Commercial Water Heaters

Upgrade Your Business with Commercial Water Heaters: More Hot Water, Less Waste

Commercial water heaters are an essential equipment for businesses and facilities with high hot water demands like hotels, hospitals, schools, and commercial kitchens. They provide large volumes of continuous hot water for sanitation, cleaning, food service, and other applications.

Unlike residential water heaters, commercial units are much larger, more durable, and designed for high usage, volume, and flow rates. The main types of commercial heaters include tankless, indirect tank, direct-fired tank, heat pump, solar, and electric resistance models. Each type has advantages and drawbacks based on hot water demand, energy source, peak usage times, and installation requirements.

Businesses must consider their unique needs in order to select the right commercial water heater. Factors like upfront cost, operating efficiency, maintenance, size requirements, and peak demand periods will dictate which type is most suitable. Proper sizing and installation is crucial to ensure sufficient hot water supply during high usage periods. Ongoing maintenance and monitoring can optimize efficiency and equipment lifespan.

Types of Commercial Water Heaters

There are 4 main types of commercial water heaters:

Tank Water Heaters

Tank water heaters store hot water in an insulated tank. They heat water using gas burners or electric heating elements. Tank water heaters provide a reliable supply of hot water and are lower cost, but they can be inefficient as they constantly heat water.

Tankless Water Heaters

Tankless water heaters, also called on-demand or instantaneous water heaters, heat water as it flows through the unit. They don’t store hot water. Tankless heaters provide hot water only when needed, avoiding standby losses. They can be more energy efficient but have higher upfront costs.

Hybrid Water Heaters

Hybrid water heaters combine tank and tankless technology. A tankless heating coil heats water only when needed, while a small storage tank provides a buffer to meet peak demand. Hybrids aim to provide the reliability of tank heaters with improved efficiency.

Heat Pump Water Heaters

Heat pump water heaters use electricity to move heat from the surrounding air to the water tank. This makes them 2-3 times more efficient than standard electric resistance heaters. Heat pumps work well in warm climates but decreased efficiency in colder temperatures.

Key Features and Benefits

When selecting a commercial water heater, there are several key features and benefits to consider:

Energy Efficiency

Energy efficiency should be a top priority, as it directly affects operating costs. Look for models with thick insulation and sealed combustion to prevent heat loss. Condensing water heaters recover heat from exhaust gases for added efficiency. High efficiency units like tankless or heat pump water heaters can reduce energy usage by 20-30%.

Recovery Rate

Recovery rate measures how quickly the heater can heat water to the set temperature. Faster recovery means less waiting time for hot water. Commercial heaters have much higher recovery rates than residential models. Make sure the recovery rate fits your facility’s peak demand.

Size and Capacity

Select a commercial heater with adequate capacity for your needs based on average and peak demand. Tank sizes generally range from 50-120 gallons for light commercial use up to 500+ gallons for large operations. Consult a sizing guide to pick the right capacity. Bigger isn’t always better – oversized units cycle on and off more, reducing efficiency.


Consider both upfront costs and long-term operating costs. While high efficiency heaters often have a higher initial price, the energy savings usually offset the difference in 2-5 years. Tankless heaters also save space. Perform a cost analysis to determine the best value.


Choose a unit that fits your available space and installation requirements. Commercial heaters are much larger than residential models. Make sure you have room for the tank, required clearance, and plumbing connections. Outdoor models require minimal indoor space but may need protection from weather.

Sizing Considerations

When selecting a commercial water heater, it’s crucial to consider the daily hot water requirements to choose the appropriate size. The main factors to evaluate are:

  • Daily hot water usage – Estimate the total gallons per day needed based on the number of people using hot water, dishwashing needs, laundry loads, showers/baths, etc. Keep a usage log for a few days to get accurate data.
  • Peak demand periods – Note times when hot water demand spikes, like meal times for restaurants or mornings/evenings in hotels. Size the heater to meet peak periods.
  • Number of fixtures – Count all fixtures using hot water like sinks, dishwashers, showers and base heater size on the probable simultaneous demand.
  • Incoming water temperature – Colder incoming water requires more energy to heat. If your location has colder water year-round, get a larger heater.

