High Efficiency Water Heater

According to ENERGY STAR, a hot water heater accounts for 15% of home energy use. High efficiency hot water heaters, such as those with the ENERGY STAR label, can reduce energy use by 10-50%.

It is important to note that hot water heaters are measured for efficiency, and contain an EnergyGuide label. The higher the Energy Factor (EF), the more efficient the water heater.

There are several high efficiency water heater technologies available.

Tank Water Heaters

Tank hot water heaters store between 20 and 80 gallons of hot water. While a large supply of hot water is available at all times, it uses excess energy to keep the water hot, even when no water is being used. These have the lowest upfront cost, though an energy efficient tank hot water heater produces the fewest energy savings over time, because the storage tanks are by nature inefficient. According to ENERGY STAR, a high efficiency tank water heater could save $500 over the lifetime (8-10 years) of the equipment, since it is 10-20% more efficient than the baseline.

Tankless Water Heaters

Unlike a conventional tank-type hot water heater, tankless water heaters do not store water. They contain large coils capable of heating water "on-demand" and continuously as needed. This reduces the amount of energy used, because the water does not need to be kept hot at all times. However, there are limits to how much hot water the heater can supply at once.

According to ENERGY STAR, a high efficiency tankless water heater could save $1800 over the 20 year lifetime of the equipment, since it is 45-60% more efficient than the baseline.

Hybrid Water Heaters

Hybrid hot water heaters combine the positive attributes of both tank and tankless hot water heaters, making them both energy efficient and practical.

The following are three types of hybrid hot water heaters currently on the market:

1. GE GeoSpring

According to General Electric, the GeoSpring is the most efficient hot water heater on the market. GE reports that it is up to 62% more efficient than a standard hot water heater.

GE's GeoSpring provides the same amount of hot water as a standard water heater, but uses hybrid technology to reduce its energy consumption. Essentially, an evaporator draws ambient heat into the hot water heater, saving energy. See this video to learn how the GeoSpring works.

Also, the GeoSpring has multiple settings to optimize both energy efficiency and comfort. You can set the water heater to vacation mode, hybrid mode, high demand mode, and more.

The GeoSpring's MSRP is $1,399. GE says that the hybrid hot water heater will save $320 per year in energy costs - meaning it has a payback period of about 3 years.

However, you must also factor in that GeoSpring qualifies for state and utility rebates in almost 30 states. These savings could make the payback period much shorter. You can calculate your savings by using GE's GeoSpring Savings Tool. The calculator factors in the cost of electricity in your area and your local incentives and rebates.

2. A.O. Smith NEXT

A.O. Smith, one of the world's leading manufacturers of residential and commercial water heating equipment, offers the NEXT Hybrid Gas water heater (pictured). It is 90% thermal efficient and retails for close to $1500 on Amazon (though it may be eligible for tax rebates).

A.O. Smith touts NEXT as "the new milestone in water heating—built for the way people ACTUALLY live and use hot water" by combining the best features of tankless and traditional water heating technologies.

It does this by decreasing the standby losses associated with traditional tank-type water heaters (300 Btu/h compared to 700 Btu/h for a 50 gallon storage type gas water heater) and eliminating something called ‘cold water sandwiches’. These sandwiches they speak of are sudden interruptions in the hot water stream or ‘bursts of cold water’ occasionally delivered by instantaneous water heaters after there have been intermittent uses.

From the website, "The NEXT Hybrid water heater features a patented heat transfer process that utilizes a secondary heat exchanger to capture the heated flue gas from the tankless unit and route it back through a buffer tank to extract additional heat. The combined effort of the two technologies creates a superior, more energy-efficient performance."

3. State Water Heaters: Premier

State Water Heaters, a brand of State Industries, offers over 500 water heater products for residential and commercial applications.

It offers the Premier Hybrid Electric Heat Pump Water Heater, which is twice as efficient as a traditional electric water heater. Heat pump water heaters work by using electricity to take heat from the surrounding air and transfer it to the water.

The Premier is ENERGY STAR qualified, meaning that it meets or exceeds a variety of energy efficiency and performance requirements. According to the EPA, "ENERGY STAR qualified heat pump water heaters can save the average household almost $300 per year on its electric bills compared to a standard electric water heater".

The Premier is meant for residential applications and comes in both 60 and 80 gallon models. The 60-gallon model retails for $1820 on theenergyconscious.com, while the 80-gallon retails for close to $2700.

Solar Thermal Water Heaters

Solar thermal systems capture the sun’s energy by heating liquid (i.e. water), which can then be used to heat domestic hot water. Depending on your current energy sources, you could replace some of your natural gas, oil, or electricity needs with solar thermal.

According to ENERGY STAR, a solar thermal water heater could save $2000 over the 20 year lifetime of the equipment, since it uses 70-90% less energy than the baseline (since it replaces the energy source with solar thermal energy).

Heat Pump Water Heaters

Heat pump water heaters use electricity to move heat from the surrounding air to the water in the storage tank instead of heating the water directly. According to ENERGY STAR, a solar thermal water heater could save $900 over the 10 year lifetime of the equipment, since it uses 65% less energy than electric resistance water heaters.

Installing or Repairing Your Water Heater

If you are looking to install or repair your hot water heater, you will need to hire a water heater professional - it is not a do it yourself job.