Yes, in general, tankless water heaters are more energy efficient than traditional tank heaters. Traditional water heaters store and continuously heat a large amount of water in a tank, which can lead to energy losses known as “standby heat losses.” Tankless heaters only heat water when it’s needed, so they typically use less energy. Depending on usage and the specific models being compared, homeowners can save up to 20-50% on their water heating bill with a tankless unit.