Energy Efficiency
An instant hot water dispenser which keeps water hot in a tank uses the energy needed to heat the water to the required temperature, and wastes the energy needed to keep the water hot permanently in a thermally-insulated tank when not being used. An instant heater without a tank does not waste significant energy.
In many cases the alternative is to heat water in, say, a kettle. It is obvious that if only the amount of water needed is heated, energy usage is less: the same energy is used for heating, but none for keeping hot. If more water than needed is boiled in a kettle, energy is wasted in heating the unwanted water, which then cools.
Sometimes a supply of an unknown amount of instant hot water is required, for example when cooking risotto boiling water must be added instantly as needed. This can only be achieved with a kettle by boiling the maximum amount that can be needed; in cases of this nature the instant water heater, which heats and dispenses only what is needed, is always more efficient.
Overall comparative efficiency can only be estimated by calculating the energy wasted by the water heater, and comparing it with that wasted by heating more water than necessary in a kettle in typical circumstances. Kettle efficiency is subject to patterns of usage, and can be improved by user discipline; dispenser efficiency cannot be so improved. Switching off when not needed, as at night, would save some energy and improve overall efficiency.
Read more about this topic: Instant Hot Water Dispenser
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