Hot water heating accounts for 20% or more of the average United States households annual energy costs. The average yearly costs for conventional gas or electric storage hot water heater is $200 or $450, respectively. Hot water heaters that store water raise and maintain the water temperature to the temperature setting on the tank - usually between 120 and 140 Degrees F.
Demand tankless water heaters are what the majority of folks use in the rest of the world. They began appearing in the United States about 25 years ago. Unlike "conventional" tank water heaters, tankless water heaters heat water only as it is used, or on demand. A tankless unit has a heating device that is activated by the flow of water when a hot water valve is opened. Once activated, the heater delivers a constant supply of hot water.
Even if no hot water is drawn from the tank, the heater's burner will operate periodically to maintain the water temperature. This is due to "standby losses": The heat conducted and radiated from the walls of the tank and in gas-fired water heaters through the flue pipe. These standby losses represent 10% to 20% of a households annual water heating costs. The way to reduce this ever rising cost is to use a tankless water heater.
