# Who rents hot water tanks in Ontario?



## Addy

This is something I could find out from our real estate agent if I can't figure it out myself. We bought a house in Petawawa, Ontario and I want to find out from whichever company holds the rental contract with the previous owner, how much they want for it if I buy it out.

The problem is, not being from Ontario I have no clue who most likely would be the company who rents the tank to the current owners. Is there a company or two that most likely would be the one, or are there so many it would be difficult to say?


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## HaroldCrump

That's the beauty of the situation...just sit back, relax and the bill will come to you automatically 

The previous owner will notify the rental company to transfer the lease to you.
The rental company will mail you a bill and a contract, including a buy out offer.
At that point, you have the choice to lease at that rate, buy out, or entirely dump them and go with a new water tank from a different company.


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## Addy

HaroldCrump said:


> That's the beauty of the situation...just sit back, relax and the bill will come to you automatically
> 
> The previous owner will notify the rental company to transfer the lease to you.
> The rental company will mail you a bill and a contract, including a buy out offer.
> At that point, you have the choice to lease at that rate, buy out, or entirely dump them and go with a new water tank from a different company.


Sweet!  Thanks for the reply, one less thing to worry about before our move!


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## HaroldCrump

I should probably add that there must be a label or sticker on the tank identifying the company, including an address and a phone number.
Ideally, there should also be a list of service visits and maintenance notes.

If you don't want to wait for the bill in the mail, or once it's been a few weeks/months, just call that number to avoid surprises later.


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## OhGreatGuru

The information will be on your Hydro bill (at least in Ottawa the billing is done through Hydro, even though the tank is owned by a third party) or on the water heater. I would contact them as soon as you can and tell them you do not want to assume the lease. I have heard that as soon as you make a monthly payment it may be considered a tacit agreement to renew the contract.

PS: I don't think you are under any obligation to "buy out" the lease if you think the price is unreasonable. You are not (yet) a party to the previous owner's lease agreement. You can tell them to take their water heater and you will buy your own.


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## carverman

If this is a electric HWT, then either the local utility or a tank installation
company is doing the rental. It would appear on the electricity bill.
If it was me, I would advise the company (sticker should be on the tank
if it's a rental) that you are not going to enter into a rental agreement 
with them. Being a new owner, you are under no obligation to assume
the existing contract. 

Do it as soon as you can to avoid having to pay the first rental bill,as
that could be an implied assumption of the existing contract.

Go to H-D or Home Hardware in Petawawa (or Pembroke) and buy a
new tank. Your hubby should be able to self install those easily.


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## Financial Cents

Likely the hot water tank is rented from Direct Energy. Don't worry, you'll get a bill 

We still rent our tank, but hopefully over the next year, we can buy ours and stop paying monthly fees for it. We just moved into this new house 6 months ago.


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## Cal

I bought mine out, 4 years ago...it was around $1100.

Generally speaking the rate will start around $1500...and will drop a bit every year to buy it out.

For me I figured in 5 years, assuming no break downs or repairs, I would be even. In my case it was a smaller 1 year old tank.


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## carverman

Cal said:


> I bought mine out, 4 years ago...it was around $1100.
> 
> Generally speaking the rate will start around $1500...and will drop a bit every year to buy it out.
> 
> For me I figured in 5 years, assuming no break downs or repairs, I would be even. In my case it was a smaller 1 year old tank.


Thats crazy! You are paying them bribe money to take their tank away.
This is ridiculous. If Hudak gets in, this is another item on his agenda to
get rid of...too much carpet bagging going on in this province under the
nose of McGuinty.

A new gas water heater (GE Self clean 40 US gal) is about $549 at H-D.

So if you paid the <expletive> $1100, they got all their money up front and
you were still out $600 for the new tank! Thats probably $2000 with
installation and taxes? Criminal!


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## I'm Howard

We just paid $50 to buy ours from Reliant, about ten years old.

I am going to call Direct Energy on Monday as i have been told they have a programme for a Tankless Heater, which is what we want installed.

$1,500 if we do it ourself, i will see what options there are??


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## carverman

I'm Howard said:


> We just paid $50 to buy ours from Reliant, about ten years old.
> 
> I am going to call Direct Energy on Monday as i have been told they have a programme for a Tankless Heater, which is what we want installed.
> 
> $1,500 if we do it ourself, i will see what options there are??


Why tankless Howard? The advertising hype convincing you that is the
way to go these days?

The tankless water heater is a demand style water heater. The flow rate
has to be set up from the meter, so enough water is flowing before the
gas burner kicks in around the warming pipe (manifold). 
So the first 3-4 litres (or possibly more in the winter time when the city water is colder), is infact, luke warm or COLD WATER.

