Installing a solar
water heating system is your best bet.
It'll likely pay for itself in as little as seven years, and
after that your hot water will be essentially free. Pretty
much the only reason you shouldn't go solar is if you don't own
your own home so you can't. If the upfront cost scares you
(~$5200), just get a loan. And even if you're not planning
on staying in your current home long-term, any investment you
make in the solar system will increase the resale value of your
home. Mr. Electricity's family has been enjoying solar hot
water for years, and Mr. Electricity himself really enjoys no
longer being tethered to the gas company.
Barring installing a solar
heating system, your next best bet is to simply use less hot
water. That's our next topic...
Use less hot water in the first place
You'll get the most savings by
simply using less hot water. Outside of installing a
solar system, this is far and away the most effective way to
reduce your water heating costs. Here are your main
Wash your laundry in cold water. Modern
detergents don't need warm or hot water to get your clothes
clean. Washing in cold commonly saves $67/yr. with gas
heaters and $161/yr. with electric. (See
the calculator for your own situation.)
Install a low-flow showerhead.
Turn the water off in the shower while you're soaping up
or shampooing. This is a lot easier if you install
a cheap screw-in pushbutton switch, like those from Amazon
Take showers instead of baths.
Wash your hands with cold water. If your
faucet has a single handle, push it to the right to get only
cold water, rather than straight up which gives you a mixture
of hot and cold.
Fill water pitchers for the fridge with cold water.
for single-handle faucets, push it to the right for cold water
only, rather than straight up. Don't pay to heat up the
water and then pay to cool it down again with the fridge.
Repair any leaks. Hot water leaks waste energy
as well as water. One drip per second of hot water costs
you $2 to $4/mo. to heat water that you'll never use.
Get a more efficient water heater
Cheaper heaters cost less at the store, but you'll
pay more in utilities. Pay a little more for an
efficient model and you'll save in the long run. Here are
Note: Your own costs WILL
VARY according to how much hot water you use
and your local rates for fuel. See How
to Misquote this website. Assumptions:
Tank size ≤55 gallons. Annual energy
use from EPA.
Energy rates are 16¢/kWh and $1.42/therm. Prices
for units from Sears.com, 9/13, except Energy Star
Electric Tank from Whirlpool
and Lowes, Heat Pump from Home
Depot 1/16, and Solar from Univ. of Central FL
(+ heat pump heater cost). Payback ignores
delivery/installation costs because you'd have to
replace your old water heater sooner or later
anyway. Energy Factors from the Water Heater
Energy Factors table below.
Notes on the table:
Gas vs. Electric:
Gas is cheaper, but if you don't already have gas service,
getting it would likely wipe out any savings.
Heat Pump heaters:
These are cheaper to run than typical electric heaters, but
not gas heaters. If you have gas, keep it.
Solar: Solar is
great, and pretty much the only reason not to get solar is
that you don't own your own home. If the upfront cost
scares you, just got a loan. If you're wary because you
don't expect to be in your home long-term, remember that any
investment you make in solar will increase the resale value
of your home.
Gas is almost always cheaper than electric, whether tank or
tankless. For tanks, the energy cost is typically
about $30/mo. for gas vs. $42/mo. for electric. (EPA
If you're already a gas customer but have an electric water
heater, by all means, switch to gas now. However, if don't
already have a gas line serving your home, then switching from
electric to gas water heating often won't save any money,
because the cost of installing the gas line is high, plus you'll
have to start paying $12+/mo. to the utility just to be a gas
Electric tanks do offer some advantages over gas tanks:
Electric heaters are cheaper, because they're less
They're easier to install—no gas pipes required, no
They're safer (no fuel to leak or explode, no pilot
light to go out leaking gas into home, no combustion
If you don't have other gas appliances you can cancel
your gas service and save $12+/mo.
Electric tanks are actually more
efficient than gas tanks, because gas tanks constantly
lose heat through the venting flue (about 6°F per hour [source]
However, electric heaters cost more to run despite their
efficiency, because electricity is usually more expensive than
gas. (It's more expensive because power plant burns fossil
fuels to make electricity with only about 33%
efficiency, meaning 2/3 of the inputs are wasted.
When you heat with gas, you're heating directly, and cutting out
the middle man.)
Electric tankless units
cost as much or more to run as gas tanks.
Marketshare is 50% gas, 41%
electric, and the rest is mostly oil. Fuel type varies a
lot by state: in Florida, where it's warm and little
energy is needed for water heating, 90% of water heaters are
electric, since they're cheaper to purchase and install.
