By ShowMeStepByStepPublished
Based on a video by This Old House.
Storage tanks keep 40 or 50 gallons hot all day, even at 3am when nobody needs it. A tankless water heater skips the tank and heats water only when you open a tap. It hangs on the wall and frees up a big chunk of floor.
In this Ask This Old House project, plumbing and heating expert Richard Trethewey pulls an old gas tank out of a Milwaukee basement and mounts a high-efficiency Rinnai tankless unit in its place. You will follow the vent hole, the wall mount, the gas and water connections, and the red-and-blue isolation valves that let you flush the unit down the road.
This one involves gas piping and venting, so it is expert-level work best left to a licensed plumber. Installing a standard tank water heater instead? See our guide on how to install a water heater.
Start by shutting off the water and the gas to the old storage tank. Hook a drain hose to the tank valve and pump it empty so you are not fighting 40 gallons of water. Once it is drained, disconnect it and pull it out. That opens up the wall where the tankless unit will hang and gives you room to work.
Tip
Run the drain hose to a floor drain or utility sink. A small transfer pump empties the tank far faster than gravity.
Here is what makes a tankless unit different. Inside is a copper heat exchanger, a tight coil of tubing that the burner fires against. Cold water runs through the coil and comes out hot in seconds, only when you call for it. There is no tank sitting there reheating water all day. Richard shows the exchanger up close so you can see where the on-demand magic happens.
Tip
Hard water scales up the exchanger over time. That is why the isolation valves in a later step matter - they let you flush it clean.
Close the gas supply valve before you touch anything. A tankless unit fires much harder than a tank, so it burns a lot of gas in a short burst. That often means running a larger gas line from the meter to the heater. Sizing this wrong starves the burner. This is the part of the job that really wants a licensed pro on it.
Tip
Check the unit's BTU rating against your existing gas line size. Undersized pipe is the most common tankless install mistake.
A tankless heater vents differently than a tank. It pulls in fresh air and pushes out exhaust through PVC that runs to the outside. Using a hole saw, drill through the exterior wall near where the unit will hang. That single penetration carries both the intake and the exhaust pipe. Keep the hole clean and sealed so you do not let weather in.
Tip
Measure from inside and outside before you cut. Avoid wiring, studs, and any pipe hiding in the wall cavity.
The tankless unit hangs on the wall from a bracket, right over the vent hole you drilled. Hold it level and secure it to solid framing. This is where you really see the payoff - the whole heater takes up a fraction of the floor the old tank claimed. Get it plumb now, because the water and gas lines below all key off its position.
Tip
Anchor into studs or use heavy-duty masonry fasteners. A full unit has real weight once the water lines are charged.
Now tie in the plumbing. The cold supply and the hot outlet both connect to the unit through isolation service valves, the red and blue handled manifold under the heater. The gas line lands on its own port. Those isolation valves are not optional on a tankless. They let you close off the unit and flush the exchanger with descaler when it scales up. Wrap threads with thread-seal tape and snug every fitting.
Tip
Red handle is hot, blue is cold. Leave yourself hose-bib ports on the valves so future flushing is a five-minute job.
A tankless unit only heats when water moves, so the tap farthest from it can run cold for a while. Install a cross-over valve at that furthest fixture. It ties the hot and cold lines together so the unit's built-in recirculation pump can keep hot water waiting at the tap. You get hot water almost right away instead of standing there running the faucet.
Tip
Put the cross-over valve at the fixture with the longest pipe run from the heater. That is where the wait is worst.
Time to bring it to life. Open the cold water supply, turn the gas back on, and power up the unit. Open a hot tap and let it run. You should hear the burner fire and feel a steady stream of hot water within seconds, with no tank behind it. Check every joint for leaks while the system is under pressure before you call it done.
Tip
Watch the connections for a minute or two under full flow. A slow weep at a fitting shows up better once water is actually moving.
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