You don't get instant hot water, from your hot water tap until sufficient water
has run out, as water is sitting in your hot water pipes and that cools off over time.

The difference is of course, if you are the type that spend an hour in the
shower, you won't run out of hot water..or if you have teenagers that
do the same. But there is NO SAVINGS in installing a tankless.
Water is water, you pay the same rate for what you use and gas is gas.

The rental charges are going to be much higher and for longer periods of
time too. 

So you will pay the rental company a fixed rate for some many years on
the tankless rental + HST on the rental charges.


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## Addy

Forthose on metered water I especially would not advise endless hot water. It encourages wasting water when showering. With a tank, when the hot water runs out, shower is over shortly after!


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## carverman

Addy said:


> Forthose on metered water I especially would not advise endless hot water. It encourages wasting water when showering. With a tank, when the hot water runs out, shower is over shortly after!


If you go for the larger tank, 60 gals, you shouldn't run out of hot water
even with long showers, although you will be using more gas and water
as you mentioned. Depending on the tap temp, there should be approximately a 50-50 mix on the showerhead.

For instance a 40 US gal tank like the GE Smart tank that I installed myself
in 2000, holds 151 liters of hot water. The 60 US gal tank holds 227 liters.
It has been trouble free for 9 years, cost me a bit over $300 and I expect another
4 years out of it trouble free. 

Now that means for a 40 US gal..it's about 80 gallons(300 litres)...of shower (or wash machine, even if you use hot water..which I don't), you can easily spend over an hour in the shower and still have warm or even hot water as you use it since the nat gas tank recovery is much faster than an electric one.

Even then you are not going to experience cold water, as the burner
thermostat will kick in as soon as it senses the water temp inside the
tank below the setting that you set.

So the real issue here is the cost of city water + sewer charges for 1000 liters of water (1 cubic meter = 1000 litres) + nat gas or electricity to
heat it.


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## I'm Howard

The major problem I have is that we have a 40 gallon tank which runs out of hot water before a bath is filled, plus the noise from the venting fan is obnoxiously loud.

The baths are larger than normal, six foot soaker tub , also corner tub, so I guess they require a lot to fill?

I am into the tankless mode as I was told it is more cost effective than maintaining a hot water heater which is constantly burning gas???

The possibility is very strong we will rent our place to a ski Family for the winter, so I want to make sure they don't have problems??

Excellent Info.


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## carverman

I'm Howard said:


> The baths are larger than normal, six foot soaker tub , also corner tub, so I guess they require a lot to fill?


Well you may have something wrong with your tank. A bathtub even a soaker
doesn't take 40 gals of hot water..besides unless you want to get scalded,
the tub should only take about 15-20 gal..thats 60 to 80 litres of water,
otherwise it's going into the overflow drain that tubs have. 



> I am into the tankless mode as I was told it is more cost effective than maintaining a hot water heater which is constantly burning gas???


A properly functioning gas hwt burns "standby gas" for the pilot and yes, that
is constant..not a huge amount but over a month, the pilot will burn around
$6.00 worth of gas, since the pilot has to be lit at all times..this is the
disadvantage of the older hwt. The new powervent have electronic ignition
and don't require a pilot.

The tank burner itself, if the thermostat is working, will only come on if
the hot water in the tank gets below a certain preset temp (the one
you set on the gas valve, or you use up the hot water in the tank.
There are 3 or 4 temp settings, plus Vacation and off course, OFF.

So other than the pilot consumption, the main burner coming on will
burn gas,at the normal input btu rate whether its a tankless or not.

In the summer months, when most people are on vacation, 
the gas consumption is zero... if you have the electronic ignition tanks, so the
gas company (Enbridge) has to make money somehow, so they will
send you a minimum bill regardless of whether you use zero cubic
ft of gas or a small amount for the pilot. This is currently $19.00 customer service charge to stay hooked up to their system. 



> The possibility is very strong we will rent our place to a ski Family for the winter, so I want to make sure they don't have problems?? Excellent Info.


Well, the first thing you want to consider is the age of your Hwt and whether
it is supplying hot water the way it is supposed to. Depending on your
water source, hard water will encrust the inside of the tank, so the heat
transfer is not as efficient + lime will accumulate in the bottom of the tank.
That is why there is a drain valve..to flush out the crud at the bottom of
the tank. 

