A tankless unit heats water with its own separate burner, while an indirect water heater uses your existing boiler as the heat source through a storage tank.
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Quick answer
A tankless water heater has its own dedicated gas burner and heats water on demand as it flows through the unit, operating independently of any boiler in the home, while an indirect water heater is a storage tank that has no burner of its own and instead circulates hot water from an existing gas boiler through an internal coil to heat the tank's contents. Indirect water heaters make the most sense in a home that already has a boiler for space heating, since they add hot water production without a second combustion appliance, while tankless units are the more common choice in homes without an existing boiler or where a separate, dedicated hot water system is preferred. The right choice often comes down to whether a boiler is already in place and how it's sized to handle the added domestic hot water load.
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A tankless water heater ignites its own burner whenever a hot water tap opens, heating water as it passes through a heat exchanger inside the unit, with no storage tank and no dependency on any other heating equipment in the home. It requires its own dedicated gas line sizing and venting, separate from any space heating boiler.
An indirect water heater is essentially an insulated storage tank with a coil inside connected to the home's existing boiler loop. When the tank calls for heat, the boiler fires and circulates hot water through the coil, transferring heat into the tank's stored water without the tank having any burner or venting of its own. This makes an indirect unit a natural addition in a home that already has a boiler doing space heating, since it shares that single combustion source rather than adding a second one.
| Factor | Tankless | Indirect (with existing boiler) |
|---|---|---|
| Heat source | Its own dedicated burner | Existing boiler, via internal coil |
| Needs its own venting | Yes | No, uses boiler's existing venting |
| Best fit | Homes without a boiler, or standalone hot water need | Homes that already have a boiler for space heating |
| Storage | None, heats on demand | Insulated tank stores hot water |
| Impact on boiler sizing | None, fully separate system | Boiler must be sized to handle the added hot water load |
In a Metro Vancouver home that already has a gas boiler providing hydronic space heating, adding an indirect water heater is often the more efficient path since it avoids installing and maintaining a second combustion appliance with its own venting and gas connection. The boiler simply gets an additional call for heat when the indirect tank needs it, alongside its existing space heating zones, and a technician verifies the boiler has enough capacity to handle both loads without one function starving the other during peak simultaneous demand.
In a home without a boiler at all, installing an indirect water heater would mean adding a boiler purely to support hot water, which is rarely the most practical route; a tankless unit designed specifically for domestic hot water is the more straightforward choice in that situation.
As a ballpark, not a quote, a tankless installation typically runs $3,500 to $7,500 depending on gas line and venting work, while adding an indirect tank to an existing boiler system varies based on tank size and boiler capacity assessment, and is best quoted after a technician evaluates the specific boiler and household demand together. If a boiler doesn't yet exist and would need to be installed to support an indirect system, that boiler installation itself is a separate, larger cost worth factoring into the overall comparison, varying with system size and scope.
Safety note
This comparison involves gas-fired water heating equipment, venting, and combustion. Any gas line work, venting change, or connection to a gas appliance must be done by a Technical Safety BC licensed gas fitter. If you ever smell gas or suspect a carbon monoxide problem, leave the home immediately and call FortisBC at 1-800-663-9911 from a safe location before doing anything else.
It can if demand exceeds the tank's stored capacity and boiler recovery rate together, which is why a technician sizes the tank and confirms the boiler can keep up with recovery during typical household peak use.
A properly sized boiler and controls prioritize and balance both loads, though a boiler that's already near its capacity limit for space heating may need reassessment before adding an indirect tank.
In most cases yes, since installing a boiler solely to support an indirect tank adds cost and complexity that a dedicated tankless unit avoids entirely for hot water-only needs.
No, they use the existing boiler's venting since the tank itself has no burner, which is one of the main efficiency advantages of pairing an indirect tank with a boiler that's already in place.
A technician assesses the boiler's rated output against your home's space heating load and the added domestic hot water demand to confirm there's enough capacity for both together.
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