Tankless water heaters operate based on bare wire heating technology. The unit is activated through the flow of water and bare wire heats the water instantly as it flows through the unit.
When a hot water faucet is turned on, a flow sensor in the heater detects that the water is moving and turns on a bank of heating elements or modules. The water passes over the heating modules, usually in series, and exits the heater at the desired temperature. Since tankless water heaters do the entire job of a conventional tank-type water heater in just seconds, they require very high powered heating elements. A collection of sensors and a microprocessor will control the output water temperature to ensure that a precise output temperature is maintained during operation. When the water is turned off, the unit turns off completely and consumes absolutely no power again until a hot water faucet is turned on.
The outlet temperature can be set through the control panel on the unit itself. The output temperature is determined by the following three factors :
1. Flow Rate of water into a unit (I/min)
2. Cold Water inlet temperature(°C)
3. Appliance output (kW)
Instant water heaters in India should not be confused with tankless water heaters – commonly known instant water heaters in India are nothing but small storage water heaters between 1-6 liters and they do not provide hot water instantly and consistently. The table below will show you the differences between storage and instant water heaters.
| Particulars | Tankless | Storage |
| Energy Efficient | Yes | No |
| Water Saving | Yes | No |
| Unlimited Water Supply | Yes | No |
| Space Saving | Yes | No |
| Time-Saving | Yes | No |
| Pricing | High Pricing, backed by significant Value | Lower Pricing, delivering little customer value |
- Tankless water heaters save energy vis storage due to more efficient usage and zero standby losses
- Heating only happens when the water is on energy is saved since no heating and reheating is happening even while the water is not being used.
- Energy consumption is based on delta t – temp desired/set less ambient temperature so excess heating does not happen
- Due to less salt deposition on its heating element the heating is more efficient compared to storage and hence less energy consumption is required