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What are the pro’s and con’s of a tankless water heater?

Rheem_24_tankless_hot_waterIts not a great thing when your hot water cylinder is leaking and has to be replaced. The only real benefit under such circumstances is that you suddenly get an opportunity to look at a more modern and efficient hot water system for your home.

In New Zealand we are certainly spoiled with unlimited access to gas supply, whether it’s natural gas in metropolitan areas or LPG in more rural areas. With this in mind, the circumstance begs the question whether it is worth looking at tankless hot water heating.

Let’s look at some situations, site conditions and costs to evaluate the pro’s and con’s of tankless water heating.


Lets list some of the benefits tankless gas water heating offers.

Here are the top 5

  1. The cost of natural gas per KW (Which gas to select? see below) is on average 8 cents/KWh + $30/monthly fixed line fee, in comparison electricity is on average 28 cents/KWh offering a significant difference and savings. LPG will cost slightly more but has a much higher burning value. Most tankless water heaters are available in LPG and NG
  2. Continuous flow water heaters deliver an endless supply of hot water that will never run out, as they heat water when you need it, for as long as you need it.
  3. They heat on demand, rather than keeping water hot and stored ready for use, they use less gas than traditional storage water heaters, which is good news for the environment and you. Another important point is that when converting to tankless water heating, you are by default converting to mains pressure.
  4. Tankless water heaters mount conveniently to the wall, taking up less space, which is good news if you have a compact home site or apartment or are just short of space. You can finally convert that hot water cylinder cupboard into whatever your heart desires.
  5. Take advantage of condensing technology which makes some of these gas units 90% efficient saving you even more on your power bill.


What are some the disadvantages of tankless gas water heating?

  • The installation cost is approximately 30% – 40% more expensive than your conventional hot water cylinder installation. Unless you are using a Hydro unit, in most cases an external power point is also required which adds on average another $300 + GST to the installation.
  • Most tankless hot water units incorporate an electronic ignition system replying on 240 Volts. Unlike hot water cylinder storage, If you have a power outage, you wont have hot water.
  • Because cold water has to run through a heat exchanger first, it takes time, this time is translated into a flow rate. Flow rates on Continuous flow water heaters will always be lower than on hot water cylinders which means if you are already on mains pressure, you may notice a drop in pressure. To compensate for this pressure drop, you may have upgrade to the next size Continuous flow water heater. Sizing values are given in Liters per minute for example the Rheem VT 26  will supply 26 Liters per minute.
  • You must always ensure the water heater size you are buying is suitable for your home. If the unit is undersized, you may not achieve the temperatures and pressure you are used to or expect. Continuous flow water heaters are sized by total plumbing points and occupants. for more information please speak to our sales team.


Liquid Petroleum Gas (LPG): Is ideal when you dont have access to natural gas or the getting a supply of natural gas is expensive. LPG has a heating value of 102 (MJ/m3), so much more grunt than natural gas achieving high temperatures with less effort using less gas.

How much LPG gas will you need? A 45 KG LPG Bottle will on average evolve 21 m3 of gas at a cost of circa $90 per bottle. A tankless heater of 26L/ minute will use 200MJ, therefore you multiply the heat value by the amount of energy stored (21m3 stored per bottle x 102 = 2142MJ heat available ) The total is then divided by the demand, 2142 ÷ 200MJ = 10.71 hours. Thats 10.71 hours of showering on one bottle, or 64 x 10 minute showers. Great heating value giving you a long supply of gas.

Natural Gas (NG): If you already have NG on your property, no installation line fess will apply and tankless water heating would be very desirable. Natural gas has a heating value of 40 (MJ/m3) meaning you will use more to achieve a desirable heat. This something to consider when comparing costs with LPG. If available on your street and the cost to get a permanent gas line with meter onto the property is free or at low cost, then this option would be an advantage as there is no handling of bottles onsite and you cannot run out.

Our technicians have developed further methods to save you even more on gas by using smart controllers and specialist appliance commissioning processes.

With variations of readily available gases in New Zealand, tankless hot water heating has certainly become the way of the future. Technology and efficiency is improving daily making this a desirable option for kiwi homes. Maybe It’s time you joined the gas revolution!

Hot Water Cylinders NZ are currently running a special to convert to a mains pressure tankless hot water heater for only $2800! Checkout our special deal here. Questions? Give us a quick call.