Will a Tankless Electric Water Heater Save Me Money?

  • Transcript

    LESLIE: Now we’re heading over to Tennessee where Steve wants to talk about water heating. How can we help you?

    STEVE: My water heater seems to be going out – it’s about five or six years old – and I’ve been hearing commercials on your show about tankless water heaters and other forms of water-heating solutions. And I was just wondering, is that costly? Or is that a better way to go than putting another tank in?

    TOM: OK. So you say the water heater is going out. Is this a gas water heater?

    STEVE: It’s electric.

    TOM: It’s electric? And it’s going out. So what’s happening to it?

    STEVE: It’s leaking.

    TOM: Oh, it’s leaking at five or six years? Really? That’s just plain bad luck, Steve.

    STEVE: Yeah, I know.

    TOM: Sorry. Well, let me ask you this question: how long you planning on staying in your current house? Is this the house for a while?

    STEVE: Oh, yeah, it’s forever house, hopefully.

    TOM: Generally, I would say I wouldn’t hesitate to install a tankless water heater, except – and this is a big except – tankless water heaters that are powered by electricity don’t work that well. They don’t save you that much money. If you have the ability to power it with propane, for example, then it’s more realistic. But if you’re planning on powering it with electricity, then it’s not.

    So in that case, your options are to replace it with a standard, tanked electric water heater or you can use a real new type of electrical water heater called a “heat-pump water heater.” Heat-pump water heaters are more expensive but they’re much, much, much more efficient than a standard electric water heater.

    STEVE: Are those costly?

    TOM: Yeah, they’re more costly than a standard water heater. You know, you’re probably looking at maybe around 1,500 bucks for them, plus installation. So they’re much more expensive but they’re far more efficient.

    STEVE: That’s what I’ll do then. I thank you for answering my question.

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