Hybrid vs Tankless Water Heater. Which is Better?

If you are actively shopping for a water heating solution for your home, you most likely have come across hybrid and tankless water heaters and you may be wondering which is better.

Without a doubt, hybrid and tankless water heaters are more energy efficient and cost effective than traditional tank water heaters. However, they vary in specific features and each has its pros and cons.

Tankless Water Heater

Both are suitable for the average household with up to 4 people. A hybrid water heater is a great option if you live in regions where the weather is hot or warm throughout the year but not cold. On the other hand, a tankless water heater works well in any weather.

This article will compare hybrid vs tankless water heaters regarding energy efficiency, price and cost of operation, hot water output efficiency, how water output volume, and ease of installation among other features. It will also discuss the benefits and drawbacks of hybrid vs tankless water heaters and the conditions under which one is a better option than the other.

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Hybrid vs Tankless Water Heater Pros and Cons

What is a hybrid water heater?

A hybrid water heater has both a water tank and a tankless heating unit. It works by using a heat converter to suck hot air from the surrounding environment and then using it to heat water. The heated water is stored in the water tank.


  • Has a hot water storage tank
  • Highly energy efficient in hot climates
  • Easy set up
  • Hot water flows out of the faucet instantly


  • Can only be powered by electricity
  • Takes up a lot of space

What is a tankless water heater?

As the name suggests, a tankless water heater does not have a hot water storage tank. Hot water is heated directly in the waterline as the demand for it arises.


  • Small, space-saving size
  • Wide range of powering options, including propane, gas, and electricity
  • Uses less water
  • Energy efficient


  • Not suitable if there is a high demand for hot water
  • High installation costs


This section compares hybrid vs tankless water heaters side-by -side in regards to their features and benefits.

Space utilization

Tankless water heaters use space more efficiently. Since they do not have a water tank, they are smaller (carry-on brief case size) than hybrid water heaters. Therefore, tankless water heaters are the best solution for installation in small spaces such as studio apartments. Hybrid water heaters should be installed in a spacious area that is climate controlled.

Hot water output efficiency

Since a hybrid water heater stores hot water in a tank, as soon as you open the faucet, the water flows instantly. On the other hand, a tankless heater does not have a hot water reservoir, therefore it has a 3-8 second delay to heat water. This means that if you have a tankless water heater, cold water will flow out of your faucet for a few seconds before hot water starts to comes in.

Ease of installation

A hybrid water heater is easier to install. Usually, it comes as a self-contained device that requires minimal plumbing alterations and expertise to install. Tankless water heaters require more intricate plumbing work and in some cases, you may need a total electrical upgrade or to install larger gas lines.

Energy efficiency

Both types of heating systems are energy efficient but their mechanism of energy efficiency differ. A tankless water heater is efficient because it does not have a hot water storage tank, while a hybrid water heater leverages on the surrounding warm temperatures to heat the water.

With the traditional tank water heater, the thermostat is set at a given temperature. The heating element heats the water up to a specific temperature. If the hot water is not used immediately, it loses heat with time. The heater once again heats the water to the pre-set temperature on the thermostat. This cycle keeps repeating itself and can use up too much energy.

Since the tankless heater heats water directly on the water line specifically when there is demand, no extra energy is used to keep the heated water at a predetermined temperature.

If you live in a fairly warm region throughout the year (40-90F), a hybrid water heater offers better energy efficiency. It leverages on the warm temperatures around to heat the water faster. If you live in a colder environment, a tankless heater is more efficient.

Price and operating costs

The price of water heaters varies greatly depending on the size and manufacturer.

The specifics of the energy costs will depend on the energy input requirements for a particular water heater regardless of whether it’s hybrid or tankless. It will also depend on the type of energy source and energy costs in your area.

Powering mechanism

Tankless water heaters can either be powered by propane, natural gas, or electricity. If you have both power sources set up, you are assured to have a hot water supply even if there is a blackout. Hybrid water heaters are electric powered and won’t work well with propane or natural gas.

Water use efficiency

A tankless water heater uses water more conservatively than a hybrid water heater. It does not have a storage tank that needs to be filled with water, unlike the hybrid water heater.

Hot water output volume

hand rotate temperature adjuster of water heater

While both types of water heaters effectively meet hot water demand for the average 4-person household, their operation mechanisms pose a challenge if the hot water demand is higher.

On average, the tankless water heater produces 2-5 gallons of hot water per minute. If you have a large family or you want operate multiple faucets, a dishwasher, and washing machine simultaneously, the tankless water heater will not be able to meet the high demand unless you install more than one unit.

Although a hybrid water heater has a water reservoir, when the water in the reservoir runs out, you will need to wait for the turnover time for it to replenish. How fast it heats a new batch of hot water will depend on the surrounding temperatures. The colder it is, the longer it will take and vice versa.

Related: Get hot water faster from a tankless water heater

Stand out features

A hybrid water heater stands out for its unique converter/heat pump operating mechanism and combining a storage tank and tankless unit. On the other hand, a tankless water heater stands out for its tankless design and small size.


The best option between hybrid vs tankless water heater is dependent on several factors, including water volume demand, the temperature range in your location, budget, installation space available, etc.

Use a tankless water heater if you:

  • Have limited water supply
  • Have a small space
  • Live in a region that is cold throughout the year
  • Already have reliable natural gas or propane supply to your house

Use a hybrid water heater if:

  • Want instant hot water output
  • Would like to DIY install the heater
  • Live in a region that is warm throughout the year
  • Don’t have gas or propane supply to your house

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