We've made a few major decisions over the last couple of days, not the least of which is that neither of us really enjoys showering with a bucket of lukewarm water.

Since we were thrust into the potentially life impacting decision making process surrounding the replacement of our fractured water heater, we've had a bit of a crash course on the subject of 21st century water heating.

It seems the whole industry has progressed rather significantly since our doomed gas fed 40 gallon hot water tank was installed in 1995. It's amazing what nearly 19 years will do to technology of nearly any kind.

To be totally honest, I've actually been brainstorming and generally researching water heating solutions for our home for many years. Well, I should correct that statement. I've actually been daydreaming about the day we'd eventually replace our outdated and inefficient tank heater, and I often daydream via Internet research and mock shopping. I know, I have a set of ridiculously exciting daydreams.

When our original tank was installed, it was considered a moderately efficient unit for its time. But at about 80% efficient, today it's an embarrassingly inefficient dinosaur. An example of A bygone era of home appliances when lower technology, lower fuel prices, and lower consideration for the environment reigned supreme.

The old tank used an atmospheric vent by way of our second chimney flue, and it was positioned in an awkward location in our basement behind a terribly built temporary wall. To complicate matters, it was positioned beneath HVAC duct work, we were unable to service it or to even gain access to the anodized rod that should be periodically changed. How this thing lasted 19 years...I haven't a clue.

While I've long dreamed of replacing our existing configuration of forced air furnace and independent hot water heater with a high efficiency condensing boiler and indirect water heater setup, I've recently begun thinking this may not be the optimal setup for us in our home. Now, this unexpected tank rupture has us in a position where we need to make a decision once and for all on our approach.

The first thing we did was to take to the Internet and begin researching basic unit pricing. Knowing we wanted to replace our existing tank with a high efficiency natural gas unit that changes over to direct venting, we had a good starting point for pricing. Here's what we found.

• 50 gallon tank - $1,100
• Tankless - $1,500
• Boiler + Indirect Tank - $5,000

Now, this obviously isn't comparing apples to apples, but it gives a good idea of general unit pricing. Install obviously varies wildly based on gas line requirements, difficultly, individual rates, and complexity of the job, but it at least shows a rough comparison. It's also worth noting that the boiler option is far more geared to future benefit of using radiant heat in our home.

In weighing our options we started a pro and con list for each of the options, and that helped us to eliminate different pieces and prioritize our choice.

The biggest cons on the boiler option helped us to immediately eliminate that from contention. They were, cost and time to full implementation. We'd likely be looking at close to $15,000 on install of the boiler and indirect heater, and who knows how long it will take to realize the true benefit of radiant heat with out implementation timelines, so it was simply too large of an investment at this time. It also wasn't getting us anything more in the short term than a high efficiency tank would get us.

With the boiler option eliminated, we looked at our two remaining options, tank or tankless.

Tank Pros:

• Lower cost for new unit/install
• Proven to work in our house
• Higher GPM flow rate (determined by city pressure)
• Easier install
• Smaller gas line
• High efficiency units available

Tank Cons:

• Takes more space
• Runs out of hot water
• 7-10 year life expectancy

Tankless Pros:

• Never run out of hot water
• Smaller footprint
• Lower operating costs
• Longer life (20 years plus)

Tankless Cons:

• Lower GPM flow rate
• More expensive
• More complex install (larger gas line)
• Cold water sandwich (depends on unit installed)

While price is often a driving factor for many people, I feel that's often a knee jerk reaction based on immediate impact on the wallet, rather than looking at the long term effect operating costs have on price. It's obvious that a lower initial price is more attractive, but what does that get you?

In the case of tank vs tankless, a tankless water heater will cost less to operate since it only heats the water that's needed, rather than the way a tank keeps the whole volume of the water warm to you have hot water whenever you need it. However, the amount of time you'll need to realize this efficiency benefit vs cost of install may take you as much as 10 years, so should you really care?

The other consideration with cost is in regards to useful life. Since a tankless will last as much as two or three times longer than a tank heater, you might need to install two tanks in the amount of time you have with one tankless. But if you're not going to be in your house for more than five years, does it really matter. Since we'll be carried dead from our house, this is a factor for us.

So as important as price is, from this whole list of pros and cons, there are two items that really stand out to us that we're going to focus on, and they do not directly involve price.

The first is install footprint, which puts the tankless in the lead. Our house is small, and we eventually want to finish the basement, so the smaller our utility appliances the better. Hanging a tankless on the wall is a great way to free up space in our basement now, and a great way to allow for more space in a finished basement of our future.

The second item is flow rate, measured in gallons per minute. Tankless heaters must heat water to an agreed upon temperature before delivering that water, and it takes time and energy to heat that water. So a tankless heater will not have a consistent GPM flow every day because it will reduce its flow rate to ensure water is being delivered at temperate, rather than delivering cooler water (like a tank heater does).

This means that a tankless rated at 9 GPM will only deliver that true 9 GPM at 120 degrees when the input water temperature is 70 degrees in the summer. When that water temp drops to 50 in the winter, the tankless drops to maybe 6 GPM rather than 9 GPM.

I know even 6 GPM sounds like plenty, and it probably is, but we have one major consideration. We have those two massive 12" rain shower heads for our master bathroom shower. And these things expect as much as 5 GPM each. If both are on at the same time, we're talking 10 GPM.

Concerned about the capability to deliver the water we need, I did a little test experiment in the backyard with our garden hose and a five gallon bucket to ensure they can still run at a lower flow rate.

First I tested by filling the bucket and verified a 5 gallon per minute flow by adjusting the hose bib and how far open it was.

Next I hooked the rain shower head to the hose and was able to see the performance at 5 GPM, which was very nice.

Then I got distracted and watered the plants and herbs with this giant shower head for a bit.

Finally, I reduced flow at the hose bib to about 2.5-3 GPM, which is the lowest flow rate I can imagine with both shower heads on. While the flow wasn't ideal, it was still very acceptable. This told me that 6 GPM in the dead of winter mixed with some cold water split between two large rain shower heads will be more than sufficient.

So based on all of this information, we've decided to go the tankless route. We're working with Tankless Concepts, a local company with a great reputation (including recommendations from several of our readers), and I can't wait to fill you all in on the process next week. I told them that we run a blog and hope they don't mind that I'll be hovering over their installers the whole time to watch, learn, take photos, and possibly annoy.

We'll give you a whole recap next week and hopefully report back that we're enjoying our new tankless water heater. We'll be sure to cover everything from estimate to brand selection to install, and we'll hopefully answer any questions you might have.