Most people choose a new water heater in a hurry, standing in a wet basement. It is worth deciding in advance, because the choice affects your gas or electric bill for the next decade and more.
The two kinds
A tank heater keeps 40 to 80 gallons hot all the time. It is simple, familiar and comparatively cheap to buy and to install.
A tankless heater heats water only as it flows through, so there is no tank and no standing loss. It is smaller, lasts longer, and costs more to buy and, usually, a good deal more to install.
Cost to buy and install
A like-for-like tank replacement is the cheapest option. The new heater connects to the existing pipes, vent and gas or electric supply.
A tankless gas heater needs a larger gas supply line than most tank heaters, a new vent through the wall or roof, and a condensate drain on the efficient models. Those three items are where the installation cost comes from. Going tankless in a house that has never had one commonly costs two to three times a tank replacement, all in.
Electric tankless heaters are cheaper to buy but need a very large electrical supply. In many older Bergen County houses the panel cannot provide it without an upgrade.
Running costs
A tank loses heat through its walls around the clock. A tankless heater does not, and the efficient condensing models turn more of the gas into hot water. For a typical household the saving is real but modest, and it takes years to repay the higher installation cost. The saving is larger for a house that uses little hot water, because the standing loss of a tank is then a bigger share of the total.
How much hot water
A tank gives a fixed amount at full temperature, then runs out and recovers slowly. Two showers and a laundry load in a row will empty a 40-gallon tank.
A tankless heater never runs out, but it can only deliver so many gallons a minute. One model may handle a shower and a sink together, but not two showers and the dishwasher. Size it for the busiest ten minutes of your morning, and remember that incoming water is much colder in a New Jersey January than in July, which reduces the output.
Space and lifespan
A tankless heater hangs on the wall and frees up the floor. It also lasts longer, often twenty years against ten to twelve for a tank, provided it is descaled regularly. In hard water areas, that annual service is not optional, and skipping it is the usual reason a tankless heater fails early.
The middle options
- A high-efficiency tank with better insulation and a more efficient burner costs a little more than a basic tank and cuts running costs without any plumbing changes.
- A heat pump water heater is an electric tank that draws heat from the air around it. It uses far less electricity than a standard electric tank and there are often utility rebates. It needs a large, warmish space such as a basement, and it cools and dehumidifies that space, which many people count as a bonus.
- A larger tank, if the real problem is running out of hot water.
Permits and installers
In New Jersey, replacing a water heater requires a permit and an inspection, and gas work must be done by a licensed master plumber. A reputable installer handles the permit as part of the job. If someone offers to skip it to save money, that is a reason to choose someone else.
Questions to ask for a quote
- What size or flow rate do you recommend, and why?
- Does the price include the permit, removal of the old heater, and any venting or gas line work?
- What is the warranty on the tank or heat exchanger, and on the labor?
- For tankless: what does the yearly descaling involve, and can I do it myself?
- Are there utility or state rebates for the efficient options?
To get quotes, find a licensed plumber near your town.