Properly sizing a commercial water heater is crucial for sufficient hot water supply during peak periods. Undersizing leads to running out of hot water while oversizing wastes energy and money. Consult a professional to determine the right size based on your usage data and demand.


Proper maintenance is crucial for commercial water heaters to operate efficiently and safely. Here are some key maintenance tasks:

Flushing and draining – This should be done annually to remove sediment that builds up in the tank. Turn off power to the heater, close the cold water supply valve and open the drain valve to flush out water and sediment. Once drained, close valves and refill.

Checking anodes – Most commercial heaters have magnesium or aluminum anodes that corrode sacrificially to protect the tank. These should be checked annually and replaced if over 50% corroded. This prevents tank corrosion.

Descaling heat exchangers – In tankless or heat pump water heaters, scale buildup on heat exchangers will reduce efficiency. A descaling solution can be circulated periodically to remove scale.

Checking pipes and fittings – Visually inspect all water connections and pipes for leaks, corrosion or damage. Check that temperature and pressure relief valves are functioning properly. Replace any faulty fittings.

Regular maintenance extends the life of commercial water heaters, improves efficiency and prevents unexpected failures or leaks. Following manufacturer guidelines for maintenance is highly recommended. Keeping maintenance logs is also beneficial.

Minimum Energy Efficiency Standards
Minimum Energy Efficiency Standards

Efficiency Standards

Efficiency standards and ratings help commercial businesses choose water heaters that align with energy regulations and environmental goals. There are a few key standards to be aware of:

  • The Department of Energy (DOE) sets minimum efficiency regulations for commercial water heaters under 10 gallons to 10,000 gallons. Gas-fired water heaters must meet thermal efficiency and standby loss requirements based on their storage volume. Electric water heaters have minimum energy factors based on first hour rating and storage volume.
  • ENERGY STAR certification indicates electric, gas, oil, and solar water heaters that exceed federal standards by at least 10%. Qualifying commercial heaters have better insulation, heat exchangers, and controls to improve efficiency. ENERGY STAR models can reduce energy costs by 10-50%.
  • Low NOx emissions standards limit the amount of nitrogen oxide (NOx) emissions, a contributor to smog and acid rain. California’s South Coast Air Quality Management District (SCAQMD) has strict NOx emissions regulations that manufacturers must meet. Look for SCAQMD-certified commercial water heaters in this region.

Choosing energy efficient models certified by DOE, ENERGY STAR, and SCAQMD helps commercial facilities adhere to regulations and operate sustainably. Consult with water heater suppliers to pick compliant, high-efficiency units for your specific application.


Proper installation of commercial water heaters is critical for safety and performance. Here are some key considerations:


The water heater should be located as close as possible to the points of use to minimize heat loss from the pipes. It should be installed indoors in a clean, dry area that won’t freeze. Make sure there is adequate room to access the unit for maintenance and repairs.


Gas-fired heaters require proper venting to safely remove combustion gases. The venting system must be sized appropriately and installed according to local building codes. The vent piping should be as short and straight as possible.

Gas and Water Connections

A licensed plumber should install the gas and water lines according to code. The gas lines must be sized properly for the BTU rating of the heater. Cold water lines should be installed to the inlet and hot water lines to the outlet per the manufacturer instructions. Shut-off valves should be installed for ease of service.

Electrical Connections

Electrical connections should be performed by a licensed electrician. The voltage, amperage, and phase must match the specifications of the unit. Conduit should be run from the electrical panel to the water heater. Grounding and bonding must be installed for safety.

Operating Costs

Operating a commercial water heater comes with ongoing costs that should be considered during selection and budgeting. The main costs to keep in mind are:

Energy Costs

The energy source for heating water, whether gas, electricity, oil, etc., represents a significant portion of the lifetime operating cost of a commercial water heater. When sizing and selecting the right model, be sure to look at the efficiency rating to estimate energy costs. More efficient models like condensing gas water heaters can provide significant long-term savings compared to standard models.

