Large water tanks or many small ones? (efficiency)

[Fynall]

Hello. I'm the landlord of a building consisting of 8 rental units. All the units have 1 bathroom, 1 kitchen, 1 bedroom, 1 living room and a corridor linking them. There are currently 12 tenants living in the building, 4 tenants are single and 4 couples. There could potentially be 8 couples for a total of 16 people but that is very unlikely.

The tenants pay for everything except for hot water which I provide. I bought the building last year and the water tanks will be 10 years old in a month or two so I need to replace them. Currently, there are 3 large water tanks and 1 smaller one. I believe 3x 65 gallons (246 L) and 1x 40 gallons.

My question is, what would be the most efficient replacement in terms of cost for me? The estimate at the moment comes out at about 2000$/year. Is it better if I get the largest possible water tanks (and how many would I need), or several smaller ones? I thought about having 1 for each apartment with the possibility of making it so that the new tenant that will move in will be responsible for his own hot water bill, but 2000$/8/12 comes out at about 20$/month of saving for me. I think I would have to decrease the rents by more than 20$ if I excluded hot water. Therefore, I'm trying to keep it as it is, but reduce the cost as much as possible through efficiency. How many gallons would I need total for all the apartments, and what would be the best setup? Thank you.

I live in Canada, Montreal so if possible please consider the products available in Montreal. Most common shops include Home-Depot and Reno-Depot.

 

[Jadnashua]

FWIW, the larger a tank is, the less surface area it has per volume, so in theory, assuming similar insulation, a larger tank will be more efficient.

 

[Sponsor]

 

[Phog]

Unless you have the ability to move to natural gas appliances, with their much less expensive energy costs, you're probably not going to improve your monthly utility bill by reconfiguring anything. It will be more expensive in terms of both equipment as well as installation costs to move to dedicated units for each apartment. You also won't move the needle on costs much by changing the number of tanks. Everything apparently works as-is and has probably been sized that way through the experience of previous owners and tenants. It's hard to see in the pic but it looks like the tanks are plumbed in parallel (as opposed to in series) which is not surprising given the demand of 8 apartments. If so changing the plumbing could lead to flow balance issues. So your best bet is probably to just replace what you have with identical. Do take opportunity to insulate the hot water pipes. It will reduce standby losses.