Paloma Tankless Water Heaters Review(2024)

Let me guess. Your water heater is on the outs and you know it’s time to replace it, but with advancements in technology and sustainability, you’re just not sure which one to buy. 

You’ve come to the right place. Here you’ll find a review of one of the best tankless water heater brands on the market. I’ve tested them myself and I’ll give it to you straight.

But first, let me tell you why tankless is the way to go. 

Why Go Tankless?

Tankless water heaters, also called on-demand water heaters, offer a lot of advantages over traditional tank-style water heaters. Here are some of the benefits:

• Long-term cost and energy savings 
• Endless supply of hot water
• Compact size
• Lower risks of accidental injuries (such as burns and exposure to toxic metals) 
• Extended durability (tankless water heaters have a life expectancy of 20 years)
• Zero chance of the tank exploding
• Lower risks of water damage and leaks

If you are in the market for a water heater that features all these benefits, then a Paloma tankless water heater is your best choice. Paloma water heaters are at the top of their class in terms of quality, safety, and performance.

I’ve put all Paloma tankless water heaters through a rigorous investigation process to find out what merits and demerits they bring to the table. 

Here’s what I found out.

A Brief History of the Paloma Group

Paloma Co., Ltd. is a global manufacturer of gas-powered water heaters, boilers, and other gas appliances.

The Kobayashi Gas and Electric Appliance Manufacturing Company (now called Paloma) was established in 1911 in Nagoya, Japan, by Yoshisaburo Kobayashi. However, manufacturing ceased shortly afterwards because of Japan’s involvement in World War II.

After the war, Kobayashi Gas made an attempt to increase production and diversify its product line, and in 1952 relaunched under the Paloma brand. Paloma is now one of the leading manufacturers of central heating and cooling systems in the US market.

Since its founding in 1911, Paloma has been steadfast about one thing: providing its customers with products that put safety ahead of everything else. They believe that genuine technology must have advanced safety features, no matter how complicated or easy to use it is.

Paloma Tankless Water Heaters Review

Paloma tankless water heaters are split into two efficiency categories:

• Paloma High-Efficiency Tankless Water Heaters
• Paloma Mid-Efficiency Tankless Water Heaters

Each Paloma water heater is a cutting-edge piece of equipment, and most of them are Energy Star certified. In addition, the Paloma product line of tankless water heaters is remarkably consistent in terms of design and functionality.

I’ve put every Paloma tankless hot water heater from both efficiency categories through a painstaking six-step review process to find out how they stack up against the competition. 

Paloma High-Efficiency Tankless Water Heaters

These condensing tankless water heaters are the best heaters in Paloma’s product range. Utilizing a two-way heat exchanger, condensing tankless water heaters are able to get the most out of the energy delivered to the system. A condensing tankless water heater not only saves money on venting but also operates more efficiently. 

All condensing tankless water heaters operate at energy efficiency of greater than 90%, while their non-condensing counterparts typically operate in the low- to mid-80% range.

There are two models in this category, the PHH-32RDV indoor model and the PHH-32ROF outdoor model. Both models can provide enough hot water for four fixtures in your home. They use a combination stainless steel and copper condensing heat exchanger, which is more energy efficient compared with the previous models.

All PHH models are Energy Star certified, so buyers could be eligible for a federal tax credit. This energy-efficiency certification also means that users are choosing a product that is among the top 25% for efficiency. Depending on the age of your current equipment, buying an Energy Star-certified product from Paloma may save you 15%–40% on your utility bills.

These units are fitted with Paloma’s proprietary Incomplete Combustion Avoidance Device (ICAD system), which monitors combustion levels. If excessive levels are reached, the unit will shut down to stop the emission of harmful by-products. They are also fitted with the Flamesafe protection system, another trademarked system that shuts down the hot water flow when a fault occurs. If a fault does occur, the in-built diagnostics system records the corresponding error code to help you diagnose the issue.

