Water Heaters 101: Choosing the Best Water Heater

Imaging for a second, if you will, that you have decided to take a long, warm shower on a blistering cold winter morning. As you think about the warm stream of water wrapping you up like a heated blanket, you gather your towel and the new day’s outfit and smile, knowing that said warmth is going to be the best part of your new day. In fact, it will probably even carry you through the cold, hard day ahead; through the nasty client that you are dreading meeting for the 11 o’clock meeting. As you turn on the water, you stand there humming a melody to yourself as you wait for the water to warm up.

After about 90 seconds, you begin to notice something is a bit off. The water had only risen to a lukewarm temperature, and then rapidly ran back to a frigid temperature that seemed to compete with the temperature of the blistering outside wind. You head over to your home’s electrical breaker box and notice that hot water tank is still switched “on”. You find out you’re your tank has been punctured and your basement is flooding. At this point, you remember that you spoke to your neighbor earlier in the morning on the way to pick the morning newspaper up from the end of your driveway. Hastily, you head over to the neighbor’s home with your towel and change of clothes in hand; knowing that he has less of a chance of denying your request to take a shower in his house if you show up and ask him face-to-face.

Now, this is quite the far-fetched scenario, that’s for sure. However, it is laid out in this manner to stress the importance of proper maintenance. Now, you may simply notice you’re your heating element has lost some of its efficiency over the years, to the point that you have to limit your shower to 5 minutes or end up with cold water. Either way, when it’s time to replace a hot water tank, doing research and understanding both your needs and your available options will allow you to make an informed decision and purchase the tank that best fits the needs of your household. In our buying guide, the research has already been done for you; so you can supplement the information that you already know; or use the guide as a jumping-off point for conducting more research. Also included below is a personal review of each type of product relevant to your needs, which can provide you with priceless real-world feedback of the product already, being used in-house. This experience is rather unique, and can arm you against over-zealous salespersons who are more worried about a commission than they are worried finding you the right product. So, without further adieu — welcome to the buying guide.

History of Water Heaters

Imagine living in the days of old, where the only way to take a hot bath was to boil water over a stovetop; and then doing everything you could to wash your body and rinse off before the temperature of the water caught up with the temperature of the outside air. Now, you may have experienced having to take such a bath during times of electrical failure, as I have. This is rather uncomfortable, especially if you are the type of person who enjoys the warm embrace of a hot shower first thing in the morning or last thing before bedtime.

Well, believe it or not, this was the norm that people of society had to deal with every day of their lives up until the very end of the 19th century. That’s right, hot water tanks are just a little over 115 years old, with the predecessor to today’s devices invented in 1889 by a Norwegian inventor named Edwin Ruud. Now, this was not the first water heater by any means, but it was the first type to see widespread public use. Other types that were invented in the 19th century included wetback stoves and storage-type heaters, which more closely resemble the types that most Americans have in their homes today, by which the water is stored in a tank and heated by an internal heating element that is operated by a solenoid and electrical current.

Now, the newest type of device is the tankless water heater, which is a type of system that instantaneously heats the water as it flows from the faucet and through the device. There are many advantages to this type of device, including space-saving and energy efficiency. There are also a few disadvantages, which will be described in detail below. The bottom line here is that, when it becomes time for you to replace or modernize your current system, there are quite a few options on the market, and only you can decide which will be the best for your heating needs.

Internal Part of the Water Heater


  • In a conventional water heater, the tank is the part that is most visible and that everyone is familiar with. This is the metal container that holds generally between 30-60 gallons of water at a time. The tank capacity is one of the most important decisions to make when choosing a water heater.
  • The dip tube is the port of entry for incoming water filling the tank. This can be seen where the hose enters the port on the heater.
  • Shut off valve is a required valve that will stop water from entering the water heater when there is too much pressure in the tank. On gas heaters, there is also an emergency shut off valve for the gas supply as well.
  • Thermostats are rather self-explanatory. These accurately measure the temperature of the water in the device.
  • The hot water output pipe is the pipe that supplies water to your family.
  • The drain valve is essentially a plug for the tank that can be accessed to empty the tank if a repair is needed.
  • The anode rod is a long magnesium/aluminum rod with a steel core that exists to prevent corrosion.
  • Pressure relief valve safety device inside the tank that is used to regulate the internal temperature.