Maintenance Costs

Commercial water heaters require periodic maintenance like flushing, scale removal, anode rod replacement, leak checks, ventilation inspections, etc. The maintenance needs vary by type of water heater. Budgeting for preventive maintenance and any repairs over the lifespan is important.

Lifespan and Replacement Costs

The typical lifespan of a commercial water heater is 10-15 years. Eventually, the tank or components will need replacement. Factor in the price of a new replacement unit and installation labor costs for the future. Some types like tankless water heaters may have a longer lifespan of 20+ years which impacts lifetime costs.

Properly sizing a commercial water heater and selecting an energy-efficient model can help minimize operating expenses over the long run. Maintenance costs also add up over time. And eventually the unit will need replacement, so include future replacement in operating cost projections. Considering all these factors will help determine the best water heater option for your business’s budget.

Top Brands

When it comes to commercial water heaters, there are a few major brands that stand out in terms of quality, reliability, and performance.

A.O. Smith

A.O. Smith is one of the leading manufacturers of commercial water heaters. They offer a wide range of gas, electric, oil-fired, and tankless water heaters for commercial applications. A.O. Smith is known for their innovative features like advanced controls and water treatment solutions. Their ProLine products are designed specifically for commercial use.

Bradford White

Bradford White is another top brand in commercial water heaters. They manufacture high efficiency gas and electric models in a range of sizes. Bradford White heaters feature durable components and user-friendly controls. Their commercial line includes storage, instantaneous, and solar models.


Rheem is a recognized name in water heating, offering commercial gas, electric, tankless, and solar water heaters. Their ProTerra line provides high efficiency and reliability. Rheem commercial heaters have a focus on advanced electronics for optimal performance. They offer multi-unit rack systems for large facilities.

State Industries

State Industries produces gas and electric commercial water heaters in both standard and high efficiency models. Their Maxline heaters are designed for durability with stainless steel construction. State Industries offers multiple control options and accessories for customization.


Hubbell manufactures heavy duty commercial water heaters including electric, gas-fired, direct vent tankless, and indirect water heater models. Their heaters feature robust all-copper construction and industrial grade components. Hubbell offers advanced diagnostics for preventative maintenance. They provide custom sizing and configurations.

Commercial Water Heaters Conclusion

Choosing the right commercial water heater for your business is an important decision that requires careful consideration of your hot water needs, available space, energy costs, and maintenance requirements. Taking the time upfront to select the correctly sized and most efficient model will pay dividends down the road through lower operating costs and fewer unexpected breakdowns.

Some key points to keep in mind when selecting a new commercial water heater include:

  • Determine your peak hot water demand in gallons per hour to ensure the unit is large enough to handle maximum load periods
  • Consider tankless models for low or intermittent demand to save space and energy
  • Compare efficiency ratings and choose ENERGY STAR certified models when possible
  • Look for advanced user controls and diagnostics to simplify maintenance and repairs
  • Choose stainless steel or glass lined tanks for increased durability and longer service life
  • Install the water heater as close as possible to the point(s) of use to minimize heat loss in the pipes

Properly maintaining your commercial water heater with regular tune-ups and anode rod replacements will maximize its lifespan. Investing in a high quality, energy efficient unit combined with good maintenance practices will save substantially on operating costs over the years. Hot water is a necessity for any business, so putting in the work upfront to find the right commercial water heater will ensure reliable operation for staff and customers.

Curtis R. McNutt
Curtis has the mind and hands of a mechanical engineer. He pursued a college degree in engineering and worked in the medical field as an EMT prior to starting his plumbing career over 18 years ago. Known for his exceptional skill level and work ethics, Curtis has built a remarkable reputation within the trade as a trusted professional. He has amassed hundreds of five star reviews and positive testimonials over the years from his customers.

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