But in chilly New York, where more energy is needed to heat
water, only 12% of water heaters are electric, since running
electric heaters is pricey. (EIA
2005 p. 29, Consumer
Notes: While hybrid heaters are wildly
efficient, they're not cheaper to run than gas, because
gas is so cheap. While tankless heaters have high
efficiency, their high installation costs means they
typically don't pay for themselves. Figures
reflect 2004 federal standards. Pre-2004 models
were worse. (See source #3, and LBL's historical
averages.) Federal standards (non-Energy Star)
will get tighter in 2015. (DoE,
Sources: (1) Energy
Star site, accessed 9/13. (2) DoE PDF,
2008. (3) (DoE PDF,
There's a new kind of water
heater that extracts heat from the air to heat the water.
This works even when the air is relatively cold (down to
freezing). These are called either heat pump
water heaters or hybrid water heaters. (The
"hybrid" name is from the fact that there's a backup element to
heat the water by electricity when there's not enough heat in
Because hybrid heaters are so
efficient, it's now generally a better deal to install a solar
electric system to power a hybrid water heater, than it
is to install a solar water heating system to try to heat the
water directly with solar. (GBA)
If you want an electric water
heater >55 gallons, then current regulations
actually require that you use a hybrid heater. (DoE)
Note that if you want to put your hybrid heater in conditioned
space, then you'll want to duct it outside or to the attic so
it doesn't steal heat from the house in the winter.
Remember, hybrid heaters suck the heat out of the air, they make
the surrounding air colder. So that means either locating
it in unconditioned space (like an unconditioned garage,
basement, or attic), or else ducting it to a garage, attic,
basement, or outside, so it gets its heat from air that you're
not trying to heat by some other means. If you don't do
either of these, the penalty over a winter is about 800-2200
In the summer, letting your
hybrid take heat out of your home is a plus. Do
that by either installing the heater in conditioned space, or
ducting it to conditioned space. Savings on cooling over a
summer is up to 200 kWh, or $32 at 16¢/kWh. (DoE)
Hot Water Temperatures
Good for most uses. This is the temperature I
used before I had a family, and needed more hot water.
The temperature recommended by the Dept.
of Energy. This is the triangle setting on
the dial on many (all?) gas water heaters.
Bacteria from Legionnaires Disease can grow in water up
to 122°F, though authorities say the risk is small.
Water this hot will give you third-degree burns in 30
seconds. This is the "A" setting on the dial on
many (all?) gas water heaters.
Gives you serious burns in less than 5 seconds.
This is the "B" setting on the dial on many (all?) gas
water heaters. OSHA says you might want to run
your heater at this temp to kill bacteria; others crank
their heater up to 140°F just once a week which is
cheaper than running 140°F constantly. (I never
do.) Hotels, often deliver water to faucets at
this temperature, and have gotten a lot of flak for it
because of the danger of scalding. (AllStays.coml)
Third-degree burns in 2 seconds. 150° is the "C"
setting on the dial on many (all?) gas water heaters.
Third-degree burns in 1 second.
Third-degree burns instantaneously. This is the
"Very Hot" setting on the dial on many (all?) gas water
Solar water heaters can easily reach this temperature
even when it's below freezing outside.
(The system is typically set to stop heating well before
it gets to this level.) (YouTube)
When lowering the thermostat helps, and when it doesn't
Lowering the thermostat often
doesn't help that much, if at all. That's because
when the tank temp is lower, you'll simply draw more water from
it, so the energy required to heat the water you use is the
same. Here's an example: Let's say you want your bath to
be 104°F. If your tank is set to 104°F then you'll use
lots of tank water, without mixing in any cold. If your
tank is set to 140°F then you'll use only a little bit of tank
water, mixing in lots of cold. Either way, it's about the
same amount of energy to make a 104°F bath.
Same deal with your washing
machine and dishwasher. Any model made within the
last several years regulates the temperature. If your tank
is hot then it'll draw less water and mix in lots of cold, while
if it's not so hot then it will draw more hot water and mix in
less cold. Here again, the energy for heating the water
you use is about the same.
So here are the cases in which
lowering the temperature does save energy:
You're using a hybrid heater and you use a lot of hot
water. While hybrids are efficient, they can heat only
about 8 gallons an hour. If your hot water is
exhausted and you still need more, then the electric backup
will kick in, raising your bill.
You have an ancient washing machine which doesn't regulate
the temperature, and you frequently wash in hot or
warm. Of course, the better solution here is to simply
wash in cold.
You have an old dishwasher which doesn't regulate the
temperature. (And unlike your washing machine, dishes
should definitely be washed in hot water.)
Your heater is in an outside closet that's not sealed well
(either because it's gas and needs venting, or because the
closet is just old or poorly constructed), and your heater
doesn't have a water heater blanket.
