Just as the name implies, a conventional water heater has a holding tank. It usually holds forty to fifty gallons of water heated to the preferred temperature. A tankless water heater does not hold any water because it does not have a storage tank.

The tankless water heater turns on as needed at the time when there is a call for hot water. When you turn on the shower, your tankless water heater will start and heat the water to the needed degree. The tankless water heater will shut off once the shower has been turned off.

A tankless water heater does not have to keep the stored water hot at all times, so it uses less energy. A standard water heater uses energy when it is on standby, even when there is no demand for hot water. There is no standby heat loss while using a tankless water heater because it only runs when there is a call for hot water. Typically, in San Diego, you can expect 20%-30% energy savings when using a tankless vs. a conventional hot water heater.