice option for those living in areas with a mild climate while the second should be considered for its outstanding energy efficiency, in the mid-to-high 90%. By comparison, non-condesing gas models generally range at 80-85% but deliver this performance for an admittedly lower purchasing price.

Due to the potential hazards associated with the fuel these use, gas tankless water heaters will usually require professional assistance for installation, as well as yearly check-ups, depending on local regulations.

Electric tankless water heaters

What electric models lack in power they make up by offering better convenience. Usually a lot smaller than their gas counterparts, electrics are perfect for point-of-use service and are simple enough to install with or without professional assistance. 

Numbering fewer moving parts than the bigger gas-operated variety, they demand very little maintenance and tend to be relatively inexpensive for their size.

However, they’ll put quite a bit of stress on the wiring, and might be best avoided if the electrical installation in your house isn’t up to par, especially as more than one electric water heater is commonly required to service an entire household.

Electric units are significantly more energy-efficient than gas models, with figures as high as 99% EF not uncommon among the top performers in this class. This is somewhat offset by the higher price of electricity, which might make a gas-powered unit preferable for people living in certain states. 

Furthermore, most models don’t have a high enough output to service more than a studio apartment by themselves, a typical electric unit delivering only 2-2.4 GPM for a 70 degrees temperature rise whereas most common residential gas heaters can offer double the capacity, at around 5 GPM.  

A few things about installing the tankless water heater

Compared to the alternatives, the best tankless water heaters will always demand a high initial purchasing cost. If you have enough spare time, preferably some plumbing skill, and are handy enough, there’s the option of saving a bit of money by installing the unit yourself.

It’s not our purpose to offer a step by step installation guide – there are enough of those from authoritative sources in video format online – but only to highlight some things you might want to have in mind before getting to work.

• This should be a no-brainer, but always shut off the water supply to your house before beginning a plumbing project.
• The indoor gas-powered heater will also require a connection to a 120-volt circuit. It can be wired to a service panel or directly to an outlet. Depending on the wiring, you might also need a voltage regulator.  
• Before installing a gas unit, check if your gas meter has enough capacity to handle the additional load and ask the gas company if it supplies enough manifold pressure for your new unit to work effectively. Gas companies generally upgrade meters for a minimal cost.
• Gas-powered models will often need to be connected with the meter via a 1-inch pipe. Most building codes require for this to be installed by a certified professional. You might also want to add an additional shut-off valve to the unit, just in case. 
• Depending on where you live, a gas heater will require either a category II or category III venting, which is sealed tight with silicone, as the device produces quite a bit of vapor. If living in a cool climate, a damper might be needed to prevent blowback. Some models might require a condensation drain.
• Installing an electric unit requires far less preparation, but it is still advisable to have a professional electrician do it given the hazardous nature of AC current. Needless to say, close of the circuit to the heater before even thinking of touching any wiring.
• Check local codes if the electric heater will require a circuit breaker sub-panel. Some manufacturers package one with the unit, as it is a good thing to have in any circumstance considering the high strain electric heaters put on the wiring.   

Maintaining a tankless water heater

While generally agreed to be more resilient than a storage tank model, the on-demand water heater will still require regular maintenance to function at peak efficiency and last for many years.

The best tankless water heaters can have a lifespan in excess of two decades, but water residue can put them out of action in a small fraction of that time if not properly removed.

• Flushing the system involves running high-pressure water through the heater using a circulating pump, a pair of hoses, and a high capacity bucket. We won’t dwell on the specific steps here, the operation takes around two hours and all manufacturers offer detailed instructions on how it’s done for their particular products.
• Descaling is similar to flushing but focused on removing mineral deposits such as calcium instead of regular gunk. How often this process is undertaken depends on the water hardness in any particular region and can vary between six months to a year. It is more time-intensive than regular flushing, as it involves running vinegar for around 45 minutes through the system, followed by a half-hour rinsing.

Conclusion

Tankless water heaters offer at least two benefits no one can argue against. A constant supply of hot water that doesn’t take additional storage space, and energy efficiency currently unparalleled by any other alternative. We can add to the list a potentially huge lifespan that is bound to dampen the initial purchasing costs. 

Slowly replacing storage tank varieties in the US, Asian, and European markets, the future seems to belong to the on-demand water heater.

However, their various drawbacks, such as high electricity demands and a sometimes complicated, often expensive installation process still precludes this class of devices from being the ideal choice for each and every household.