How it Works

So, as with anything in life, your author is the type of person who believes that, in order to make a fully-informed decision, it is very important to know the “Ins-and-outs” of how your potential new device operates. In fact, I believe this is such an important factor in making a decision; I will not make a purchase until I am fully aware of how the new device functions. Some salespersons may find this irritating, but they are not the individuals who will be stuck using the item for the next few years. Doing some preliminary research can be a great help for understanding how these devices operated, as well as how many replaceable and irreplaceable parts that may be included with a certain subtype of the same device. When it comes to hot water heaters, there is no exception here, as there are quite a few types of these devices.

Types of Water Heaters


Electric, Gas, or Solar

As mentioned above, when dealing with the power source of the water heater, you must make a choice between electric, gas, or solar. In the Southern United States, most people do not have a natural gas supply to their homes. As such, electric tanks are the most common heaters employed in that region of the world. There is usually not even an option for a gas tank. The opposite is true in the Northern U.S., where in-home gas lines are in every home. In this case, the consumer can choose between all three, with gas heaters having a few advantages, being

  • Gas heaters are generally more affordable to purchase.
  • Gas heaters generally heat the water faster, as an open flame is employed for heating.
  • Gas heaters generally have more replaceable parts than electric heaters, making their total cost of ownership from a repair standpoint a bit more affordable.

Tankless Water Heaters

Tankless heaters are fast becoming a major player in the preference of water heaters. I recently toured renovations made to a local restaurant. Upon entering the dishwashing area, the manager was very proud to point out his new industrial, “state-of-the-art”, tankless water heater. It certainly seemed like a marvel of modern technology.

It is absolutely true that these devices are much more efficient than a tank system. They heat the water instantaneously, eliminating wasted power (cutting your electric bill) and also work on an in-demand basis — meaning that your water will always stay hot! The gas valve simply opens up when the hot water is turned on, and the thermostat measures the temperature, using smart technology to calculate how long it should take for the water to flow past the burner or heating element.

How much will a tankless water heater cost? The upfront costs of a tankless water heater is usually 2 to 2.5 times more than a conventional tank-style water heater. This is the biggest drawback I’ve found.

So, let’s look at the pros and cons of ownership in plain English:


  • A tankless heater never runs out of hot water.
  • It will eventually save about 30% to 50% in energy costs over a tank system (minimum EF of .82 vs. .54 for conventional)
  • These devices are small, space-saving devices that hang on the wall and free up floor space.
  • It lives longer (expectancy 20 or more years) Almost double a traditional water heater’s life.


  • Initially, there is a lag time for the burners to get hot and calculate the flow rate.
  • Installation can be a hefty undertaking.
  • Special chemicals must be used to flush tankless systems (de-liming). This runs about $125.00 per year.
  • Hot water flow rate is limited by the size of the unit.

So, should you go tankless or stay with the tank?
Well, if you need an endless supply of water, take long showers, or need some huge, constant amount of instantaneous hot water, you should look at the tankless system. Just be aware that you may not be able to run too many faucets concurrently. The energy savings can really add up in the long term, too.

Storage water heaters (Tank-Type)

Most people think of the common storage-tank system described above when thinking about hot water heaters. These are the standard cylinder-shaped devices that are rather bulky and generally sit inside of a closet somewhere out of sight. Now, all of the different types of heaters offer benefits and drawbacks, such as:


  • Generally cost less than newer technology.
  • Has the option of solar, electric, or gas as power options.
  • With the right choice of capacity as well as thermostat tweaking, these systems can be rather cost-effective.
  • Repairs can generally be made one part at a time.


  • Obviously, storage tank heaters take up more space than newer, tankless heaters.
  • They can take a bit longer to heat up the water, especially after a power outage.
  • You will generally get a shorter life out of these traditional systems, and your electric bill will likely be a bit higher than with a tankless system.

Is it for you?
Traditional storage tank water heaters are great choices for those of us who cannot afford the cost of a tankless system. In fact, below I will be giving a review of a traditional tank system that runs about $300.00 brand new. Now, with that said, this is still a choice that you have to make. If you want lower up-front costs as a trade-off for a slightly higher electric bill; then the storage heater may be for you.

