Many Memphis homeowners switch to a tankless water heater, expecting a big drop in their energy bill, only to be disappointed when the numbers barely move. Others are planning an upgrade and want to make sure they really get an energy-efficient tankless heater, not just a new piece of equipment with the same old costs. If that sounds familiar, you are not alone.
Tankless units can be very efficient, but they are not magic. Local water quality, the way your plumbing is laid out, and even simple thermostat settings can quietly eat away at the savings you were promised. The good news is that most of these issues are fixable once you understand what is going on behind the scenes in your own home.
At Smith's Plumbing, Heating & Air, we have been installing and servicing tankless heaters in Memphis and the surrounding areas since 2010, under the leadership of a Tennessee and Mississippi Master Plumber. Our team sees the same efficiency problems pop up in Memphis homes week after week. In this guide, we share what actually affects tankless efficiency in our area, and what you can do to get more hot water for less energy.
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How Tankless Heaters Use Energy in a Memphis Home
A tankless water heater works very differently from the old tank you may have grown up with. Instead of keeping 40 or 50 gallons of water hot all day, it sits idle until you open a hot water tap. A flow sensor inside the unit detects water movement, the burner or heating elements turn on, and a heat exchanger quickly raises the temperature of water as it passes through. Once the tap is closed and flow drops, the unit shuts down and stops using energy.
This on demand design avoids the standby heat loss that comes from constantly reheating a tank, which is why a properly set up system can be an energy efficient tankless heater. However, the unit still has to work hard to raise the temperature of the incoming water to whatever set point you have chosen. In winter, groundwater feeding homes in the Memphis area is cooler than in summer, so the heater has a bigger temperature gap to overcome for the same hot shower. That extra temperature rise means more gas or electricity per minute of use.
Your plumbing layout also plays a bigger role than many people realize. Long pipe runs to distant bathrooms, a looped recirculation system, or fixtures that are far from the heater all affect how long the unit has to run before hot water reaches the tap. If hot water is used in many short bursts at the far end of the house, the tankless unit may turn on and off frequently, which can chip away at efficiency and add wear to components over time.
Because we have been working in Memphis homes for more than 14 years, we know how local floor plans, older retrofits, and additions can impact the way a tankless heater operates. When we install or service these systems, we look at more than just the heater itself. We evaluate how water moves through your home so your system can run closer to its true efficiency potential.
Temperature Settings That Protect Comfort and Efficiency
One of the simplest ways to get more from an energy efficient tankless heater is to dial in a smart temperature setting. Many Memphis homes see good performance and safety with a set point around 120 degrees Fahrenheit. At this level, most families find showers comfortable, scalding risk is reduced, and the heater does not have to work as hard as it would at higher settings.
Every degree above a reasonable setting means more energy use. If your unit is set to something like 140 degrees, it must raise the incoming water an extra 20 degrees compared to 120. You might end up mixing in more cold water at the tap to make it comfortable, which defeats the purpose of that high setting. You pay for that extra heating without feeling much benefit, especially if you are just cooling the water back down at the faucet.
We see many homeowners leave their tankless heater at factory default temperatures or match what they used with an old tank unit. Those defaults are not always ideal for a family’s actual needs. During service calls, our technicians often review the current temperature setting, discuss how the hot water feels at different fixtures, and adjust the set point to better match comfort and efficiency goals. Guidance from a Master Plumber, backed by real experience in Memphis homes, can make a noticeable difference here.
If you are unsure what your tankless heater is set to, checking the display or manual is a good first step. After a small adjustment, pay attention to shower comfort and how quickly hot water arrives. Small, thoughtful changes at the thermostat can lower the workload on the heater and help keep energy use under better control.
Why Memphis Water Quality Can Quietly Kill Efficiency
Even if your temperature is set just right, water quality can undermine an energy efficient tankless heater over time. Memphis and many surrounding areas deal with hard water, which means your water carries dissolved minerals such as calcium and magnesium. When water is heated inside the tankless heat exchanger, these minerals can fall out of solution and form scale on the internal surfaces.
You can think of scale as a thin layer of rock building up inside the heater coils. Water still passes over those coils, but the mineral layer acts like insulation. The burner or elements must work longer and harder to push the same amount of heat into the water. That extra work means more gas or electricity used for the same hot shower, and more stress on internal parts that were designed to transfer heat directly to water, not through a crust of minerals.
Homeowners often first notice scale problems as reduced hot water flow at multiple fixtures, fluctuating water temperature, or a tankless unit that seems louder than it used to be. Sometimes the heater may show error codes or shut down during long showers. In hard water areas like ours, these are strong signs that the unit needs flushing and descaling to restore performance and protect efficiency.
Most manufacturers recommend regular flushing for tankless heaters, often on a yearly basis, and hard water can justify even more frequent service. Our technicians arrive in fully stocked vans with the pumps, hoses, and cleaning solutions needed to perform a thorough flush and descaling in a single visit. After this service, many Memphis homeowners notice faster hot water delivery and smoother operation, both of which are tied to better efficiency and a healthier heater.
Usage Habits That Make Tankless Heaters Work Harder
The way you and your family use hot water has a direct impact on how efficient your tankless system can be. One common pattern we see is very frequent, very small hot water draws. For example, someone might turn on the hot tap for a few seconds to rinse hands multiple times an hour. Each time that happens, the flow sensor may call for the burner to start, only to shut off again almost immediately.
This frequent on-and-off pattern is often called short cycling. It can waste energy because the heater goes through its startup sequence, uses fuel to heat the exchanger, and then stops before that heat is fully used to warm water reaching you. Over time, these tiny wasted cycles add up and also put extra stress on the internal components that have to keep firing up and cooling down.
Dripping hot water faucets and small leaks in hot lines create a similar problem. Even a slow drip can maintain a tiny flow through the tankless heater, causing it to turn on more than necessary. A recirculation system that runs all day without a timer can also reduce overall efficiency, because the heater may keep reheating the same loop of water even when nobody is using it. The system might feel very convenient, but that convenience comes with an energy cost if it is not controlled.
We often help homeowners spot these patterns during service visits. Simple changes, such as fixing hot side drips quickly, grouping certain hot water tasks, or adding a timer or smart control to a recirculation pump, can make the heater’s runtime better match real needs. These are practical, low-stress adjustments that help your energy efficient tankless heater live up to its name.
Installation Details That Make Or Break Efficiency
Even the best tankless unit will struggle to be efficient if it was not installed correctly for your home. Sizing is one of the biggest factors. A tankless heater must be sized for both the total flow of hot water you may use at one time and the temperature rise needed from your local incoming water. An undersized unit can run flat out whenever more than one shower or appliance is on, which can hurt both comfort and efficiency.
On the other hand, a heater that is much larger than your household ever needs may cost more upfront and still short cycle when only small draws are common. Getting the size right for your family’s habits is a balance. This is where real world experience in local homes is valuable, because paper sizing charts do not always match how people actually use hot water day to day in an older Memphis house, a renovated bungalow, or a newer build.
Gas line size and venting are also crucial. If the gas supply to a larger tankless unit is undersized, the heater may not be able to reach its full output cleanly or may struggle during peak demand. Improper venting and condensate handling can affect how cleanly the unit burns fuel and how long it lasts. Over the years, we have seen many Memphis installations where the tankless unit was added to an older gas system without enough evaluation, which left the heater starved for fuel and limited its efficiency.
Smith's Plumbing, Heating & Air has been installing and correcting tankless setups in Memphis for more than 14 years. Under Master Plumber leadership, our team checks sizing, gas supply, vent routing, and plumbing layout during new installations and when we are called in to diagnose efficiency complaints. A careful installation or retrofit lays the foundation for an energy efficient tankless heater that performs well for many years.
Simple Maintenance Routine for an Energy-Efficient Tankless Heater
Keeping a tankless heater efficient is not complicated, but it does require a bit of routine care. At a minimum, homeowners should know how to clean any accessible inlet screens or filters that catch debris before it enters the heat exchanger. Checking these screens every few months can help maintain flow and protect internal parts, especially if your home occasionally sees sediment in the water supply.
Flushing and descaling the unit on a regular schedule is just as important. In hard water areas around Memphis, many homes benefit from an annual flush, and some high use systems may need attention even more often. This process involves circulating a cleaning solution through the heat exchanger to dissolve mineral buildup. Once the scale is removed, the heater can transfer heat more effectively again, which means it uses less energy to produce the same hot water.
There are parts of tankless maintenance that make sense for a homeowner to handle, and others that are better left to a licensed plumber. While some owners are comfortable connecting hoses and pumps for a full flush, many prefer to have a professional handle it along with safety checks on the gas connections, venting, and internal components. During a tankless tune up, our technicians typically inspect for inspection for leaks, clear filters, flush the system, check temperature settings, and confirm that the unit is venting and draining correctly.
We follow an upfront pricing approach for this work, so you know the cost before we start. Our team also takes the time to explain each step and what we found, so you understand how the visit supports better efficiency and longer equipment life. This kind of routine, transparent maintenance keeps your energy efficient tankless heater closer to its original performance instead of slowly drifting into higher energy use and surprise breakdowns.
When To Call a Memphis Plumber About Tankless Efficiency
Some tankless performance issues can be improved with simple changes in habits or temperature settings. Other times, the signs point to a deeper problem that calls for a professional eye. If you notice sudden spikes in your energy bill, hot water that swings from very hot to cold during the same shower, or a heater that starts showing error codes, those are good reasons to schedule a visit.
Visible rust near the unit, water pooling around connections, or a vent pipe that looks out of place or corroded are also red flags. These issues can affect both safety and efficiency. In older homes that inherited a tankless heater from a previous owner, it is common to find that the unit has never been flushed, or that the original installation did not fully match the home’s needs and hot water habits.
In those situations, a thorough inspection and efficiency evaluation from a licensed plumber can save a lot of guesswork. When we come to a Memphis home for tankless concerns, we look at the whole picture. That includes how the system is sized, how the gas line and venting are set up, how hard the water is, what the current settings are, and how your family actually uses hot water. From there, we can recommend maintenance, adjustments, or in some cases an upgrade path if the existing unit is at the end of its useful life.
Smith's Plumbing, Heating & Air is available 24 hours a day for urgent hot water problems, and we have earned a strong local reputation with thousands of reviews and an A+ rating from the BBB. For larger projects, such as replacing a failing tankless heater or correcting a poor installation, we offer financing options to help spread out the cost. Our goal is to give you clear information and practical options, so you can move forward with confidence.
Get More From Your Tankless Heater With Local Memphis Pros
A tankless water heater can be a smart way to cut energy waste, but real efficiency depends on more than the label on the box. In Memphis homes, the combination of hard water, seasonal temperature changes, plumbing layout, and family habits all shape how well your system performs. With the right settings, routine maintenance, and a sound installation, your heater can deliver steady comfort while using less energy over time.