Condensing VS Non Condensing Tankless Water Heater

Tankless water heaters bring many benefits- with higher efficiency and smaller size being only some of them. However, exchanging the traditional water heater with a new one isn’t an easy task. Choosing between condensing vs non condensing tankless water heaters might be the biggest choice you have to make during this transition.

Although both are more efficient than electric ones, there are still some differences to consider when buying.

To clear up – first, let’s shortly mention the main difference between the traditional water tank and the tankless water heaters.

The traditional water tank holds up to fifty gallons of water in a huge tank. This tank is a place where the water is held and heated.

However, with the tankless water heaters, the water is heated as it flows through the heat exchanger. This means that the water isn’t stored, which saves up a bunch of space that traditional tanks used to occupy!

What is a non condensing tankless water heater?


The tankless water heaters use fuel, which produces a lot of steam as a result. The non condensing ones vent this steam through different channels.

These channels need to be resistant to corrosion and heat, as exhaust gases can be up to approximately 300 degrees Fahrenheit. This also cools down the outside of the unit.

The non condensing tankless water heaters usually have only one heat exchanger. They are the most common type of tankless heaters, as they can use the existing house ventilation.

Although very popular, their main downside is that the excess heat is being exhausted in the open and not used. The efficiency level of non condensing tankless water heaters is therefore 80%, with 20% being wasted through this process of venting.

The other downside is that special venting material needs to be used in order to withstand the heat. This material can be quite costly. [1]

Other than that, they instantly give off hot water and save a lot of space as they are smaller. This, combined with the usage of the existing ventilation system, makes them a perfect transition from a traditional water tank.

Difference Between Condensing VS Non Condensing Tankless Water Heater 


Contrary to the non condensing ones, the condensing water heaters reuse excess heat. In other words, the condensing heaters recycle the exhaust heat through the venting system in non condensing heaters. This means higher efficiency for condensing heaters.

They do so by having an additional heat exchanger. This second heat exchanger is designed to loop back the unused heat and use it again – until it’s no longer useful. This is also known as the closed system.

The condensing water heaters still need to exhaust the excess gases, only the much cooler ones and in smaller doses. Therefore, the venting system doesn’t have to be as resistant to high temperatures, as with non condensing ones.

A standard PVC pipe works just as well for the ventilation system for the excess gases in this case.  This is because the condensing gases are not as hot – they get up to about 100 degrees Fahrenheit.[2]

In this case, the cooling happens inside the unit. Cooling of the exhaust gases results in condensation, which happens on the inside of the unit as well.

The water from the condensation has to be neutralized before being drained, which is done by special filtration for this process.

Since the condensing tankless water heaters reuse excess heat, their efficiency is higher. They outperform the non condensing ones, as their efficiency level goes from 90%, up to even 98%.

There are many pros & cons of tankless water heaters in general. However, it might be just as beneficial to summarize the pros & cons of condensing vs. non condensing ones.

More Deeper Comparison


Non condensing tankless water heaters 

Rinnai RL94iP Tankless Hot Water Heater,...
  • Original Design: Tankless hot water heater's...
  • Never Run Out of Hot Water with this Compact...
  • Smart, Durable Design: Includes 12-, 5-, and...


  • Cheaper option
  • Make use of existing ventilation systems
  • Smaller in size
  • Instant access to warm water
  • Energy efficiency up to 80%
  • Constant availability of warm water
  • Long Warranty


  • The 20% of unused energy
  • Very high temperatures of exhaust gases
  • Special stainless steel vents for withstanding this heat (costly)
  • high initial cost
  • Potential leaks (due to high heat of exhaust gases)
  • Usually costs more when converting from a big traditional tank


Condensing tankless water heaters

Rinnai RU160iN Condensing Tankless Hot...
  • Endless Hot Water: Our tankless hot water...
  • Energy and Space Efficient: The tankless...
  • Optimal Water Pressure: With a hot water flow...



  • The effectiveness of up to 98%
  • Saves up heating and fuel costs
  • Cheaper ventilation system  (PVC pipes)
  • Better for the environment (exhausts less toxic fuels)
  • Instant warm water
  • Constant availability of warm water
  • Long warranty




  • Usually more expensive (due to the second heat exchanger)
  • Possible corrosion inside the unit (due to inside condensation)
  • May require extra maintenance


When you have the pros & cons of a condensing vs non condensing tankless water heater, it’s easier to spot the difference.

As you may notice, your choice will largely depend on your budget, as well as on your current water heating systems. Keep in mind that both types have higher initial costs than the traditional water tanks.

As the traditional one, the tankless water heater can require maintenance and/or repair. Some of the most common problems with tankless water heaters are:

Among these, it can take quite some time to make up for the initial higher cost.

Which One To Buy? 


Investing in bathroom appliances with a long lifespan, while also saving up some space and reducing bills is worth it! These are the reasons why more and more homeowners are considering purchasing them.

Buy it if you want more space in your bathroom and are ready to invest in a more efficient heater.

However, you should keep in mind that both types of tankless heaters are not perfect. They will most likely require some maintenance along the way.

Choosing a non condensing one, or a condensing one comes down to your own budget and personal preference.

The non condensing heater can cost less, but be aware of the additional installation needed for the proper venting system. Also, be aware of the excess heat not being used to heat the water (the previously mentioned 20%).

The condensing heater is more efficient but can be more costly. Be aware of the additional repair needed, as these can cost you more due to the more complicated system used.

Also, if you have the option to choose the inside material of the condensing heater, choose the non-corrosive material. This can ensure that corrosion won’t happen inside of the unit due to the condensation.

The Bottom Line 

Deciding between a condensing vs noncondensing tankless water heater shouldn’t be a hard task. Either one you choose, you most likely won’t regret it. They are 100% worth it.

Most people choose non condensing tankless heaters due to having an existing ventilation system that supports them. However, both are efficient, with the condensing heaters being slightly more efficient due to reusing the heat.

The lifespan of both types of tankless heaters can surpass 20 years, and the initial high cost pays off over time. We hope this article has helped you make the right choice for your situation.