Tankless vs. Tank Water Heaters in Colorado

Two different machines, not two sizes of one

A storage tank keeps 40 or 50 gallons hot around the clock and hands the whole reservoir over at once. A tankless unit keeps nothing hot. It fires a burner the second a tap opens, heats water as it moves through a heat exchanger, and shuts down when you stop. That is the entire difference. Every cost, every maintenance chore, and every disappointment on both sides traces back to it.

The upfront numbers do not compare the way people expect, because the two jobs are not the same job. A like-for-like tank replacement is one appliance and one visit, and the existing vent and gas branch usually carry over untouched. A first-time tankless conversion in an older house is closer to a small mechanical remodel: bigger gas pipe, a dedicated sealed vent, a condensate drain, a 120-volt outlet, and a wall that can hold eighty pounds of appliance. Along the Front Range that conversion commonly runs two to three times a straight tank swap once the gas and venting are counted, and the gap narrows sharply in newer construction that was roughed in for it.

Those spreads are market observations, gathered from watching what this corridor quotes. They are not a quote from us and they are not our own project data. As Denver.Plumbing accumulates completed jobs, we will publish figures from them and label them plainly as ours. Until then, treat any number on this page as a planning range and get three written bids.

So here is the comparison with the sales pitch stripped off both sides.

Altitude and a Colorado February rewrite the spec sheet

Thin air burns less fuel. Every gas appliance in this state gets derated for it, and the rule installers size by is roughly four percent off rated input for every thousand feet above two thousand. At Denver's 5,280 feet that is around an eighth of the sticker gone before anything else goes wrong, and it gets worse as you climb the corridor toward Monument. Manufacturers publish high-altitude models and conversion kits for exactly this reason. A sea-level unit bolted to a Colorado wall is not a bargain. It is a lukewarm January.

The bigger distortion is temperature rise. Flow ratings get quoted at a modest rise, often 35 or 45 degrees, because that is a flattering condition. A February shower is not a flattering condition. Colder incoming water means the burner does more work per gallon, and flow trades against rise close to one for one. A unit rated at seven gallons a minute at a 45-degree rise gives you somewhere near four and a half when the rise you actually need is 70. Nothing is broken when that happens. The physics just showed up.

Two line items do most of the mid-project surprising, and both are avoidable if the bid is honest. The first is gas. A 40-gallon tank burns somewhere near 40,000 BTU per hour, while a whole-house tankless unit wants 150,000 to 199,000 the instant somebody opens a tap. The half-inch branch feeding the old heater rarely carries that, so plan on three-quarter inch or larger running back toward the meter, and occasionally a conversation with the gas utility about the meter itself. The second is venting. The old tank drafted naturally up a B-vent it often shared with the furnace. A tankless unit is sealed combustion and needs its own dedicated run, usually out a sidewall, plus a condensate drain and often a neutralizer cartridge on condensing models.

Denver requires a permit for water heater work. Denver Community Planning and Development lists it as a quick permit for single-family and duplex homes, issued without plan review, with compliance determined by field inspection. On a straight swap that is close to a formality. On a conversion it is the whole point, because the inspector is looking at the new vent path, the gas sizing, and the condensate handling, not just the box on the wall. A bid that leaves the permit out is not cheaper, it is less complete, and our Denver permit guide covers what gets pulled and why.