Other interesting features include the following:

• They have a maximum flow rate of 9.5 GPM at a 35°F temperature rise, a minimum flow rate of 3.8 GPM at a 100°F temperature rise, and an activation rate of 0.4 GPM.
• Both PHH-32 Paloma water heaters have an ultra-low NOx burner with a maximum output of 199,900 BTU/hr.
• Safety features include the combustion monitoring ICAD system, a flame failure monitor, anti-scald protection, and a resin over-limit wrap that covers the combustion chamber.
• Both Paloma water heaters have a maximum temperature of 140°F. However, they can be upgraded for commercial use with a conversion kit that raises the maximum hot water temperature to 180°F.
• These tankless water heaters are some of the most efficient in the industry, with an energy efficiency rating of 94% and an energy factor of 0.94. 
• These gas appliances are high-altitude capable and can withstand low temperatures up to -30°F.
• You can connect up to 20 PHH-32 models simultaneously using a DUO-nex cable.
• Some accessories that are included with every purchase are a 120V power cord (for indoor models only), a wired temperature remote control, and a diagnostic display for easier troubleshooting.
• These models have a 12-year residential warranty on the heat exchanger, a 5-year parts warranty, and a 1-year labor warranty.

The PHH-32 tankless hot water heaters are available for purchase for around $1,300.

Some common drawbacks associated with these Paloma tankless water heaters include inconsistent hot water temperatures, low water flow, and insufficient hot water. However, these issues can be sorted out by simply going through the troubleshooting guide provided by the manufacturer. 

The PHH-32 RDV and PHH-32ROF are some of the best tankless water heaters available on the market. With an energy factor of 0.94, these units are the most effective whole-house tankless water heating solutions available.

Paloma Mid-Efficiency Tankless Water Heaters

There are three models within this category. These models are further split into indoor and outdoor models. I’ve listed them below in order of efficiency and performance.

1. Paloma PH2-28 Mid-Efficiency Tankless Water Heaters

The PH2-28 tankless water heaters sit at the top of Paloma’s mid-efficiency category. The PH2-28RDVS and PH2-28ROF are high-volume tankless water heaters that can provide adequate hot water for up to three showers or a whirlpool bath. 

As with the previous models, the PH2-28 models have an abundance of safety features, including an overheat limit wrap, anti-scald protection, a flame failure monitor, flame rods with flame failure detection sensors, a resin film covered combustion chamber, and the emissions monitoring ICAD system.

Other features include the following:

• Both models have a built-in diagnostics and usage recording system that allows for easy servicing.
• All PH2-28 models are Energy Star certified, so users can enjoy federal tax rebates for high-efficiency home appliances.
• These Paloma tankless water heaters have a maximum flow rate of 9.5 GPM at a 35°F temperature rise, a minimum flow rate of 2.5 GPM at a 100°F temperature rise, and an activation flow rate of 0.4 GPM.
• The low NOx burner on these models has a maximum output of 199,900 BTU/hr. 
• These Paloma tankless water heaters have an energy-efficiency rating of 84% and an energy factor of 0.82.
• The indoor model supports both vertical and horizontal venting.
• Both models are available in liquid propane and natural gas configurations.
• Accessories that are compatible with these low-energy systems include a DUO-nex cable that allows for the cascading of up to 20 PH2-28 models, a multi-unit system controller, an electronic manifold with an optional controller, a descaling kit, and tankless installation valves.
• Other accessories that are shipped with these units include a wired temperature remote control, a 120V power cord (for indoor direct-vent models), an integrated appliance adapter, and a condensate drain.
• Just like the previous models, the PH2-28 models have a 12-year residential warranty on the heat exchanger, a 5-year parts warranty, and a 1-year labor warranty. 

These models are available for purchase from select stores for around $1350.

One common drawback that I came across while reviewing these Paloma tankless water heaters is that most users reported that their units displayed the “error code 05” followed by a string of beeping alerts that stop when a water faucet is closed. This could indicate that the vent terminal is blocked, which is a very serious issue. 

A gas heater generates carbon dioxide, which is a lethal and hazardous gas, by burning fossil fuels. If the water heater vent is obstructed, it might lead to carbon monoxide poisoning. 

This specific problem is caused by poor installation of the tankless water heater. It is highly recommended that you contact a licensed contractor for service and that you follow your local city codes for plumbing. You should also ensure that your blower motor is working properly.

The PH2-28RDVS and PH2-28ROF are some of the best non-condensing tankless water heaters on the market. They provide enough hot water for both domestic and commercial applications while maintaining top-notch energy efficiency and safety standards.

2. Paloma PH2-25 Mid-Efficiency Tankless Water Heaters

Just like the previous models, the PH2-25 range also has indoor and outdoor models. The PH2-25RDVS and PH2-25ROF can support two showers and an extra faucet. These Energy Star-certified on-demand water heaters can also be converted for commercial use with the addition of a high-temp computer chip, which raises the maximum temperature from 140°F to 185°F.

