Pros & Cons of Tank vs Tankless Hot Water Heaters

Tankless vs Traditional Hot Water Tank

Pros & Cons of Tank vs Tankless Hot Water Heaters

You don’t notice how much a water tank heater affects your quality of life until you’re standing in the shower and the water turns cold, a telltale sign you need a hot water tank replacement.

If you share your home with a few people,  you’ll notice you may run out of hot water and have to plan showers around others.

Not only does having the right hot water tank affect your daily routine, but it will also affect your pocket through savings in your utility bills.

When it comes time to purchase a new home or replace your water heater in your home, in addition to the cost, you should also consider efficiency, and longevity. Water heaters can be a very costly investment but the good thing is that they have an average lifespan of 10 years plus so it makes it more than worthwhile.

Traditional Tank Hot Water Heaters

Storage tank water heaters are still the most common water tanks in Sydney homes.

Traditional storage water heaters store and heat water in an insulated tank will typically hold anywhere from 110 to 150 litres of water.

A pipe which protrudes from the top of the tank deliver hot water to its destination (your taps and showers). When water is depleted, the tank is refilled with water from your standard water supply and is heated and stored via gas or electricity, and the cycle continues.

Pros and cons of traditional water heaters


  • Lower initial cost – A storage  hot water heater installation costs are usually half as much as a tankless water heater.
  • Easy and inexpensive to replace – since they have been around for a long time, it means you already have all the pipes and plumbing required for it to be installed. Less installation complications means that there’s less that can go wrong.


  • More energy to run which means hire utility bills – They heat and reheat water at a pre-set temperature regardless of your water needs. This increases your utility bill-especially in winter .
  • bulky and harder to place – They occupy more space and don’t look as good as tankless
  • Hot water can run out if the tank is too small or if you add people to your family. This problem can be avoided by purchasing a larger tank, though this also means higher utility bills too
  • Shorter lifespan – Lasts 10-15 years. This is half the timeframe of what a tankless water heater is expected to last

Tankless Hot Water Heaters

Tankless water heaters use high powered burners to rapidly heat water when it comes into contact with a heat exchanger powered by gas or electricity and is delivered directly to the faucets without a storing tank.

The newer tankless water heaters are more energy efficient because they only heat hot water at the time it is being used.

Even though it is newer, it still isn’t perfect or suited to everyone. There are pros and cons to purchasing one of the water heater systems.

Pros and cons of tankless water heaters


  • Saves money in the long run – For homes that use 150 litres or less of hot water daily, on demand or tankless water heaters is approximately 30% more energy efficient than traditional hot water tanks
  • Looks better and takes up less space – They are small and can be installed practically any wall surface
  • Lasts longer with a lifespan of approximately 20 years which is double of a standard hot water tank
  • Delivers hot water on demand – Produces hot water at a rate of around 15 litres per minute


  • Higher initial cost – Costs $2500 to $5000 installed depending on size, model, brand etc
  • You may need to upgrade to a thicker / bigger gas pipe which adds significantly to the upfront cost – Replacing a traditional hot water tank with a tankless system is more complicated and that will most likely increase costs even further

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