If your tank is more than 10 years old, yes you may want to consider replacing it, but a tankless is going to cost you a lot.
First of all, most companies charge $ for installing it, if any plumbing needs
to be modified to accomodate it + the necessary piping/plumbing required
so it's not going to be cheap..unless you sign a contract for x amount of years with the rental company. Normally it requires a 3/4" copper pipe
run from the main 3/4 inch run in the house at the meter. If you have
1/2 pipe from the meter, that has to be changed for the tankless heater,
because it wont work unless there is a minimum flow rate to turn the burner
on. see tutorial.

http://homerepair.about.com/od/plumbingrepair/ss/tankless_hwh_2.htm


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## OhGreatGuru

I'm Howard said:


> The major problem I have is that we have a 40 gallon tank which runs out of hot water before a bath is filled, plus the noise from the venting fan is obnoxiously loud.
> 
> The baths are larger than normal, six foot soaker tub , also corner tub, so I guess they require a lot to fill?
> ...


From the sound of things you have a 40 gal. gas-fired hot a water tank. It is rare for a house to have a larger gas-fired tank because of their high recovery rate compared to electric. If you can't fill your soaker tub with it there is likely something wrong with either the heater or the plumbing.

PS: Many gas-fired water heaters have a consumer-adjustable thermostat. Check if yours has been turned down low to conserve energy.


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## carverman

OhGreatGuru said:


> From the sound of things you have a 40 gal. gas-fired hot a water tank. It is rare for a house to have a larger gas-fired tank because of their high recovery rate compared to electric. If you can't fill your soaker tub with it there is likely something wrong with either the heater or the plumbing.


and I would put my money on, it's the gas valve thermostat seizing up or malfunctioning in the way it senses temperature. 
http://www.nextag.com/water-heater-gas-valve-thermostat/products-html

http://www.acmehowto.com/howto/home...ces/waterheater/diagnose-gas-water-heater.php


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## Karen

Try as I might, I cannot figure out why anyone would rent a hot water heater. I had never heard of such a thing until it came up a few months ago on another thread. Does this only happen in Ontario? It certainly doesn't in BC. How much does it cost on a monthly basis?

My neighbours just had a new tank installed by Sears and told me it cost them $1070 including installation and HST. Mine has lasted nearly 20 years so far. I'm sure it will need replacing soon, but unless the rental would be almost nothing, I can't see how it would pay to rent rather than buy, even if I could.


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## cannon_fodder

Karen, with GST, our HWT rental is about $25/month. Of course, service calls are included in that price (we have had 2 or 3 in the 8 years we've owned the tank including one just before we went on vacation).

Not only do we rent HWTs in Ontario we buy our milk in bags!


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## carverman

cannon_fodder said:


> Karen, with GST, our HWT rental is about $25/month. Of course, service calls are included in that price (we have had 2 or 3 in the 8 years we've owned the tank including one just before we went on vacation).


And I suppose you pay $100 to $150 for a maintenance plan on your gas
furnace, that you own and doesn't normally need any maintenance..except
to replace the air filter?

lets do the math:$25 x 12 = $300 per year x 10 years= $3000.
Not bad for the rental company. Now multiply the number of households
in Ontario that think they have to rent or assume rental agreements and
now you have a profitable business for very little cash outlay on the
rental companies part. 



> Not only do we rent HWTs in Ontario we buy our milk in bags!


We can still get it in wax cartons, more expensive, but considering it came originally from a bag...


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## carverman

Karen said:


> Try as I might, I cannot figure out why anyone would rent a hot water heater. Does this only happen in Ontario?


It all started years ago...the BNA/Confederation/the boiler act...wood heating..lack of thermostats..explosions on hot water heating systems with radiators..it was costly to fix these, so some home heating companies offered
to rent furnaces/boilers and maintain them and all you had to do is pay the
monthly rent..just like insurance..peace of mind. 
then they came up with new systems..forced air furnaces, new electric
and gas hotwater tanks..and Ontarioans, not used to buying them..
didn't know what to do..keep renting?....of course! exclaimed the gas companies and hwt tank rental companies..hwt tanks can break down on
you and flood your house (note: 40 us gal = 150 litres) and the damage..
the calamity..why not just pay the $25 a month and we will take care of
everything for you? 



> My neighbours just had a new tank installed by Sears and told me it cost them $1070 including installation and HST. Mine has lasted nearly 20 years so far. I'm sure it will need replacing soon, but unless the rental would be almost nothing, I can't see how it would pay to rent rather than buy, even if I could.


Renting is easy..you just pay $25 a month on your gas or electricity bill 
and you don't worry about the cost of fixing it if it breaks down. 
Perhaps to most, $25 a month may be easier to budget than a one time capital cost of $1200 or more for installing a new (power venter tank).

Homeowner is happy..McGuinty is happy collecting HST on the rental..
$300 a year..why that's almost $40 in Premier "Dad's" pocket. 

Can you hear that giant sucking sound?..that's money ( or hot water) going
down the drain.


