Consumer Reports pointed out in a recent article that the start date for the Department of Energy's new residential water heater standards is just around the corner. All water heaters sold and manufactured after April 16 will be new models that have been updated to achieve greater energy efficiency. The resource noted that these upgrades will have several repercussions for homeowners, including larger, more expensive water heater models. The size change, which will impact standard heaters by increasing their diameter by at least an inch, is expected to noticeably ramp up the cost for water heater replacement. Going tankless may be one of the few ways homeowners can avoid these upcharges considering that these changes are taking place across the industry.

Increase in efficiency comes with a price
The change in size will mean greater costs to account for more demanding labor and transportation will be passed onto consumers. Many homeowners installing new water heaters will face significantly greater costs if the size increase caused by new efficiency mandates makes the latest water heater models too large to fit in their home. Spaces designed for water heaters in current homes were based on old standards – fitting one of the new water heaters into these spaces, or elsewhere on on your property, may require serious home renovation. Alternatively, the Arizona Daily Star explained that homeowners may be forced to find an entirely new location to install their water heater.

Adjustments to the foundation, knocking out and rebuilding  walls and other adjustments to your home can be quite costly and could easily become more expensive than the actual water heater. In cases like these, the efficiency gains offered by the new water heaters seem minimal in comparison to the upfront costs one of the new water heater models could impress upon homeowners.

New best practices increase the chances of installation error
Potential extra costs associated with new water heater models go beyond the upfront costs. New technology is always rife with technical failures and performance complications – there's a good chance that homeowners investing in new water heater models released in 2015 will get to experience this phenomenon first hand. This will in turn force homeowners to reach out to their installer and request additional services.

Furthermore, plumbers and contractors are still inexperienced with repairing and installing the new models. This means that the likelihood of an installer making a mistake when replacing your water heater is at its highest just out of the gate. Those looking to avoid the water heater industry's prototype woes should consider investing in water heater models that will go unaffected by the Department of Energy's new standards.

New government-mandated efficiency standards will change the way you shop for water heaters.

Avoid the upcharges and remodeling by choosing a tankless heater
The right tankless model will offer a solution to all of the issues that might soon plague homeowners looking to upgrade their water heater. Tankless models are designed to be just a tenth of the size of current models, and will be comparatively smaller than models released later this year – this compact size makes it easy to install tankless water heaters anywhere in the home. In fact, homeowners may actually gain space back by replacing an aging standard model with a tankless upgrade.

Current high-end tankless models boast 99 percent thermal efficiency, meaning that these models were not required to go under any efficiency changes after April 16. Installers with years of experience putting tankless water heaters into homes will be able to leverage that knowledge while those installing traditional models will have to start from scratch.