The Department of Energy says that every 10° reduction saves
so for $25 of usage, lowering the temperature from 130°F to
120°F would save only about $1/mo. Lower it from 140° to
110°F (30° drop) then your savings are closer to $3/mo.
Remember, the savings is from only the usage part of
your bill, and a $40 gas bill might have $15 or so of customer
charges unrelated to how much gas you actually use.
a higher tank temperature mean higher standby losses?
Not really. We cover Standby Losses further down on this
potential problem with lower temperatures is that, at least in
Diseasebacteria could be encouraged to
breed. For that reason OSHA recommends maintaining the
temperature at 140°F, though DoE
says that 120°F is "considered safe for the majority of the
population", and it's what they recommend for most users.
Note that while 140°F reliably kills germs in gas tanks, they
can still survive in 40% of electric heaters set to
140°F since the
water at the bottom of the tank might not get that hot.
(Gas heaters kill the germs better, since the temperature in gas
heaters is more uniform.)
might look to you like a lose-lose situation: You
either run the risk of scalding with a high set temp, or the
risk of bacteria growth with a low set temp. But you
actually have a couple of options.
You can crank the heater up to 140°F once in a while,
rather than running it at 140°F constantly. I ran my
own tank for years at 105°, then I heard about
Legionnaire's, so I cranked it up to 140° for a few
hours. Not long after that I got a solar system, which
often gets the tank up to 150° on its own.
You can install a tempering
valve on the heater which mixes cold water with the
hot as it exits the heater, so you can have bacteria-frying
hot water in the heater, and safe levels of hot water at the
even after all this discussion about temperature, the truth is
that you can't really set the exact temperature of your heater
anyway, since gas heaters especially and electric
heaters to some extent operate on a range around the
temperature you set. One water heater manual says that if
you set it to 120°F, the possible range of temperatures at the
tap is 90°-150°F! (PDF,
What works best is using less
hot water, or upgrading to a more efficient heater. Here's
what doesn't work so well:
What doesn't save much money
Why it doesn't save much / any money
Lowering the tank
A 10°F reduction saves only around $1/mo.
When the tank temp. is higher, you use less tank
water. Nobody takes a 140°F bath.
Modern washing machines regulate the
temperature. If the incoming water is too hot,
the washer mixes in cold, using less overall hot
Standby losses aren't that great, because the water
in the tank usually gets used before it can lose much
Water heater blanket
Standby losses usually aren't that great.
Modern water heaters are already
well-insulated. The savings for older heaters
could be up to $4/mo (DOE),
but only $2/mo. for more modern (post-2004) heaters.(EPA)
There's no downside, and the $24 blanket will pay for
itself in about a year, but the savings aren't
Water heater timer
Standby losses usually aren't that
Tankless water heater
Gas tankless models save only $9-15/mo.
if you're lucky. Often there's no savings at all.
Tankless models cost $650 to $1650 more to
install than tank heaters.
Tankless heaters often promote water waste, increasing
water bills (see below).
Tankless heaters require more maintenance, which erases
Tankless water heaters: Mostly hype!
Tankless heaters purport to save
energy by having a greater portion of the fuel going to
heating the water, rather than being lost up the flue.
That's a nice sales pitch, but the truth is that the monetary
savings are meager, and the high upfront cost means that payback
time could easily be 20 to 40 years. Tankless heaters also
promote water waste, are more likely to break down, are more
expensive to repair when they do break, have shorter warranties,
and have other problems. For more, see my page Ten
reasons you don't want a tankless water heater.
losses is heat the water loses to the surrounding air while
sitting in the tank waiting to be used. This
includes heat lost through the walls of the tank ("jacket loss",
4.5%, or 2771 BTU over 24 hours), and for gas heaters, heat lost
up the flue stack (17.5%).(CEC, PDF,
2008, p. 42) Blankets, timers, and lowering the
tank temperature all try to save money by reducing standby
losses, but they don't actually save that much because modern
heaters are insulated well.
person measured the standby losses on an unused 120°F electric
tank, finding that they were 1.1 kWh/day (or 33
kWh/mo., which at 16¢/kWh is $5.28). That's significant,
but there still aren't much savings to be had here. If we
tried to save money by lowering the temperature, then we'd save
the whole $5.28 only if we dialed the temperature all the way
down to the room temperature, which of course defeats the whole
purpose of having a hot water heater. If we dialed it down to
106°, we'd save considerably less than $5.28/mo., which isn't
the room temperature was 75°F in the above test, then
that's 0.61 kWh per degree-F. Lowering the tank
temperature from 140°F to 110°F would thus be 30°F x 0.61 kWh =
18.3 kWh saved per month. (I know, heat loss isn't
perfectly linear, but it's close enough.) At 16¢/kWh,
for water heaters are hard to find. (Many
manufacturers don't publish them, preferring to instead
communicate overall efficiency through the Energy Guide
label.) But here are some from Bradford
How much hot water leaks cost you
To calculate this I painstakingly spent almost twenty
minutes counting how many drips it took to fill a half-cup
measuring cup. (539 drips, thank you very much.)