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## Cal

carverman said:


> Thats crazy! You are paying them bribe money to take their tank away.
> This is ridiculous. If Hudak gets in, this is another item on his agenda to
> get rid of...too much carpet bagging going on in this province under the
> nose of McGuinty.
> 
> A new gas water heater (GE Self clean 40 US gal) is about $549 at H-D.
> 
> So if you paid the <expletive> $1100, they got all their money up front and
> you were still out $600 for the new tank! Thats probably $2000 with
> installation and taxes? Criminal!


Sorry....Either you misunderstood or I wasn't clear.

I paid the $1100 to buy out the water tank. I now own it rather than rent it.

No it was not a great deal. However it was a better deal IMO than renting it continuously. I had been paying about $90 every 3 months to rent. And had no say it negotiating the rental price or amount. That is just what they bill.

I did not have to go and buy another tank.

You are right however for someone who does not want the Direct energy tank...I think there is a removal fee of around $500, and then yes you would have to go and buy and new tank to be installed, which might cost in the neighborhood of $600 depending upon the size of the tank.


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## carverman

Cal said:


> I did not have to go and buy another tank.
> 
> You are right however for someone who does not want the Direct energy tank...I think there is a removal fee of around $500, and then yes you would have to go and buy and new tank to be installed, which might cost in the neighborhood of $600 depending upon the size of the tank.


In my case, Enbridge (who wanted to get out of the tank rental business around 2000), offered to take the tanks back without any penalties. 
All you had to pay for was disconnection and calling them to pickup their
tank or disconnect it yourself. 
Disconnecting it was easy..all you need to do was drain the tank, copper pipe cutter cut the hot/cold pipe to the tank, 
shut off the gas pipe valve at the tank and disconnect the pipe union
to the gas valve in the tank. 

So easy even a cave..er..carverman can do it.


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## Addy

We have a Rheem 40 gallon in our current house. It was installed in 1986 and we have had only one small problem - the anodode tube or whatever it is went, hubby replaced it himself for $20 or so. This was about two years ago. We haven't had any issues with it other than that.

We do however, clear the tank out every 2-3 yrs. I wonder how many homeowners even realize they should clean their tanks out? Saves you a lot of money and makes the tank last a lot longer. And it's simple to do, a hose and a few buckets of water and you're done. It's incredible the crude that comes out when you clean the hot water tanks!


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## m3s

Most people never drain the sediment out or even know about the sacrificial anode on their tanks. We live in a society of replacement rather than preventative maint. How many people maintain something as important as their brake calipers? The Cdn salt just about seizes them up, but naw, just replace them ina few years instead eh


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## Addy

mode3sour said:


> Most people never drain the sediment out or even know about the sacrificial anode on their tanks. We live in a society of replacement rather than preventative maint. How many people maintain something as important as their brake calipers? The Cdn salt just about seizes them up, but naw, just replace them ina few years instead eh


For sure. And then we turn around and wonder why things are being made cheaper and cheaper quality.... we live in a disposable society that's for sure.

It doesn't stop at things like hot water tanks or brake calipers; our food is crap quality because we generally buy the cheap food vs quality (not that in every case price correlates with quality, but I'd say in general it does). Think about that next time you sit down to a steaming hot bowl of KD!


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## carverman

mode3sour said:


> Most people never drain the sediment out or even know about the sacrificial anode on their tanks. We live in a society of replacement rather than preventative maint.


In Ontario, a great majority prefer to rent their hwt and let the rental company deal with maintenance or replacement..and even the rental
company doesn't replace the anode or drain the spooge..so what good
is renting it when you pay 3 times the cost of the tank over 10 years
and tax as well...it just doesn't make sense to me. 




> How many people maintain something as important as their brake calipers? The Cdn salt just about seizes them up, but naw, just replace them ina few years instead eh


Nobody. it's a dirty job and requires removing wheels and undoing the
caliper pins and cleaning them. That is done during brake pad replacement
though. As far as calipers seizing..I've had two on the drivers side on my
Dakota. First time the oem siezed after 80,000. I had both replaced and
the replacement seized up after 12,000 km on the same side.

It's the luck of the draw on internal caliper piston seizure, I think.


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## carverman

Addy said:


> our food is crap quality because we generally buy the cheap food vs quality (not that in every case price correlates with quality, but I'd say in general it does). Think about that next time you sit down to a steaming hot bowl of KD!


I like KD. I just don't buy it that much because I refuse to pay $1.50 for
a box of genuine KD..macaroni is macaroni..but it's that cheese powder..
there is something magical about Kraft's cheese powder.


