Installing a tankless water heater

When I purchased my current home in December I noted that the hot water heater was 13 years old and probably at the end of its useful life, though it was still working. I knew that the Federal tax credit of $300 for installing a tankless water heater was going to expire at the end of the year and the local gas company was offering a $350 credit as well.

When I looked into it further I found out that the local gas company would only pay if a "professional" company installed the water heater and the cost estimates for installation were ~$2000.00. With a little research I found out that the "professional" installer only had to have a Federal Tax ID to qualify as "professional". Well, I own an LLC with a Fed tax ID.....so I thought that I'd have my company (wink) install the heater. After all, I considered myself a jack of all trades!

I bought the 0.7 gpm model at Lowes for $999 with a 12 month no interest coupon. The instructions seemed easy enough. Removed the old tank and put up the new tank next to the same wall. Then I took my measurements for exhaust piping. My old tank had a powered vent with a side exhaust through a 4" PVC pipe. The tankless water heater requires inlet air from the outside (like a high efficiency furnace), so I figured I'd use the old exhaust PVC as the new inlet. When I went to buy the exhaust duct work I got a big surprise. Tankless water heaters put out a lot of moist air and require stainless steel exhaust ducting.

So I came home and relocated the heater to the exterior wall where I could still use the PVC piping from my old hot water tank. I then went out and bought lots of 3/4" copper piping and 1/2" black iron gas piping since I was about 20 feet from the old tank location. The instructions mentioned using 3/4" gas line but I figured that I must have enough gas pressure since the old heater used 1/2" and my huge furnace used only 1/2".

It took me about 6 hours to do all the soldering, installing the gas line, cutting a 5" hole through the wall for the new exhaust duct and then connecting it. I didn't have any leaks when I turned the water and gas on. I plugged the unit into the wall socket and turned the water on and it worked! Or so it seemed at first.

With our old 40 gallon hot water tank we hadn't been able to really use our jacuzzi tub yet, so we decided to try out the new tankless water heater that night. We turned the water on, got in the tub and about 10 minutes later the water turned cold!! So much for a hot bath that night. Over the next several days I tried to figure out what was wrong. Most of the time the heater worked OK but sometimes it would not light or go out. Also, when I turned the water on at high volume the whole tank would vibrate violently. The troubleshooting guide gave 4 possible solutions, none of which could be checked without specialized tools.

I sent an email to the manufacturer and they thought my problem was inadequate gas pressure. I had noticed that the problem seemed to occur when the furnace was running, so I decided to replace the 1/2" gas line with 3/4" line. Another $100 later I have a tankless water heater that works flawlessly.

Overall, I spent ~$1400 on the installation. Unfortunately, I lost so much money on my real estate last year that I paid no Federal taxes, so I didn't qualify for the Federal tax credit. Today I did receive the $350 rebate from the local gas company, so my net was ~$1050.

Hopefully, this unit will pay for itself. With 3 baths and 4 teenagers who think nothing of 1 hour showers I hope for some savings, although they may be tempted to take even longer showers now since cold water was the only reason they used to stop.

The only complaint I have is that the heater will not turn on until it senses water flow for 4 seconds. If someone takes a shower and shuts the water off, then you get in you will have hot water at first (lots of water in the pipes) but then the water will turn ice cold (our inlet water is only 35 degrees). The hot water comes back eventually, but it seems like a long time when you are caught in a cold shower.