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Tank vs Tankless: Which Water Heater is Right for You?

Water Heater Installation

The average American household spends about 18% of their total energy expenditure on water heating. It's a surprisingly high amount! This is why it's so essential to make an informed decision about the water heater you are going to place in your home.

To help you make the best investment for your home, the team at Wolff's wants to break down the two main types of water heaters, going over the pros and cons of each.

Storage Tank Water Heaters

How They Work

Storage tank water heaters, or traditional water heaters, have been the standard for decades here in the States. They function through a straightforward process. Water is warmed up, typically by natural gas, and kept for later use in a tank so that when you turn the hot water knob on your shower or sink, the water is ready to go.

The Pros

There's still a lot of flexibility to offer with a tank storage system. For example, deciding on the size of the tank can make a big difference in the monthly costs. Storage tanks typically vary between 20 and 80 gallons depending on how much water you need. Additionally, while natural gas is most common, other fuel sources such as electricity are becoming more widespread.

With that in mind, a storage tank system is a great option if you're used to having one and like that setup. They typically have a lower initial installation cost, so they are ideal if you're planning on moving in the next few years.

The Cons

However, it's important to recognize some of the potential downsides of the storage tank system as well. The main one is standby energy loss. When you heat water on the stove, it won't always stay boiling once you turn off the heat. Your water heater works in much the same way. Your water heater will need to consistently add energy into the system to keep the water warm for when it is needed. This can lead to a lot of wasted energy when compared to the tankless system. The other downside is capacity. While any good installer will recommend a tank big enough to supply enough hot water at any given time for the household, sometimes there isn't enough to go around. If that's the case, you'll need to wait for the hot water tank to fill up before it can resupply water.

Tankless Water Heaters

How They Work

Tankless water heaters are designed to limit some of the downsides of a traditional tank system. It does this by eliminating standby heat loss and capacity issues by heating up water only when you need it. This "on-demand" system ends up using a lot less energy for most people, so you should expect lower monthly energy bills.

The Pros

There's a lot of flexibility with tankless systems as well. You can install these at high use appliances alongside an existing storage tank system, so you can have hot water for showering whenever you need it for as long as you want.

The Cons

There are still some drawbacks to consider. For instance, the installation cost is typically higher. Additionally, tankless water heaters are limited in how much hot water they can produce at any given time. If multiple people in the house need to use hot water at the same time, you may not have enough capacity to keep up!


Your water heater will be a significant expenditure for your home, both in up-front installation cost and monthly energy bills. It's essential to choose a system that works best for your household. Tank systems are still far and away from the most popular kind of water heater, but they aren't your only choice! Tankless systems have their own benefits, and if you already find yourself running out of water frequently can be deployed at point-of-use to assist your already functioning tank system. Overall, we want to share our expertise on all things plumbing and heating, so if you have more questions, just give us a call!

Our Spearfish, SD plumbing & HVAC pros are here to help you with water heater repairs or a new installation. Call us today at (605) 638-9996 or fill out an online contact form to schedule your appointment today!