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## m3s

carverman said:


> As far as calipers seizing..I've had two on the drivers side on my Dakota. First time the oem siezed after 80,000. I had both replaced and the replacement seized up after 12,000 km on the same side.


I can walk through a Cdn parking lot and point out seized calipers all over the place. Just look at rear rotors, they are often rusted to crap because the caliper is seized and therefore you're missing what ~30% of stopping power



carverman said:


> I like KD. I just don't buy it that much because I refuse to pay $1.50 for
> a box of genuine KD..macaroni is macaroni..but it's that cheese powder..
> there is something magical about Kraft's cheese powder.


LOL I actually prefer the PC white cheddar. Kinda craving some now... they don't sell easy-made macaroni or anything in Deutschland from what I can see


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## Karen

Back to hot water heaters, I've had mine for 20 years, never cleaned it (didn't know we were supposed to), and never have had to have it serviced. Perhaps I was just lucky, but it certainly would have cost me a lot more money to rent one.

And thanks for the historical background on how it came about in Ontario, carverman. Are there other provinces where people rent their water heaters, or is it unique to Ontario?


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## carverman

Karen said:


> Back to hot water heaters, I've had mine for 20 years, never cleaned it (didn't know we were supposed to), and never have had to have it serviced. Perhaps I was just lucky, but it certainly would have cost me a lot more money to rent one.


Well, I'm just as guilty as you in not replacing the sacrificial anode..and I
know exactly where it is on top of my GE tank..or draining it..but it's
still working perfectly since self installation in sept 2000..so thats almost
11 years on a tank thats has a 9 year pro-rated warranty.

I guess, I'll shut it off and let the hot water cool down, drain about 20 liters
or so and look at the anode...I'll report on my findings. 



> And thanks for the historical background on how it came about in Ontario, carverman. Are there other provinces where people rent their water heaters, or is it unique to Ontario?


Karen..you should know me by now, that I like to kid around..that is NOT
an accurate history of why Ontarioans rent water heaters.

I really don't know the real reason.. but it's probably because "it's the way it's done here". 
If you buy a new or resale house, the mortgage, the gas charges and the water heater rental..but not the furnace ...comes built into the price of the house. 
It seems ridiculous, because the contractor for the house construction could just as easily install a "self owned" hwt along with the furnace. 

Perhaps, when the gas meter is installed, I think, the gas company (Enbridge) that used to rent them directly, just notifies the HWT rental company (Direct Energy) which seize the opportunity to shoe-horn one in before the final sales agreement drawn up by the lawyers. Then you have to assume the rental or
face expensive removal or buyouts. It's a scam, but for some reason,
the Ontario gov't allows it.


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## Karen

Oh dear - you got me this time!! I thought it was rather strange, but I didn't question it. I'll have to be more careful in the future!


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## m3s

Karen said:


> Back to hot water heaters, I've had mine for 20 years, never cleaned it (didn't know we were supposed to), and never have had to have it serviced. Perhaps I was just lucky, but it certainly would have cost me a lot more money to rent one.
> 
> And thanks for the historical background on how it came about in Ontario, carverman. Are there other provinces where people rent their water heaters, or is it unique to Ontario?


You have soft water then or your hot water pressure is very low right now (half clogged by minerals from 20 years). If you had minerals in your water then it would clog up for sure and rust elements if you never maintained it. It's kinda like how some people can stay slim without exercise

Ontarians seem to have caved to the door-to-door salesmen and now every rents because it's "what everyone does" I guess nobody every checks the math. Maybe the other provinces have regulations to protect the sheep


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## carverman

Well I checked my 11 year old water heater (GE smart tank/glass lined) and
there is absolutely no spooge when I drained approximately 8 liters this morning. Water was clear as a whistle. Ottawa water is soft water, so this
may have something to do with it. I would suppose that those that have
water softners in front of the HWT could have more issues with mineral sediment and sacrificial anode wear.

I tried to unscrew the sacrificial anode with a 1/1/16 socket and a 3/4 inch
hefty ratchet..it would not budge..infact the tank was moving on me, so
I gave up rather than risk damaging (cracking) the copper plumbing.

I dug out the manual and it says:

CATHODIC PROTECTION
Depending on model, one or two magnesium anodes are installed to prevent
corrosion and extend the life of the tank. 
It is advisable to inspect the condition of the anode(s) at certain intervals.
A 2 year period may be a guide to begin with. The life of the anode depends
on many factors and can differ greatly from one location to another.

I would expect that if you get water from a well and use a water softner
to soften it, the salt ions exchanged for hard mineral (calcium) ions would
speed up the depletion of the anode, but normal soft water shouldn't
have the same galvanic action?


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## carverman

Karen said:


> Oh dear - you got me this time!! I thought it was rather strange, but I didn't question it. I'll have to be more careful in the future!


