The Canadian Competition Bureau has issued a fine of 25 million dollars to both Direct Energy and Reliance Comfort. The charges suggest that the two water heater rental companies have been gouging customers and making it ridiculously difficult to end contracts. Both Direct Energy and Reliance offer rental water heaters throughout Ontario.
Critics suggest that the industry is mainly a big scam as the cost of renting a water heater is nearly high enough to cover the cost of owing one. In addition the penalties to exit a contract are exorbitant and designed to confuse and frustrate a customer into giving up.
Interestingly this isn’t the first time that Direct Energy has been in hot water. In 2002 following a similar investigation the Competition Bureau enforced new rules and conduct guidelines that Enbridge Services (now Direct Energy) was required to follow under a 10 year consent order. The investigation found that Direct Energy re-engaged in the sleazy conduct in February of 2012.
As for Reliance, the company was apparently in a co-operative discussion regarding its hot water tank return policy. They also suggested that the company had initiated the difficult return policy in an attempt to thwart rival water heater companies.
I cant think of a better reason to simply purchase your own water heater, be that a tankless or just your conventional power vent. The rental business can be full of bureaucracy and technicalities. If you must have the peace of mind that comes with a full service, 24 hour emergency replacement then it might be worthwhile to look into maintenance plans. These are usually only 5-10 bucks a month, depending on equipment and gives you a full sense of security, oh ya, also no long term contract.
Interested in moving away form a rental and into owning your water heater?
We have helped many of our customers escape their long term contracts.
Here is an interesting post that I spotted on RedFlagDeals – that’s a popular Canadian site offering deals and helpful info to people. I recommend you check it out if you’re interested. Anyways this user had some questions regarding tankless water heaters and was looking for responses from current owners. Here is their inquiry.
I’ll be moving into a brand new town-home in downtown Toronto next year, and we need to decide on which option to go for the water heater:
Rent the tank system from Direct Energy (installed by builder…)
Buy a tank system and replace the rental
Rent a tankless system
Buy a tankless system
Our priorities are, in order of most important first:
Continuous hot water
Operating & Maintenance costs
I know the tankless system wins for 1 and 3… but what about 2, 4, and 5? After reading through this thread, I only read a few things about the noise issue. We want to mount this on a wall to save space and use that area as storage, but if it’s going to rattle our small townhome’s walls, that’s a serious concern.
Here Is Our Take
Right off the bat I would instantly recommend a tankless if your number one concern is space. A tankless wins hands down. I will go though the issues this user brought up briefly.
Space – tankless saves a lot, it wins.
Temperature – Toss up, but I would probably give it to the tankless because of its precision
Continuous supply – obviously the tankless takes this category
Noise – depends on which type of conventional tank you could install, but I call it a draw – both would probably be power vented units so the blower makes the most noise.
Tank wins but only for a short period as it will run out of water as more appliances demand hot water.
Tank is cheaper for sure – a tankless does have much higher upfront costs.
Tank – a tank will be cheaper on maintenance as there really isn’t any, but that tank has a lifespan of 8 years where as the tankless is 20. Yep you will pay a little more on maintenance but it more than makes up for it over time.
If you own a tankless it is important to service your system. A tankless is designed by engineers to have, first and foremost, the heat exchanger and internals scrubbed with a mild acid (vinegar). The vinegar reacts with a buildup that occurs in all pipes and watercourses (scale and lime deposits) effectively eating it away and clearing the heat exchangers and pipes. This scale acts as an insulator significantly reducing the transfer of heat to water. Engineers have also taken many precautions to ensure that internals and parts of a tankless have as few wear points as possible. This has increased the lifespan of a tankless water heater to over 20 years!
Direct Energy and several other large companies that rent water heaters are trying to reduce the tankless emergence. Currently if you’re renting a conventional water heater the system is designed to have a lifespan of around 10 to 12 years. After this point the water heater will have significant buildup inside severely reducing its efficiency. The thing is that none of these companies will push you to replace your system since you are the one paying the gas bill and it only affects your homes energy consumption.
What Can You Do?
That’s easy, call the company your renting your water heater from. They will tell you the buyout costs and the age of the water heater you have. If the system isn’t very old I would recommend you keep the water heater until it reaches its operational lifespan (10-12 years). If your system is already quite old you may simply need to schedule a removal with your water heater rental company. Then start getting quotes for a tankless system.
Once that new tankless is installed make sure you take care of it, have it flushed once every two years at the minimum (or flush it yourself). A flush is simple preventative maintenance that will ensure your system makes it past the expected 20 year lifespan while maintaining its 98% efficiency rating!