The PH2-25 models share the same features as the PH2-20 models. However, there are a couple of upgrades included in the PH2-25 models that are worth mentioning:

• These models have a low NOx burner with a maximum output of 180,000 BTU/hr.
• These Paloma hot water heaters have a maximum flow rate of 8.4 GPM at a 35°F temperature rise, a minimum flow rate of 3 GPM at a 100°F temperature rise, and an activation flow rate of 0.4 GPM.
• They are available in natural gas and liquid propane configurations.
• Some of the advanced safety features integrated into the PH2-25 models include the combustion monitoring ICAD system, a resin film that surrounds the combustion chamber for overheating detection, a flame failure monitor, anti-scald protection, and an overheat limit wrap.
• The PH2-25 models have Paloma’s proprietary iQ system that uses smart sensors to ensure constant water temperature while using the minimum amount of gas at any time.
• With the inclusion of a DUO-nex cable, you can cascade up to 20 PH2-25 models that can be used simultaneously.
• Additional accessories include a digital controller that changes the water temperature precisely and instantly at the touch of a button, an MIC-180 manifold controller, a 120V power cord (for indoor direct-vent models), and an integrated appliance adapter and condensate drain for simplified venting (for indoor direct-vent models only).
• These models are available with a 12-year residential warranty on the heat exchanger, a 5-year parts warranty, and a 1-year labor warranty.

Both PH2-25 models are available for purchase for around $920.

In addition, although the indoor version can sustain three fixtures in warm climates and two fixtures in colder locations, Paloma does not recommend installing the outdoor version in climates where freezing is possible.

These Paloma tankless water heaters are not meant to work constantly with a circulation system, which is a significant drawback. Therefore, if there is one hour of continuous combustion, the error code 00 is likely to arise. The flow sensor will generate a beeping tone.

This error code is simple to fix. All you need to do is close all the water faucets to rest the water heater.

Despite these drawbacks, the PH2-25RDVS and PH2-25ROF are highly capable tankless water heaters with the ability to provide hot water to three fixtures simultaneously and on demand.

3. Paloma PH2-20 Mid-Efficiency Tankless Water Heaters

The PH2-20 tankless water heaters are the least expensive low-energy systems offered by Paloma. The PH2-20RDVS (indoor version) and PH2-20ROF (outdoor version) are the ideal hot water solutions for single-bathroom houses. They can simultaneously support one shower and an extra small fixture, such as a sink.

The PH2-20 models have the following salient features:

• These compact units weigh 54 lbs., which helps to save space compared to conventional tank-style water heaters.
• They are available in natural gas and liquid propane configurations.
• These Paloma water heaters can be used at altitudes of up to 9,840 ft above sea level.
• Each of these units has a low NOx burner with a maximum output of 150,000 BTU.
• They have a maximum flow rate of 6.4 GPM (gallons per minute), a minimum flow rate of 0.26 GPM, and an activation flow rate of 0.4 GPM.
• Both PH2-20 models have an energy-efficiency rating of 84% and an energy factor of 0.82.
• Both models have freeze protection of up to -22°F and operating temperatures that range from 100°F to 140°F.
• These units are fitted with , which monitors combustion levels. If excessive levels are reached, the unit will shut down to stop the emission of harmful by-products.
• Other innovative safety features built into these appliances include an overheat limit wrap, Paloma’s proprietary Incomplete Combustion Avoidance Device (ICAD system), a flame failure monitor, and anti-scald protection.
• These gas appliances can be fitted with multiple accessories, including a high-temp commercial conversion kit that bumps up the water temperature from 140°F to 185°F, a DuoNex cable that allows you to cascade multiple units, and a multi-unit controller.
• You can also get a remote controller that allows you to turn on and control the temperature of the unit from anywhere in the house. 
• These units are available with a 12-year residential warranty on the heat exchanger, a 5-year parts warranty, and a 1-year labor warranty.

These units are available for purchase for around $800 from select retailers.

There are, however, a couple of drawbacks that I need to mention. Some customers reported low water flow after a few years of use. Paloma advised them that this issue might be caused by sediment buildup. It’s highly recommended that you schedule routine maintenance and cleaning of your Paloma tankless water heater to remove built-up sediment.

Other users reported that their units’ ignition systems weren’t working. This might be due to a gas valve that is not completely open or a broken component that’s causing low gas pressure. There might also be gas buildup in the gas line, which prevents the gas from flowing smoothly.