Karen..you never know when I'm serious or not..I don't always use
smiley icons to "mark" my frame of mind. 

but the "BNA/confederation" should have been a clue..

test tomorrow.


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## carverman

mode3sour said:


> Ontarians seem to have caved to the door-to-door salesmen and now every rents because it's "what everyone does" I guess nobody every checks the math.


Well if you are a renter, you have no choice, as the landlord is not going to
spend his money to buy or replace hwt. The gas charges and the tank rental
are the tenants responsibilty. I don't have any numbers on the percentage
of renters vs homeowners..but assuming it's 50-50..then there is a market 
for hwt rental in Ontario..and the rental companies (Direct Energy/National
Home Service) send out marketers to aggressively canvass the homeowners.
I had to "kick out" 3 in a row in may. Ok, these are innocent college students
promised a summer job, so its the rental companies that conduct shady
business practices..like.."we are in your area and checking everyone's
water heater to see if it needs upgrades"...

*IF I let them in*.."oh I see your HWT is 11 years old, it is near it's service lifetime
and could "burst" on you any day. We will send our technician to check it
out further..but you need to sign here for a "free inspection".
Once you sign, you are on the hook for 15 years at $30 or more per month!
Now, in Ontario, you have 10 days of wiggle room to get out of any contract
you sign..but..these scam artists are smart..they install their tank within
10 days and if you want to cancel after that..you have to pay them 
removal charges which can be significant..in the hundreds of dollars.


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## Karen

You're right mode - our water in the Vancouver area is very soft, so I guess that's why I've had no trouble with the water heater. I have no problem with water pressure, though.


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## m3s

Yea I could have looked at your profile then I would have known because Vancouver does have soft water. Most Canadian cities do not, or NA for that matter


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## cannon_fodder

carverman said:


> And I suppose you pay $100 to $150 for a maintenance plan on your gas
> furnace, that you own and doesn't normally need any maintenance..except
> to replace the air filter?


You supposed wrong... we own the furnace and if there are any issues we pay for them out of pocket.

I've looked at the merits of buying out our tank but we won't be in the house much longer so it seems at best a wash right now.

For the next home we buy then we would own the tank.

I also own and rent digital cable boxes. With renting I get free upgrades to the hardware anytime they come out (e.g. HDMI, SSD drives vs. Spinning HD) plus any issues are fixed for free.

I would say that since I've been a homeowner in Ontario only it seems renting a HWT has become a status quo that one doesn't question. I've looked at it but never felt compelled to consider owning it because of various factors some of which may have been based on misinformation.


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## andrewf

Since renting shifts risk to the company renting out the hardware, it stands to reason that renting will cost more than owning much of the time. So rent vs. own seems to come down to risk tolerance. Since a hot water heating is pretty small potatoes, risk-wise, it probably makes sense to buy.


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## Addy

So here's the deal with the hot water tank in our new house. It was installed in 2007, so it's 4 years old. It is a 50 gallon tank. The monthly rent is $23.99 + HST for a monthly total of $27.11. The buy out is $904 + HST for a total of $1,021.52.

This means it would take us living in the house just over three years to equal the monthly amount if we were to buy the tank out (if that makes sense!). We will be in our house most likely 3-4 years, so for us it's almost a moot point to rent or buy.

My husband and I can pretty much fix anything standard that breaks on a hot water tank, they are easy to fix for the most part. If it comes down to a major repair we would simply replace it. So that is a bit of a gamble, but considering we've never rented a hot water tank and have never had any major issues I'm not worried about the chance of a tank failure.

That said, I'm curious what others would do. I am tempted to remove the tank and have Direct Energy come and pick it up. I asked them to lower the monthly rate (after them insisting the previous owner should have disclosed that I am responsible for renting the tank from them... that really pissed me off!), but they would not budge.


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## andrewf

3 year payback? Sounds like a no-brainer to me.


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## Addy

andrewf said:


> 3 year payback? Sounds like a no-brainer to me.


But we will only be in our house 3-4 years.... and the rental does cover the (imho very very slim) chance of any repairs. So this is why I'm questioning it... if we were planning on staying in the house for longer then it would be a no-brainer. I'm honestly on the fence, except for the fact that I don't like renting!


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## MoneyGal

If it's a moot point, then just continue renting and forget about it. There is some hassle associated with buying (i.e., installation costs). In your shoes, that's what I'd do - I have enough other stuff to handle without adding to my plate if there's no real benefit to me. 

BTW, the buyout price will continue to decline over time and you may still hit break-even if you rent for a while and then decide to buy out later.


