Hybrid and on-demand water heaters are more expensive primarily because they have a much longer lifespan than storage tank heaters. They typically last 15 years or up to 20 years with annual maintenance. In contrast, conventional storage tank heaters last anywhere from 10-12 years. Hybrid and on-demand heaters are also safer to operate. Hybrid water heaters don’t combust so you never run the risk of carbon monoxide or exhaust gas spilling into your home. On-demand water heaters are direct-vented and sealed so they also prevent the risk of carbon monoxide or exhaust spillage. Hybrid and on-demand heaters are also more efficient than storage tank heaters. While the upfront cost may be high, you’ll see a big improvement on your monthly energy bill.