All in all, these are highly efficient water heaters with hundreds of positive customer reviews. If you’re looking for an affordable tankless water heater that incorporates a slew of safety features, the Paloma PH2-20RDVS and PH2-20ROF are the best options for your small home.

The Bottom Line

Paloma tankless water heaters deliver an endless supply of hot water that’s suitable for a variety of domestic applications. Your entire family can take a shower without running out of hot water so long as the gas and electric supplies are not disrupted. According to manufacturer specifications, Paloma heaters are, on average, up to 87% energy efficient, making these gas water heaters an outstanding investment. 

Even the most fiscally austere homeowners will be persuaded to invest in these low-energy systems due to the numerous benefits they offer. Visit the Paloma website today to find out more about these tankless water heaters.

Paloma Tankless Water Heaters Review Methodology

This section covers the procedure I used to evaluate these Paloma tankless water heaters.

Step 1: A list of all Paloma water heaters

I started my research by creating a list of the most widely distributed Paloma tankless water heaters in the United States. This required hours of research on websites like Amazon, Home Depot, Wal-Mart, and Costco in order to identify which Paloma tankless water heater is the most popular among customers.

Step 2: Online reviews

The last step was to analyze user comments on major review sites, including the Better Business Bureau, TrustPilot, Google Business, and Amazon Reviews. It was crucial that I collect customer feedback in order to determine whether the manufacturer’s claims were confirmed by consumers.

Step 3: Product analysis

As a second step, I compiled a list of the main characteristics I would want in a tankless water heater. I had to compare Paloma water heaters to electric tankless water heaters and other storage tank types to provide a more realistic evaluation. Here is a list of all the characteristics I was searching for, as well as the key questions I wanted answers to:

• What is the difference between a gas tankless water heater and an electric tankless water heater?
• What is the difference between a tank water heater and a tankless water heater?
• What innovative technologies are incorporated into Paloma tankless water heaters and how do these innovations compare to the competition?
• How much hot water (in gallons per minute) does each Paloma water heater produce at maximum output?
• What is the energy efficiency of Paloma water heaters and how much money will a customer save on utility bills after one year of use?
• How does the Paloma product warranty differ from other brands?
• How do Paloma low-energy systems differ from what Rheem has to offer?

Step 4: Interviews with real customers

Next, I talked with actual Paloma water heater users who had direct experience with the brand. So, I reached out to a few friends and arranged a door-to-door survey within a 30-mile radius of my area. I also spoke with a few plumbing contractors about their experiences with Paloma water heaters, and the low-energy systems in particular. To expand my reach, I also ran an online poll on Facebook and Twitter. After five days of painstaking investigation, I had accumulated sufficient knowledge.

Step 5: Getting in touch with Paloma

Next, I got in touch with Paloma to get a response to the negative customer feedback I came across on online review sites. This allowed me to observe how Paloma engaged with consumers and how its customer service representatives handled themselves under excessive pressure.

Step 6: Test drives

I then asked Paloma to send me several of its tankless water heaters for evaluation. I wasn’t sure of the reaction, but I decided it was worth a try. Surprisingly, I received a response quickly and Paloma sent all of its tankless units. So, I leased a warehouse, procured two water bowsers, and started testing each water heater.

Final Thoughts

Paloma provides a comprehensive selection of tankless water heaters for both residential and commercial applications. These low-energy systems are endowed with some of the most advanced safety features on the market, including the trademarked ICAD system, which monitors combustion levels, a flame failure monitor, anti-scald protection, and a resin overheat-limit wrap that covers the combustion chamber.

Paloma tankless water heaters also have an amazing 12-year residential warranty, a 5-year parts warranty, and a 1-year labor warranty.

The majority of customer reviews for Paloma water heaters are positive. Users say that their water heaters function as claimed, delivering the required volume of hot water on demand.

If you’re looking for a tankless water heater that is inexpensive, highly efficient, and offers a slew of safety features, then a Paloma water heater is your best choice. If you are interested in what the competition has to offer, check out my article on the best tankless water heater.

In addition to Paloma, if you’re seeking reviews on water heaters from various other brands, our comprehensive collection of water heater reviews encompasses a wide range of options available on the market. You can find detailed information and insights here:

• Rinnai Tankless Water Heater Reviews
• Eemax Tankless Water Heater Reviews
• Takagi Tankless Water Heater Reviews
• Navien Water Heater Reviews
• Stiebel Eltron Tankless Water Heater Reviews
• Ecosmart Tankless Water Heater Reviews