Conversion to Tankless Water Heating Cuts Gas Costs at Florida Nursing Facility By 70%

Six manifolded Rheem tankless units offer more reliable service at lower cost for heavy-duty laundry and kitchen applications, while creating extra storage space where three commercial tank heaters had been installed.

After four years of lackluster service, two of the three 100-gallon tank-type commercial water heaters supplying the busy kitchen and laundry at the West Melbourne Health and Rehabilitation Center began to fail. Facility maintenance director Paul Brezina was not at all sorry to see them go down. In fact, he jumped at the opportunity to upgrade the nursing facility’s hot-water supply by converting from tank to tankless technology.

“I suggested that we convert,” Brezina says, noting that he was confident tankless would provide continuous hot water at the right temperatures inexpensively. “I was once a pipe fitter and had installed tankless water heaters myself, so I knew they were good. With the tank-type heaters, we were never satisfied with the hot-water supply. The kitchen dishwasher needs 142°F, but the best we could get was 138°F.”

The 180-bed nursing facility in central Florida runs its laundry and kitchen around the clock. Two 75-pound washing machines operate from 5:00 a.m. to 11:30 p.m., while the kitchen requires hot water for three meals a day with two multi-bay sinks and a dishwasher. Even when fully functional, the three tank heaters just couldn’t handle this punishing load.

“Everyone was on board with the idea,” says Brezina. Not only were two of the units failing, but tankless also offered other clear advantages for this application.

“The tankless heaters are smaller, taking up hardly any room,” he continues. “By connecting them together, if something goes wrong with one, I can shut it down and bypass it, so we’ll still have hot water. In contrast, if one of our old tank units ever needed servicing, all the equipment it served had to go without hot water.”

Contractor concerned: Brezina also opted to change to the Rheem brand, in part because of the company’s technical support. He called local Rheem installer Sun Plumbing in nearby Melbourne, Fla., to schedule the installation. Service manager Paul Webb was intrigued by the project, but also a bit unsure.

“I wasn’t really keen about the switch to tankless at first,” Webb admits. “It was my first experience with a tankless commercial application, and I was concerned about meeting health inspections with regard to temperatures. I’d been doing work for the center for over 10 years, and I wanted to nail it. We like to keep our customers satisfied with Sun Plumbing.”

To help with the project, Webb relied on the technical support offered by Rheem sales agent David Harris of the Spirit Group in Orlando and Rick Kise of the Gorman Company, Rheem’s distributor in Melbourne. “The owner of Sun Plumbing initially didn’t have a lot of faith in tankless,” Harris explains, “but he allowed Paul to do this because the customer really wanted to go to tankless.”

With round-the-clock hot water demand and high-temperature needs to meet health code, it was a complicated application that had to be “just right.” Assisted by Harris, Webb calculated the flow rate to supply both the commercial washing machines and the kitchen sinks and dishwasher, all of which are used simultaneously.

Webb also verified the building had two-inch water service, and he coordinated with city officials for the gas inspection. Six Rheem GT-199PVN-1 tankless units were installed in a manifolded (connected) configuration, supplying adequate hot water to both the kitchen and laundry areas. “Paul really did his homework,” Harris comments. “He spent a lot of time on preparations — making sure he sized the pipe and fittings correctly to deliver the right amount of hot water to his customer. All that preparation, in turn, made the installation fast, simple and efficient.”

Originally, the customer wanted to put all six tankless units on the roof to save on venting costs, but Sun’s crew ultimately installed them in the 12-foot x 8-foot mechanical room that previously housed the three tank heaters. “We had to core-drill through the facility’s concrete roof to get our vents through,” Webb says, “but the customer was happy with the final result.”

Staying in hot water: Both Webb and the center were concerned about maintaining a hot-water supply throughout the conversion to tankless. Consequently, Webb planned the installation around the facility’s slowest time of day. His crew of two plumbers and one helper kept one of the tank units operating while mounting the tankless models on the back wall of the room. Over the two-day conversion, the facility was without hot water for only four hours each day.  

“It was some of the best planning I have experienced on a job,” Harris remarks. “It went off like Paul had been doing this kind of work every day.”

Adds Webb: “It was just unreal how quick everything went together. I call over there two or three times a month to see how they’re doing, but they haven’t had any problems. The system is operating perfectly!”

“The kitchen loves that they have hot water all the time now,” says maintenance director Brezina, itemizing all the improvements. “The laundry used to have a problem satisfying hot-water needs, but no longer. The washers fill in time with no pressure problems.”

Dramatic cost savings: Brezina has also been comparing the fuel costs since the Rheem installation. In February, March and April 2008, the center’s gas bills were $4,100, $3,700 and $3,900, respectively — $11,700 total. Fast-forward to 2009, following the conversion to tankless, and the charges for February, March and April were $1,500, $700, and $1,350, respectively — $3,550 total. That calculates into a year-on-year savings of $8,150, or nearly 70%.

Total cost for the job was $26,426, which included the flue and other piping. But with the savings already achieved to date, Brezina figures to recoup that expense quickly: “Tankless heaters cost more at the front end, but at this rate, ours will probably pay for themselves within a year.”  

Here’s a second perspective on the payback: Had the facility opted to simply replace the three tank-type heaters, the cost would have still been around $18,000, or $8,426 less than the tankless cost. That means the facility’s gas-bill savings through April were already only $276 shy of covering the tankless premium. At this rate, the entire system will have paid for itself in energy savings — and then some — well before the end of the first year of service.

Meanwhile, the center has all the hot water it needs to get its work done each and every day. Indeed, the installation is working so well, Brezina says he plans to recommend tankless to the maintenance directors at the four other Florida nursing homes operated by Northport Health, the parent company of West Melbourne Health and Rehabilitation Center. (In all, Northport Health operates 43 nursing facilities in the United States.)

Harris wasn’t surprised to learn the facility is already enjoying such impressive energy savings. He’s been involved with a variety of tankless water heater conversions in Florida in a wide range of facilities. “With tankless, that’s not an uncommon outcome,” he says.

“Thanks to this experience, I’m sold on gas tankless units,” Sun Plumbing service manager Webb says. “What tankless water heaters can do and the amount of money they can save are phenomenal.”  

Julie Reynolds is an associate of O'Reilly/DePalma, an expert in the building and architectural products field. For more than two decades, she has been writing about issues of interest and concern to American consumers. For 15 years, Ms. Reynolds directed public affairs and corporate communications at the National Fire Protection Association. She has worked with the Home Fire Sprinkler Coalition (HFSC) since its founding in 1996 and with the Home Safety Council since 2003. Her byline has appeared in AAA World, the Boston Globe, Flightline, NFPA Journal and Sprinkler Age. She also writes Web content and video scripts.

About Rheem Manufacturing Company

Rheem Manufacturing Company (www.rheem.com) is privately held with headquarters in Atlanta. In its 82nd year of operation, the company manufactures a full-line of high-quality residential and commercial heating and cooling systems; tank, tankless, solar, and heat pump water heaters; swimming pool heaters and commercial boilers throughout North America and world markets. The company’s premium brands including Raypak, Ruud and Rheem have been recognized with countless industry and consumer awards for reliability, innovative design, and high quality. Rheem is the official heating, cooling, and water heating supplier to Richard Childress Racing (RCR) and Kevin Harvick, Inc. (KHI) and sponsors the KHI No. 33 car in the NASCAR Nationwide Series, KHI’s No. 33 truck in the Camping World Truck Series and RHR’s No. 29 car in the NASCAR Sprint Cup Series.