Hybrid Electric Heat-pump Water Heaters

Last, but not least, we will look at one of the newest technologies to enter the market — the hybrid heater. The EF rating of 2.0 and the highest “first-hour rating.” This newer technology is a very effective heating system, which works by using an installed heat pump as well as traditional heating elements. Chances are, you will not regret purchasing a hybrid, but there are also benefits as well as negative aspects associated with this type:


  • Because of the combination of technologies, you will not run out of hot water. Ever.
  • You will spend less on repairs versus either of the other two options.
  • Installation is pretty straightforward and maintenance is almost nonexistent.


  • These hybrid systems are slightly larger than a traditional system.
  • Being a new technology, you may end up spending more from the beginning.
  • You may be required to perform some minor plumbing changes.

Is it for you?

When it comes to the hybrid heater, there are more positives than negatives. Most of the drawbacks relate to space issues with the larger format; but if floor space is not an issue to you, purchasing a hybrid unit will make you a happy camper for some time to come!

Features to Consider When Buying a New Hot Water Heater

Okay, so many of those reading this are probably thinking, “Well, all of this is great to know, but I really just want to be able to figure out what the best system to buy for my household is.” Of course, I remember our hypothetical morning shower-taking individual who has been forced to shower at his neighbor’s home. This person probably does not want to spend much time thinking about the internal mechanics, but would rather make the best decision coupled with a decision that will allow him to get the new system installed so he can take his nice warm shower from here on out without trekking to the neighbors in a towel and a bundle of clothes tucked under his arm. Okay, you all got me there, so let’s get into the features that you should consider when making this purchase. Now, while it may not be something that most people think about on a normal basis, your best bet when buying a water heater is not to wait until your current system goes kaput, as in our hypothetical example above; but rather to plan ahead to make an upgrade or replacement to your aging system.

With that said, there are several factors which must be considered when replacing your unit. The most important factors can be summed up as follows:


This is probably the most important factor when determining whether to stick to a tank-style system or to switch over to a tankless system. If you do not have that much space, you will be limited in the capacity of the tank that you will be able to install. This will lead to the inability to take long showers without risking the chance of the water running cold. If you are faced with limited-space, you should consider switching to a tankless system, taking into consideration all of the other factors below.

Capacity & Size

This intertwines a bit with space, so I will not get redundant on capacity as it relates to space. However, let’s assume that you have just moved into a large three-bedroom home with two bathrooms and a basement; and it becomes time to replace your tank. Well, you may notice that you have an extra-large storage tank system with a hot water supply that has never ran cold on you. However, you may notice the next month that your first electric bill is extraordinarily high. Upon taking a look at the sticker on the tank, you note that the estimated electrical cost per month to own that tank is $175 per month. As a single person living in this home, you may want to consider decreasing the capacity of this tank, if the electricity cost is of concern to you. As such, take a look at the yellow stickers on the units before purchasing, as these will give you a good estimate related to what it costs to operate the unit you are thinking about purchasing. You may note that you can get away decreasing the capacity to a tank that slashes your electric bill by as much as 1/3 of the original cost. In this scenario, your best bet is to go with the smaller unit. It is important to remember here, though, that you do not want to risk it and go too small, as you may end up with a tank that runs out of water every time you shower; thus making your mornings miserable. Alternatively, you may want to consider a tankless system as well, although it may be best to wait that decision out another few years, when the technology has further developed. Who knows, the next time around, you may be able to get a fully-solar tankless system with the capability to heat enough water to run every faucet in your home at the same time. The rule of thumb here is to realize that technology decreases in price while concurrently increasing in function.


Power Source

Gas, electric, or solar. This is probably the most important decision you will make behind the device type itself, as described above. Part of this decision is going to be geographically influenced. If you have the option for either gas or electric (and solar is out of the picture), you will need to consider:

Power Type/Cost of Ownership

As mentioned above, this will be a consideration on the total cost to buy the specific type of device. Gas devices are cheaper, but electric-type power sourced systems are gradually becoming on-par. So, then you have to consider the next factor.

Total cost of ownership

This is where you are going to have to consider the ability to replace bad parts as well as the monthly expense incurred via your electric or your gas bill. The downside to gas heaters in this sense is that they use gas to heat the water combined with electricity to power the unit. This is a miniscule amount of electricity, but depending on where you live, it may end up costing you more to own a gas device because of this.