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## Four Pillars

I don't understand why you are on the fence. You've calculated that you probably won't live in the house much past the break-even point and renting gives you insurance from paying for repairs.

I agree with MG, but another approach is to just buy the thing and then forget about it. You aren't really losing either way.


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## andrewf

Installation costs? You're buying the tank that is already installed, so there should be no installation to speak of.


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## Four Pillars

andrewf said:


> Installation costs? You're buying the tank that is already installed, so there should be no installation to speak of.


MG is talking about buying a brand new heater and installing it. Ie if you can buy a new heater for less than the buyout quoted for the old heater, it might make sense to get a new one.


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## jamesbe

Is this enbridge? Tell them to take a hike and offer them $100 for the thing.

Man they are scam artists!!!!!

I just moved into my new home. Budget Propane was the renter of my HW tank. I asked how much the buyout was, they said it was in the home for 4 years therefore the buyout was $75. Chaching I wrote them a cheque.

I talked to them about how Enbridge wants to charge $1000+ for buyouts he told me, offer them a low amount if they don't take it, ask them to come get it, they will probably change their minds.

They will never install that tank in another home, so it's garbage to them. You can buy a new electric one for $400!


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## MoneyGal

Derp. A new tank will mos def be less than $904 (I just bought a new one last year). The question is whether new plus installation is cheaper than $904. 

My own personal behavioural bias is there's no way I'm going to buy something for more than it is worth. This is a four-year-old tank and the purchase price should be discounted for that fact. A new tank should be in the $700 range. Why are you going to pay $904 to buy a four-year-old tank - a $200 premium over new? It is a mystery.


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## Four Pillars

MoneyGal said:


> Derp. A new tank will mos def be less than $904 (I just bought a new one last year). The question is whether new plus installation is cheaper than $904.
> 
> My own personal behavioural bias is there's no way I'm going to buy something for more than it is worth. This is a four-year-old tank and the purchase price should be discounted for that fact. A new tank should be in the $700 range. Why are you going to pay $904 to buy a four-year-old tank - a $200 premium over new? It is a mystery.


And of course, this will change the break-even point since it is quite likely that Addy & Hubbie will install it themselves.

I calculate 2 years and 5 months if the new heater is $700 + HST.

As suggested - try to negotiate. Clearly $900 is not a great deal.


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## andrewf

Good point. If new is $~$800 (700+HST), I think after four years $450 - $500 would be a fair offer. See if you can get them to nibble by threatening to make them pick it up. If you can get it at that price, the ROI is very good. Alternately, see about getting them to reduce the rental amount per month.


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## nathan79

Strange, is it just hot water tanks that are rented or do people rent other appliances?

Reminds me, here in BC back in the 80's, most people rented their telephones from BC Tel. Never made much sense, but it was simply accepted as normal at the time.


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## jamesbe

Just hot water tanks. But it is mostly because the large gas and electric companies found a niche by installing them in new homes and charging rental without getting anyone to sign. People are so ignorant they think they are complicated devices that could burst at any point.


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## Karen

I'm still finding it bizarre that people rent hot water tanks. What happens when you move into a house that has a rented water heater in it - whether you're buying or renting the house? How can the gas or electricity companies hold you to a rental agreement that you did not sign? Surely you can just tell them that you don't want it, that you didn't enter into any agreement with them, and it would be up them to come and remove it at no charge to you?


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## MoneyGal

Yes, but if "everyone" rents water heaters, you just carry on with the agreement that "comes with the house." 

Believe me, I thought this was bizarre too, when I moved to Ontario from Alberta. I don't know what the rate of ownership vs. renting is here in Ontario, but I suspect it is fairly high.


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## jamesbe

Karen said:


> I'm still finding it bizarre that people rent hot water tanks. What happens when you move into a house that has a rented water heater in it - whether you're buying or renting the house? How can the gas or electricity companies hold you to a rental agreement that you did not sign? Surely you can just tell them that you don't want it, that you didn't enter into any agreement with them, and it would be up them to come and remove it at no charge to you?


Most people are sheep, so they just pay the bill that comes in without questioning. Non-sheep call them up and tell them to come get it.


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## Addy

Karen said:


> I'm still finding it bizarre that people rent hot water tanks. What happens when you move into a house that has a rented water heater in it - whether you're buying or renting the house? How can the gas or electricity companies hold you to a rental agreement that you did not sign? Surely you can just tell them that you don't want it, that you didn't enter into any agreement with them, and it would be up them to come and remove it at no charge to you?


