If customers want to save some money on their energy bill, be prepared to explain the various options


Water heater replacement often happens because the current heater is not working or, worse yet, leaking. The goal is to get a new unit in place ASAP — not a time for comparison shopping. Even though water heating can account for 14 to 18 percent of a household's energy bill, most homeowners are not aware of the energy-efficient products that can reduce the monthly hit on their budget. But if some of your customers are interested in saving energy on water heating, here is information you can provide them.  

There are plenty of residential-grade options for replacing standard storage-type water heaters, including efficient gas or electric water heaters, hybrid heat-pump water heaters and others.

Read the Label

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The Energy Guide label on each unit shows at a glance how much energy the heater will use. It is a good way to compare the products of different companies or different models from the same company, especially if your customer wants to stick with a standard storage tank water heater. The label provides the following:

  • An estimate of what it will cost to run the unit for a year. The cost is on a scale that shows how a particular water heater compares to similar models in terms of cost.
  • An estimate of the amount of energy the water heater will use in a year.
  • The capacity of the first-hour rating. This is not the number of gallons the tank can hold, but how much hot water the unit will provide during a set period. Think of what happens first thing in the morning. The water in the heater is at its set temperature. Then people start using the hot water. As they do, cold water rushes into the tank, mixing with the remaining hot water. The water heater senses a drop in water temperature and clicks on. All at once, hot water leaves, cold water enters and the unit is trying to keep up with the changes. The rating can help determine the size heater needed based on peak demand.

The unit's energy factor (EF) helps determine the estimated costs on the label. This number reflects the efficiency of the heater in converting fuel — natural gas, propane and the like — into hot water. The EF is expressed as a decimal. An EF of 1.0 means that 100 percent of the energy is converted to hot water.

The label may have the Energy Star logo on it if the product qualifies. Energy Star is a voluntary program of the Environmental Protection Agency. Energy Star products are more energy efficient than standard products.

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Type of Water Heater Minimum EF Requirements Energy Star EF Requirements
50-gallon gas water heater 0.6 >0.67
50-gallon electric water heater 0.95 >2
Tankless water heater 0.82 >0.9

Heat Pump Water Heaters

A heat pump water heater, sometimes called a hybrid water heater, is a good option if the goal is to switch out a standard tank heater with one that is as energy efficient as possible. These units look similar to standard water heaters except there is a heat pump mounted on top of the unit.

Heat pumps remove heat from the air, even cool air, and with the help of an evaporator, a compressor and condenser coils uses that heat to heat the water in the tank. When it cannot handle the demand, the unit switches to standard electricity. Heat pump water heaters use less than half the electricity of a standard electric water heater. Your customers will pay higher up-front costs for a heat pump model. But according to Energy Star, the savings in monthly bills will pay for the higher cost in about 2 1/2 years. They can save $3,440 in electric bills over the life of the unit.

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From your standpoint, installing one is similar to installing a standard electric heater. But there are a few things to keep in mind.

  • Heat pumps operate within a set temperature range — 35 to 120 degrees, for example.
  • Because they operate by pulling air into the unit, there are clearance and ventilation requirements.
  • You will need to deal with the condensate that the heat pump produces.
  • There must be enough clearance above the unit so that the filter can be removed and cleaned.

Federal tax credits and rebates expired for heat pump water heaters at the end of 2016, but your customers may qualify for local rebates from utility companies. You can search for rebates by zip code here.

Tankless Water Heaters

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Installing a tankless water heater goes beyond simply switching out a similar type, but they are an option worth considering. They offer the advantage of not needing to keep water at about 120 degrees when no one is using hot water. The Department of Energy estimates that if a family uses less than 41 gallons of hot water a day, a tankless on-demand heater is between 24 and 34 percent more energy efficient than a heater with a conventional storage tank. They are 8 to 14 percent more efficient if the family uses more than 41 gallons of hot water.

Unlike conventional water heaters that are sized based on the number of gallons the tank holds, tankless heaters are rated by the number of gallons of hot water they produce per minute. This is where finding the right size unit can get tricky. You have to estimate the peak hot water demand. Talk with your customer to figure out their daily needs. If it's not unusual for someone to be in the shower while there is a load of clothes in the washer, they will need a unit that can produce the hot water necessary to run both the shower and the washer at the same time. You can also discuss the customer’s needs with a product manufacturer's representative. Here are some average hot water demand estimates, according to Energy Star:

Fixture gpm
Shower and Bathtub 2.5
Clothes Washer 3.3
Kitchen and Bathroom Sinks 2.2
Dishwasher 1.3

You will also need to consider how much the heater will need to raise the temperature of the incoming water. The temperature of incoming water varies across the country — from an average of 35 to 40 degrees in the North to 65 to 70 degrees in the South. The difference between the incoming cold water and the hot water used, which is usually around 120 degrees, is the temperature rise. The maximum gpm for a unit may be 8 or 9 gpm, but if the unit must raise the temperature 70 degrees, the effective gpm could be cut in half. The manufacturer's literature will provide gpm at different incoming water temperatures.

Other Options

There are other energy-efficient technologies available, but they involve extensive changes to the plumbing and venting system. They include:

  • Condensing water heaters. These are available in both tank and tankless models and are powered by gas. These units use some of the hot gases created during the combustion process to heat the water rather than venting all of the gas to the outside.
  • Indirect water heaters. In these systems, the water heater storage tank is connected to a boiler or furnace. The heating unit heats a fluid that is circulated to the storage tank where a heat exchanger heats the water.
  • Solar water heaters. These circulate a fluid through roof top solar collectors. The fluid heats the water in the storage tank.

As the plumbing expert, you can help your customers graduate from standard-type water heaters to more energy-efficient products.

About the Author
Fran Donegan writes home- and garden-related content for numerous digital and print publications. He is the author of the books Pools and Spas and Paint Your Home. Donegan also writes for The Home Depot, which offers a wide selection of water heaters.


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