Water Heaters: Tankless or Heat Pump?

DAN: Well, we’ve got a house with five bedrooms, three baths and, eventually, two adults and three kids, we’re hoping.

TOM: OK. (Leslie chuckles)

DAN: And the water heater is about 12 years old. I know that’s getting towards the end of its life. I was trying to decide whether we should go with a tankless water heater – someone told me if you do that with that size of a house, you might want two; or if we should go with a high-efficiency heater with a tank.

TOM: Both of those ideas are solid and here’s why. A tankless water heater is only going to heat water when you need it and, because you have a large house, the tankless water heaters are also very small; you can have two of them. So you essentially zone your hot water – you have one upstairs and one downstairs – and what that’s going to do is make sure you never have to wait very long for hot water. Because even if you have a tankless water heater, if it’s in the basement and, you know, your master bath is up on the second floor, you know, it could take a few minutes for the hot water to go through the system and work its way up there. So that’s why putting two in is a good idea.

Now, the other option is a heat pump water heater, which is probably the most efficient out there right now.

LESLIE: Yeah, there’s actually a model out right now from Rheem called the HP-50 and it’s super quiet.

DAN: Does that involve a tank? I’m not real familiar with their heat pump.

TOM: Yeah. It’s brand new. It’s a heat pump water heater. It’s sort of like a tanked water heater with a heat pump built into it and, basically, it’s more energy-efficient than either electric or even a gas water heater. You can save as much as about $300 a year on your energy costs and it also qualifies for federal tax credits right now, so you can get up to $1,500 of the cost of the product …

LESLIE: And you know what, Dan? Some of your local utility companies even offer an extra rebate. So if this is a model you’re considering, you might want to contact your utility company just to see if there’s something that your state or your local utility company might offer in addition.

TOM: Yep, it’s called a heat pump water heater. It’s made by Rheem; the HP-50.

DAN: And one would cover the whole house; wouldn’t need two?

TOM: Yes, correct. You wouldn’t need two.

DAN: OK, very good.

TOM: Why don’t you take a look at the website for Rheem? It’s Rheem.com. And the website for that particular product is RheemHPWH.com for heat pump water heater. OK?

DAN: Very good. Thank you both.

TOM: Alright? You’re very welcome. Thanks so much for calling us at 1-888-MONEY-PIT.