Last but not least, you have to consider functionality. What is the point of owning the best solar, tankless, tank-based, or even hybrid system if it does not function to meet the needs of your household. Take a good, hard look at your research for your prospective device. Do you know beyond a shadow of a doubt that it will provide you with the amount of hot water that you are going to require to meet the needs of your household? If the answer is “no” or even “maybe,” do not proceed any further with that device.

Who Make the Best Water Heater Brand

So, let’s get familiar with some of the top brands:

  • Kenmore: A solid brand that you can trust. They make water heaters that are gas and electric, as well as multiple sizes with Hydrosense temperature-control. They can be purchased at Sears.
  • AO Smith: They are a manufacturer of all types of water heaters; gas and electric; and they specialize in tankless, hybrid, solar, and tank-based systems. They are available only through plumbing wholesalers.
  • General Electric: Better known as GE, they make gas and electric heaters of multiple sizes and great energy efficiency. They are available only at Home Depot.
  • Rheem: Rheem products include gas and electric, tank and tankless heaters. They are also venturing into the solar market. Like GE, they are available at Home Depot and Amazon, but their tank systems can be purchased online as well.
  • Whirlpool: They have been around forever and make gas and electric heaters. They are available at Lowe’s.

Reviews of Current Top-Rated Hot Water Heaters

With all of this considered; what buying guide would be complete without reviews of some of the best-rated systems on the current market today? Which manufacturer produces the best heater? Well, that is going to depend not only on the heater, but on your specific needs. So, to determine this, let’s look at a brief review of some of the current heaters on the market. Without much fanfare, let’s jump right in. These reviews are taken, in part, from personal experience as well as from the very trusted consumer research source known as “Consumer Search,” which gives honest reviews on just about any and every consumer device known to many

Best Gas-Powered Hot Water Heater- Whirlpool 50T12-40DNG at Lowe’s

This gas-based system is rated by many different research sources as the best gas water heater that money can buy. From the trusted people at Whirlpool, this system comes with a whopping 12-year warranty. It also uses proprietary technology from Whirlpool to tweak the hot water performance to make use of every single bit of its 50-gallon capacity. It is rated to provide enough hot water to meet the needs of a family of 5 without a problem. Seriously consider this if you are looking into a gas heater and have a little bit of extra money to spend for a premium product.

Best “Affordable” Electric Water Heater- Whirlpool E40R6-45 at Lowe’s

This is an entry level, 40-gallon capacity, tight-budget, standard electrical offering from Whirlpool. This device is not Energy Star Qualified, but it meets all current standards for energy efficiency. Backed by a 6-year Whirlpool warranty, this machine is a great replacement for those seeking to replace an entry-level, no-frills, electric tank-based system without compromising on quality. This should provide enough water to meet the needs of a family of four without loss of heat.

Best Tankless Water Heater- The EcoSmart ECO27

The EcoSmart ECO 27 has some of the best reviews on the web in the household tankless system class of water heaters. It is a completely energy efficient design and should be able to simultaneously run four showers plus a dishwasher without loss of performance.

Electric vs. Gas Water Heater

To sum up the recommendations for electric versus gas or tank versus tankless, allow me to make a very brief observation: There are benefits and downsides to each type of system. Whether you choose electric or gas in your home is going to depend on a combination of your geographic location and your preferences and priorities. If you are looking for a low-cost, entry-level model; you can go with a $300+ electric system like the one reviewed above. While you may end up spending a little more per month in electric costs than if you purchased an Energy-Star compliant gas unit, these units are great for the consumer who does not have a large savings account with which to make these types of purchases. Overall, they are not terribly expensive to operate, although they will be a bit higher on a month-to-month basis. So, to sum that up:

Conclusion – The Bottom Line

So, in closing, let’s go back to the man with his emergency loss of hot water. Had he been aware of the age of his tank, along with the subtle signs that come with age and wear; he could’ve taken the steps necessary to research and replace his tank before the emergency happened. That is the point that I wish to convey to everyone reading this material. Just like maintaining the oil in the engine of a car, it is important to keep an eye out for issues with your hot water system. Also, like the engine in a car, when your tank starts to exhibit signs of failure, the best thing to do it to begin researching new systems. Take your time, if you have it, to take a look at the device style and power source that you wish to upgrade to. That way, you can prevent that awkward moment of standing half naked at your neighbor’s door asking to take your morning shower.

With that said – until next time, everyone!