RESIDENTIAL WATER HEATING

For 20 years Liquid Solar has been designing & installing innovative/efficient residential water heating systems.

CHOOSING AN EFFICIENT WATER HEATER

Many plumbers, builders, and architects default to the least efficient, lowest-cost water heaters—especially in older homes or new builds. But better options exist.

Below are smarter, high-efficiency choices for both new construction and existing homes.

🔍 Scroll to the bottom for a quick comparison chart of pros/cons.

NEW CONSTRUCTION

Designing a home from scratch gives you more options. Our top recommendations:

Heat Pump Water Heater

The most efficient choice—ideal for all-electric homes, and still a strong option even with gas or propane.

Electric Tankless

Good for small spaces, ADUs, or intermittent use.

Marathon Electric Tank + Solar PV

Great for homes with solar PV or all-electric systems. Long-lasting, super-insulated tanks.

Combo System (Heat Pump + Booster)

Great for homes with solar PV or all-electric systems. Long-lasting, super-insulated tanks.

High-Efficiency Gas Tankless

Best gas option. For homes with high-efficiency gas boilers, consider an indirect tank (a.k.a. water-maker).

Solar Hot Water (Thermal)

Best for high-demand homes or where heat pumps/solar PV aren’t feasible.

EXISTING HOMES

More constraints—but still efficient options. Your best choice depends on:

Fuel type, space, budget, performance needs, reliability, and availability.
Use the chart below to match your current system with the best upgrade.

💡 Tip: Don’t wait until your old water heater fails—plan ahead to keep all options open.

WATER HEATER COMPARISON CHART - CLICK IMAGE TO ENLARGE

EFFICIENT RESIDENTIAL WATER HEATERS

Heat Pump Water Heater

The most efficient choice—ideal for all-electric homes, and still a strong option even with gas or propane.

  • Pros

    • Uses 75% less energy than an electric water heater and 85% less than a gas water heater

    • Reliable, proven technology

    • Available in 50, 65 and 80 gallon sizes

    • Very D-I-Y friendly

    • May qualify for federal tax credits. City of Bozeman offers $500 tax credit.

    • Stiebel brand (our preferred) only requires 15 amp breaker; others 30 amps.

    Cons

    • Not a good choice in small closet or small space (need at least 50-100 square feet; unless ducted).

    • Not recommended for high hot water demand (although increasing storage volume/# tanks may work).

    • Older model were noisy; new ones much better (the new Rheem is only as 48 decibels).

    • Some plumbers will claim “they don’t work” (wrong) and will not want to install.

    • They are taller than a standard electric water heater of the same tank volume.

    • Installed cost: $2,500 to $4,000+ (not including tax credits). DIY source from Lowes for $1,500+

    • Preferred brand: Steibel-Eltron Accelera series; Bradford White  Aerotherm series are our current preferred. But all brands are constantly improving.

    • Other brands like AO Smith, LG, Rheem seem good too.

Marathon Electric Tank + Solar PV

Great for homes with solar PV or all-electric systems. Long-lasting, super-insulated tanks.

  • Pros

    • Basic electric water heaters are low cost and >95% efficient.

    • Add enough solar PV to cover usage of water heater and eliminate water heating costs.

    Cons

    • Uses 3-4 times as much energy as a heat pump water heater.

    • Standard 50-gallon electric tank is $500 (not including install) (30 amp breaker)

    • A MUCH better electric tank is the Marathon (by Rheem): they are non- metallic (will never corrode) and very well insulated: $1500 for a 50g and they have a “stubby” (low and wide) shown in pic above.

High-Efficiency Gas Tankless

The most efficient gas water heater if the high efficiency versions is chosen.

  • Pros

    • High hot water production if sized properly.

    • Efficient: 80% to 95% (depending on model chosen).

    • No standby energy loss from a tank.

    • Compact

    • Reliable and proven.

    • Many plumbers will install.

    Cons

    • Requires venting and gas lines (unlike electric)

    • If hard water requires annual maintenance or hard water treatment system.

    • Rinnai and Navian are two of the best brands. Rheem is good too.

    • The lowest cost ($800 online) are “non-condensing” and 80% efficient.

    • Condensing models cost >$1200 and are 95% efficient.

    • An installed high efficiency tankless may be $3k to $4k.

On-Demand (Tankless) Electric Water Heaters

The most compact water heaters. Recommended for new construction and retrofits. Rock solid.

  • Pros 

    • Very efficient (no storage of hot water)

    • Very compact

    • Can satisfy very high hot water demand situations if sized properly

    • Durable and long lasting if properly maintained (hard water is the concern)

    • D-I-Y friendly

    • Low unit cost (but need to consider electrical costs)

    Cons

    • Not good where water is very hard (or requires water softeners)

    • Some plumbers will claim “they don’t last” (we tend to disagree”)

    • Larger ones have high amperage requirements

    • Unit cost $450 to $800 (size dependent); Installed 2x that but depends on wiring costs.

    • Steibel-Eltron Tempra series (many sizes); also Bosch, Eco-Smart and Rheem.

    • Available on-line only or we can supply.

Wall Mounted Compact Tank Style Water Heaters (electric)

Very common in Europe where they will put several in a house and close to each point-of-use. But can be used as whole-house water heater where demand is low, or as a backup where water is pre-heated by solar or by an A2W heat pump. 

  • Pros 

    • Space efficient; 20 or 30 gallon tanks.

    • Wall-mounted; high on wall so they do not occupy floor space; connections are on bottom of water heater.

    • Only requires 15 amp breaker.

    • Easy to adjust dial for water temp from 80F (vacation mode) to 160F (so smaller tank has more capacity).

    Cons

    • Slow recovery rate once hot water is used up  (but still fine for small homes).

    • Most plumbers don’t know about them and not available locally.

    • Unit cost: $600

    • The only company that brings these in from Europe is Stiebel-Eltron 

    • PSH20 Plus is 20 gallons and the PSH30 Plus is 30 gallons.  

    • We can supply. Or online.

Solar Hot Water (a.k.a solar thermal or solar heating)

Versatile, work-horse of water heating that we love in the right situation.

  • Pros

    • High hot water production.

    • Can meet up to 70% of annual hot water demand.

    • Not net metered or tied to utility grid; not subject to utility monitoring! 

    • Reliable and long-lasting if well designed and installed.  

    • Great for off-grid homes.

    Cons

    • Requires some type of backup water heaters for cloudy days.

    • Installers hard to find (but can be D-I-Y friendly).

    • Installed: $6,000 to $10,000 + ; DIY: $2,500 to $5,000 +

    • We are dealers for Sun Earth and we believe they make the solar collectors, racking, and an excellent app-based solar control

    • We source Stiebel Eltron tanks as we have found they are long lasting, affordable, and well insulated