Tankless water heaters are rated by their ability to heat the water instantly and since they do not have a storage tank like the traditional water heaters one can really not speak from capacities. Therefore is no equivalent of a 40 gallon water heater in tankless units.
Traditional water heaters heat the water slowly in a storage tank and often are referred by the size of the storage tank. Once about 75 % of the water in the tank is used up it takes a long time for it to slowly heat the water again. Here we are limited by the capacity of the tank.
A tankless heater has no capacity. Its limitation is volume of water, or better its flow rate.
That is how many gallons of water per minute at a certain temperature can it deliver, and it will do this endlessly, sort of, as long as we have water and gas and electricity going to it.
Tankless water heaters are therefore sized by their flow rates, measured in gallons per minute, GPM. This flow rate is reduced the more the heater has to heat the water. Warmer water coming into the heater needs less heating resulting in higher flow rate and vice versa.
Some manufactures try to project their heaters with larger flow rates by assuming warmer incoming water and with it claiming theirs to be better. Tankless heaters don’t heat the water in absolute temperatures;
It will deliver the water at this temperature at a flow rate of 7.5 GPM. If the incoming water temperature decreases then the heater will deliver less GPM, not lower temperature water. So when a heater is sized too low for the demand needed then low flow rate becomes an issue.
Noritz for example changed their model numbers beginning of the year to reflect a higher flow rate by assuming warmer incoming water temperatures, somewhat deceiving. A unit that was called 751 last year, delivering 7.5 GPM at delta 45 is now labeled 98. It will deliver 9.8 GPM at delta 30, which is not realistic. An incoming water temperature is almost never 70 deg. F. The same heater delivers then only 6.7 GPM at delta 50 which is more reasonable.
So it is very important to have a good understanding of flow rate and delta F. As a reference a regular shower head has a flow rate of 2.5 GPM.
During winter the ground water tends to be cooler and the heater’s flow rate then decreases. Depending on lifestyle and number of people the unit should be seized to provide good flow rate with at least 20% margin to the upside. A reasonable hot water temperature setting is around 120 deg. F to account for some cold water mixing and the cool off through plumbing. Assuming a winter incoming water of 50 deg. F then a temperature rise of 70 deg F is needed. Here the above mentioned Noritz unit will deliver about 4.5 GPM. This is enough for a regular shower and kitchen sink but it is a far cry from the implied 9.8 GPM.
Most tankless units can be cascaded or run in parallel controlled by their electronics and deliver higher volumes of hot water. In commercial application many of them are cascaded to supply hotels, restaurants, spas and other applications.
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