Heating costs have risen steadily over the past few years. Both residential and commercial buildings can benefit from newer, more efficient water heaters. For building owners, knowing the types of water heaters available can be a major advantage.

In addition to conventional tank water heaters, consumers and businesses also have access to a growing range of tank and tankless water heaters — some that even use solar thermal collectors to heat water.

These are some valuable options for efficient water heating for a house or any type of building.

1. Conventional Storage Tank Water Heaters

The most common type of water heaters, storage tank heaters, utilize a large storage tank to provide readily available hot water to a home. The working principle of tank water heaters is likely familiar to most water infrastructure professionals.

The storage tank uses gas or electricity to heat water stored in the tank until it reaches a temperature set by a built-in thermostat. In an electric system, this heat is provided by heating elements. In a gas-powered system, a gas burner installed in the bottom of the tank provides heat.

These heaters provide a readily available reservoir of hot water for a home or building. However, they take up a great deal of space.

Stored water is also vulnerable to standby heat loss and will lose heat over time, requiring the heater to continuously use energy to maintain its reservoir of hot water. Water stored in a centralized heater may also be vulnerable to additional heat loss as the hot water travels in pipes from the tank to an outlet.

Despite their relatively low efficiency compared to other options, the simplicity and availability of storage tank heaters mean they remain a popular option.

These heaters can also sometimes be made more efficient with upgrades like improved tank insulation and high-efficiency burners or elements — though other styles of heater, like condensing tank or tankless heaters, are likely to be more efficient.

2. Condensing Storage Tank Water Heaters

Condensing water heaters are a high-efficiency variation on gas-powered storage tank heaters. These heaters feature a heat exchanger inside the tank that circulates flue gas from the sealed gas burner through the tank.

This flue gas circulation helps ensure the system uses the maximum amount of energy produced by the gas burner.

3. Tankless/On-Demand Water Heaters

Tankless water heaters eliminate the storage tank in favor of a heat exchanger coil that transfers heat from a heater to incoming building water. This heater may be an electric coil or a gas-powered burner.

A flow sensor detects when water is flowing through the heater, toggling it on and activating the heat exchanger coil.

These heaters are often called on-demand heaters because they heat water as it is demanded by the house rather than pre-heating and holding water at a high temperature for later use.

A home or building may use one tankless heater or several point-of-use heaters that provide hot water directly to a subsection of the building’s outlets. Point-of-use heaters reduce the travel time of hot water and can minimize heat loss that occurs as water travels from the heater to an outlet.

Benefits and Drawbacks of Tankless Heaters

By removing the storage tank, the tankless heater eliminates the possibility of standby heat loss, improving its energy efficiency over tank heaters. The loss of the tank also reduces the size of the heater significantly.

A tankless water heater can often fit into much smaller spaces than tank water heaters, making them a good fit for small homes or buildings with mechanical rooms that don’t have the space to fit a more conventional heater.

The small size of a tankless heater may limit its ability to provide hot water to a home. When purchasing a tankless heater, you will need to carefully consider factors like building size, outlet flow rate, and the number of building occupants when recommending a tankless heater.

By eliminating the storage tank, tankless heaters also eliminate the possibility for issues that can arise when heater tanks aren’t properly maintained — like tank rust contaminating a home’s hot water supply, tank leaks, excessive standby heat loss, and unusual water odor.

4. Indirect or Integrated Water Heaters

Indirect water heaters are similar to condensing storage tank heaters but rely on the main furnace or boiler of a home to provide heat to the tank heat exchanger, rather than an electric heater or an internal burner at the tank’s base.

These allow a building to use the same energy source twice for both space heating and water heating. In practice, the heater allows a building owner to recoup some of the energy produced when heating the home or building that may otherwise go to waste.

Like condensing storage tank heaters, indirect heaters are typically more efficient than conventional tank heaters and can sometimes be the least expensive option for residential or commercial buildings, according to the U.S. Department of Energy.

If a home or building already has a main furnace or boiler, these indirect or integrated heaters are a valuable option for maximizing efficiency and minimizing water heating costs.

5. Direct and Indirect Solar Water Heaters

Exterior solar panels can heat water directly or indirectly, providing an emissions-free and low-cost source of hot water to a home or building. These systems are often used as a complement to other solar technologies like home solar systems and batteries.

Direct (or open-loop) solar water heaters circulate water through solar thermal collectors and back into the home or building. These thermal collectors are similar to solar panels but do not collect solar radiation. Instead, they collect heat by directly gathering sunlight.

Thermal collectors are also sometimes used for supplemental space heating in both commercial and residential buildings. Thermal energy from sunlight heats the water as the system pumps it through the collectors. Heated water is typically stored in a tank for later use.

Indirect (or closed-loop) solar water heaters instead circulate antifreeze or a similar heat transfer fluid through the collectors. This fluid is circulated through a water storage tank, heating it to a set temperature in the same way as a conventional tank heater.

Direct systems are typically cheaper to design and install, though they may not provide enough heat for many homes. Because they circulate water directly to solar panels, which necessarily need to be outside the home, they may also be vulnerable to freezing or may become non-functional in the winter.

The indirect systems, which use a heat transfer fluid, aren’t as vulnerable to the cold. Like direct systems, however, the limited efficiency of solar heat collectors may mean they alone won’t be powerful enough to provide hot water for a home or building.

These Are the Best Options for a New Hot Water Heater

While conventional storage tank heaters remain common, homeowners or commercial building owners can review hot water heater specifications to find a model that will balance performance and energy costs.

Condensing and indirect tank heaters, for example, change how water is heated in the tank to make the process more efficient. Tankless heaters eliminate the tank altogether.

Solar water heaters are an innovative heating option that uses solar energy to heat water — though they may not be efficient enough for some buildings.

Author Bio: Emily Newton is the Editor-in-Chief of Revolutionized. She is a journalist who covers the innovations impacting the construction and industrial sectors.