Man, what I do for my readers. Anyway, from there the math
is simple. Here's how much water per month is wasted at
various drip rates, along with how much this costs you for
energy, assuming $1.42 per therm for gas and $0.16/kWh for
electricity, and not considering the cost of the water itself.
3 drips per second: 457 gallons/mo. ($5.78/mo.
gas; $12.14/mo. electric)
2 drips per second: 305 gallons/mo. ($3.87/mo.
gas; $8.10/mo. electric)
1 drip per second: 152 gallons/mo.
($1.98/mo. gas; $4.05/mo. electric)
Note that this differs sharply from the figures given by the
Illinois Rural Water Association (PDF).
are much lower.) But since I counted out every drop
myself, I'm confident in my numbers. Besides, IRWA doesn't
say how they arrived at their figures. For all we know,
they read them in the National Enquirer or overheard some
crackheads spouting those figures in some back alley
somewhere. Fortunately, my numbers are indeed close to
those put out by the U.S.
Survey. I get 17,248 drips per gallon, they get
More tips for saving money with a standard tank heater
Here are some additional tips
for those who want to eke out even more savings:
your old heater in a special tank blanket, available
from your friendly home improvement store.
The savings for older heaters could be up to $4/mo (DOE),
but only $2/mo. for more modern (post-2004) heaters.(EPA)
There's no downside, and the $24 blanket will pay for itself
in about a year.
Use a water heater timer on older (pre-2004) heaters.
A timer turns off your heater automatically when you go to
work, then back on right before you come home, off after you
go to bed, and on again right before you get up. They're
available for both electric and gas models. They don't
save as much money as you'd expect, though. That's
because standby losses just aren't that great. A typical
electric water heater only runs about three hours a day
anyway, and modern energy-efficient water heaters run only 1.3
hours or so.
A timer for an old electric heater costs around $40 and saves
about 25kWh/mo. for a family of two using 40 gallons a day
with the heater off four to six hours a day, but only
14kWh/mo. for a family of four using 80 gallons a day. (Florida
Service) A gas
heater timer goes for about $110, and is
user-installable. (See our separate page on how
install a water heater timer.)
Insulate your hot water pipes.
Your home improvement store sells insulation that simply
fits around the pipes. This is an easy do-it-yourself
Insulate the room where the heater
is. The colder the environment where the
heater is, the higher the standby losses. And the heater
it's in a garage and it's cold outside, keep the garage door
Take advantage of utility
promotions. Some utility companies like Dakota
Electric will install a special water heater which heats
primarily at night for a lower kWh rate. (In Dakota Electric's
case, only 3¢ per kWh.)
Turn it off when you're out of
town. For electric heaters without a
switch, you can turn it off at the breaker box. For gas
heaters, follow the instructions printed on the heater.
(Usually you can just turn the thermostat, NOT the gas knob,
to OFF unless it's an electric-ignition model or you feel
you're competent to re-light the heater when you return.)
Install a drain recovery system.
A drain recovery system uses the heat from the water flowing
down the drain to preheat water entering the heater. A
system like the one by GFX
saves $180 to $340 a year when used with an electric water
heater according to the manufacturer, and prices start at
$334. These are really only suitable for homes with
basements or bathrooms on the second floor, because access to
a vertical drainpipe is needed.
If your water heater gives up the ghost then obviously
your first call should be to the professional installer you
used. If you bought a tankless model on Amazon and used
some fly-by-night installer who's no longer around, then contact
the manufacturer and ask them who's authorized to work on
heaters in your area. For example, in all of Austin, Texas
there's only one certified Rheem installer. When my Rheem
heater died, Rheem shipped the new parts for free and paid for
the repair, since there was a known problem with the model I
If you want to try to fix your heater yourself (or do some
preventive maintenance), here are some good pages:
The pilot light in a gas tank
water heater uses about 3.3 to 4.2 therms/mo. (source)
2015 efficiency standards
federal standards for water heater efficiency kicked in on
April 16, 2015. For tanks that are 55
gallons or less (which is most of them), new heaters
will be about 4% more efficient on average, and will need only
an inch or two more space. However, for some
homeowners that inch or two will mean that their water heater
closet has to be enlarged to meet local building codes.
Check with your city on that one.
For tanks >55 gallons, the requirements are so strict that
your new heater will incorporate new technology: