A.O.Smith's Innovative Hybrid Tankless-Storage Water Heater

North America's largest water heater manufacturer, A.O. Smith, is shaking up the water heating industry with its NEXT Hybrid gas-fired water heater that combines key features of both tankless and storage water heating technology.

About storage water heaters

As a refresher, storage water heaters have relatively small burners (in the case of gas-fired models) and large, insulated storage tanks. The water is heated gradually and stored in the insulated tank until needed. The advantage is that the burner can be small, keeping the gas supply pipe small and the air supply and venting needs relatively low. The downside is that there's a lot of surface area in the tank that is losing heat all the time (standby losses), and you can run out of hot water if several people are showering at the same time or a cloth washer is being used while someone is showering (though this is less of a problem with today's low-flow fixtures). It can take an hour or more to re-heat the tank after it's been depleted.

About tankless gas water heaters

Tankless water heaters use burners and heat exchangers to heat water as it is used. They provide a continuous supply of hot water and do not have stand-by losses. As long as there is electronic ignition rather than a standing pilot light, these water heaters have considerably higher overall efficiency than most storage-type water heaters. These water heaters are also compact in size. Whole-house models are typically gas-fired, because electric models large enough to serve whole-house needs require extremely high amperage. (Small point-of-use electric models are fairly common, though, for lavatory sinks.)

Tankless water heaters also have a few drawbacks. All but the largest tankless water heaters may not provide adequate hot water when more than one shower is being used or a clothes washer and shower are being used at the same time. Very small hot-water flows (less than about a half-gallon per minute) may fail to activate the burner; this is a problem, especially, when water-efficient faucets are installed. Models with large enough burners to adequately serve a whole house (it is not uncommon for tankless water heaters deliver 200,000 Btu/hour, and some have even higher output) require 3/4-inch or even 1" gas lines (compared with the standard half-inch lines); they also have large air-supply requirements and venting needs. Finally, tankless water heaters sometimes deliver a burst of cold water when there have been intermittent uses--referred to as a "cold-water sandwich."

Introducing a "hybrid" water heater

Enter A.O. Smith's NEXT Hybrid gas water heater. The unit has a relatively small "buffer tank" that delivers hot water right away when the hot-water tap is turned on and buffers water so that users won't ever get the aforementioned cold-water sandwich. This also allows the burner to not have to fire with relatively small hot water uses, such as washing hands in a bathroom sink. The company doesn't publish the size of this tank, according to David Chisolm, the manager of brand marketing for A.O. Smith's water heaters, because it doesn't want consumers to compare this water heater to a storage water heater (in which the storage tank is an indicator of how long one can shower before "running out of hot water"). The tank is believed to be 15 to 20 gallons in size.

Condensing technology helps the NEXT Hybrid achieve very high efficiency--it is rated at 90% "thermal efficiency." The high efficiency is achieved through a process in which a secondary heat exchanger is used to capture the heated flue gas from the tankless unit and route it back through the buffer tank to extract additional heat. So, not only does the buffer tank have benefits in terms of hot water delivery, but it also helps the NEXT Hybrid achieve it high-efficiency, condensing performance.

Energy Factor vs. Thermal Efficiency

Through a quirk in the laws governing water heaters, A.O. Smith is not permitted to report performance using an Energy Factor, which is the standard metric for energy performance of residential water heaters. If a water heater has a burner over 75,000 Btu/hour and less than two gallons of storage, it is defined as a "commercial" water heater, and energy performance has to be reported as "thermal efficiency" rather than Energy Factor. The NEXT Hybrid has a 100,000 Btu/hour burner. "It's a finable offense to issue an Energy Factor on a commercial product," Chisolm told me. He adds that the U.S. Department of Energy is aware of this problem with water heater ratings and is working on a fix; he believes that DOE will move away from Energy Factor ratings towards "thermal efficiency" ratings. "It's a much cleaner, scientific measure," according to Chisolm.

Unlike true tankless water heaters, the NEXT Hybrid water heater does have standby losses--estimated at somewhat over 300 Btu/hour, according to a technical service expert we spoke with at A.O. Smith. I would have liked to have seen better insulation around the tank (R-16 is used, according to the company), but Chisolm told me the standby losses amount to "just pennies a day," or about $40 per year. The first-hour rating, a standardized measure of how much hot water can be supplied per hour (starting with a tank of hot water) is 189 gallons.

The NEXT Hybird is being introduced this month in a natural-gas model. A propane model will become available in early 2011. The product was to be shipping by now, but the factory producing the units was damaged by the 500-year flood in Nashville, Tennessee earlier this year, according to Chisolm. It is in production now, however, and should be shipping to distributors in the next few weeks.

Like all A.O. Smith products, the NEXT Hybrid will be distributed through conventional plumbing and gas-equipment distribution channels.

Expensive--but cheaper installation

Pricing is set by dealers and distributors, but Chisolm expects the cost to end-users to be "in the $1,800 range," not including installation. This is somewhat more expensive than tankless water heaters, which range from about $1,000 to $1,500 for whole-house, electronic-ignition models. Significant savings can b realized over tankless water heaters, however, says Chisolm. Because of the condensing technology and low flue temperatures (100 – 150 F), inexpensive PVC venting can be used, rather than stainless steel, and it may not be necessary to install larger-diameter gas-supply lines, as is often necessary when installing a whole-house tankless water heater (though A.O. Smith does recommend 3/4-inch gas supply lines for this water heater).

Chisolm estimates an installation cost of $800 to $1,000, compared to over $2,500 for whole-house tankless water heaters. So, despite the higher sticker price, the over all cost when replacing conventional water heaters should be lower than with tankless models. Through the end of 2010, the product is eligible for a $1,500 tax credit (assuming that other energy improvements have not used up this credit).

The NEXT Hybrid water heater is one of a handful of exciting energy-saving water heaters recently introduced by A.O. Smith. Others include the Voltex heat pump model, the Effex and Vertex high-efficiency gas models, and the Cirrex solar water heater.

For more information:

A.O. Smith Corporation

Milwaukee, Wisconsin

www.hotwater.com

I invite you to share comments on this blog. What's your experience with tankless water heaters. Do you think the features of the NEXT Hybrid will prove popular?

Alex Wilson is the executive editor of Environmental Building News and founder of BuildingGreen, LLC. To keep up with his latest articles and musings, you can sign up for his Twitter feeds.

Photos: A.O. Smith Corp.

See more on this product in the GreenSpec Guide