I too find it difficult to understand why anyone would rent a hot water tank. I think it's fear-based. I doubt the gas (it's actually no longer the gas company, in Enbridge's case it's Energy Direct for the most part) company can hold you to a contract someone else has signed. Interestingly, when I phoned Direct Energy they made it very clear, without actually saying it, that I *was* responsible for the remainder of the contract, using words like "previous home owner is responsible for disclosing".... I called ED's rep bluff on that... and it really ticked me off, thinking they could bullshit me into thinking I was responsible!


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## MoneyGal

Addy said:


> I too find it difficult to understand why anyone would rent a hot water tank. I think it's fear-based.


Honestly. I don't think people put a lot of thought into this. It's just "what is always done." You move in, the rental bill arrives, you pay it. Just like you paid the rental bill at your last place of residence. I don't think people actually review the decision, and then decide, based on fear, that they are going to pay the bill without question...I think they skip an entire step and just pay the bill without question.


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## andrewf

I also think it is crazy that people spend $250/month+ on phone, internet and cable. Combined total for me is under $50, sans TV.


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## jamesbe

Yup, there's a good business opportunity. You can probably doupe most of the population by just sending them a bill for non-sense and they will pay it. So as long as you can hide offshore someplace to avoid the popo lol


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## Addy

andrewf said:


> I also think it is crazy that people spend $250/month+ on phone, internet and cable. Combined total for me is under $50, sans TV.


Amen brother! We're at $74 and change, including cable though.


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## DLS

*Water heater rental - new resident*

I recently moved into my first home, and I guess I didn't do all of my research (and boy was there a lot!) because I was quite surprised by the water heater rental fee. The previous owner never mentioned anything about it, and I guess I thought the company was supposed to give me information about the rental, which never occurred. So my first gas bill was the first time I saw anything about the water heater. Being a good little homeowner, I paid it, of course, and then started asking questions about the water heater. I decided that I would prefer a smaller water heater, as it would be cheaper and use less gas (as I live alone and don't use much water, this makes sense).

But the company (morEnergy) kept insisting that I had signed a contract giving me the rental (I never even _saw _a contract, let alone signed one), then they insisted that the previous owner sent my lawyer an 'assignment agreement' (which my lawyer never saw), and now they insist that because I paid my gas bill, I have agreed to the rental! Any advice for a new homeowner?


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## crazyjackcsa

I'd yank it out and tell them to come get it.


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## OhGreatGuru

From the Mor Enegy rental agreement:

_15. Sale of Residence – If you sell your residence, you agree to inform the purchaser that the Equipment is rented pursuant to this Agreement. You hereby authorize us to respond to information requests relating to your account made by or on behalf of the purchaser. You shall call the Customer Service billing phone number located on the dealer label affixed to your equipment to inform them of the sale and do all acts and sign all documents as we may require to give effect to the assignment of this Agreement to the purchaser._

If the previous owner didn't do this, it's not your problem.

If the company claims you signed a rental agreement or assignemnt, tell them to produce a copy.

I have heard however, that if you pay the bill without complaining, it may be considered an "implied acceptance" of the rental contract. I would suggest you send a registered letter to both the gas company and morEnergy telling hem you have not agreed to any rental contract.


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## crazyjackcsa

To me, it would be worth the fee and the hassle to tell them to take a hike. Yank it! Yank it hard!


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## carverman

crazyjackcsa said:


> I'd yank it out and tell them to come get it.


Absolutely! However, he has to go to a lawyer on the "assumed contract" that the "morEnergy" resellers(scam artists) have registered with the actual
gas supplier..because until you notify the gas supplier and give the hot water tank owner..a formal letter, the charges will still appear on his gas bill.

BTW...the real estate agent/former owner that sold him the property SHOULD HAVE DISCLOSED any RENTAL EQUIPMENT in the property listed for sale BEFORE HE SIGNED THE AGREEMENT TO BUY THAT PROPERTY!

If rental equipment on the property were not disclosed on the offer to purchase and INITIALED by the prospective buyer..
(I'm not a lawyer..but I would be seeking some kind of redress from the realestate realtor that listed the property, and the selling realtor, and maybe the closing lawyer, for not notifying you that there was a rental hot water heater on the property..where he could have made the decision right there and then....
to install his own (you can buy your own at Home-Depot or any independent gas contractor) and informed the owner (morEnergy) ...IN WRITING to take their rental tank away. 

Unfortunately, by paying the first month's rental fee,the new owner of the property is essentially "assuming the rental contract"..
but it can still be disputed..and IF it were me, and the rental company, refuses to release me without paying a substantial penalty..

I would be going after:

1. Listing office/agent
2. Seller of the property
3. Selling office/agent

and possibly my 

4. Closing lawyer

...in that order.

Tank rental can be significant over a 10 year period.
You can buy a gas water heater for around $357 (plus a
one time installation charge) at Home-Depot.


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