The average water heater lasts about 8 to 12 years and accounts for roughly 15 to 20 percent of your utility bill. So if your heater is getting along in years, or if you’re adding or upgrading a bathroom, remember the three cardinal rules of shopping for a standard storage water heater: Don’t rush, size matters, and energy efficiency matters more.
Admittedly, an ice-cold shower or a leaking heater makes it more urgent to get a new heater hooked up quickly. But if you choose one based solely on the speed of delivery, you may end up with a unit that can’t keep up with demand, costs more to operate, and fails sooner than it should.
Understanding Water Heater Basics
Water heaters are essential appliances that provide hot water for various household needs, from showers to dishwashing. They come in different types, sizes, and fuel options, each with its own set of advantages. The key to selecting the right water heater is understanding your household’s hot water demands and balancing that with energy efficiency and cost considerations.
When choosing a water heater, it’s important to look beyond just the upfront cost. Factors such as energy efficiency, fuel type, and maintenance requirements can significantly impact the long-term expenses and performance of your unit. Additionally, considering the installation space and local building codes is crucial for a successful setup.
Hot Water Heater Sizes
Even if you were happy with the old tank, don’t automatically assume it had a suitable heating capacity. To determine that capacity, you first need to add up how much hot water your household uses during the busiest hour of an average day. “Size a water heater for your demand 363 days a year, not the one or two days that you’ve got 25 relatives visiting,” says Richard Trethewey, This Old House plumbing and heating expert. “Otherwise, you’ll end up with an energy-gobbling beast in the basement.”
This sum — your household’s “peak-hour demand” for hot water — should be close to your water heater’s “first-hour rating” (FHR) printed on each heater’s yellow Energy Guide label. The FHR tells you how many gallons of hot water a heater can produce during an hour of high usage. (It is not the same as the number of gallons a tank can hold.)
Hot Water Heater Assess Efficiency
The following number to look at is the energy factor (EF), representing the percentage of energy that is turned into hot water by that specific model. The higher the number, the more efficient the unit and the less it will cost to operate. (An EF of 1 would indicate that 100 percent of the energy a heater uses is converted into hot water — a physical impossibility, alas.)
While a high EF is good, you have to factor in the cost of the energy the heater uses to get an accurate picture of how much it costs to operate. In most areas, for example, an electric heater with an EF of 0.8 will cost more to run than a similar-size gas model with an EF of 0.6 due to the higher price of electricity compared with gas.
In most cases, water heaters with high EFs cost more to buy but don’t overlook the potential long-term savings in fuel costs. Here’s an easy formula to calculate the payback period when comparing heaters with the same FHR rating but different prices: Divide the difference between the prices of the two models by the difference between their estimated annual operating costs (printed on the Energy Guide labels). The result is the number of years it will take the energy savings to offset the higher purchase price. Look for a payback within ten years, the expected life span of an average heater. Of course, if energy prices go up during that time, the payback period will be shorter.
Keep in mind that the estimated annual operating cost is just an approximation. To more accurately predict performance and payback time, plug each model’s EF and your actual energy cost into the online worksheets provided by GAMA.
Comparing Types of Hot Water Heaters
When comparing the different types of heaters, you’ll see that gas and oil-fired units generally have higher FHRs, relative to their tank size than electric models. (Flames heat water more quickly than heating elements do.) If you come up with a high FHR on your worksheet, say 100 gallons or so, you may need to install a second water heater.
Storage Tank Water Heaters
Storage tank water heaters are the most common type found in homes. They consist of an insulated tank that holds and heats water until it’s needed. These units are available in various sizes and can be powered by electricity, natural gas, or oil.
Pros:
- Lower upfront cost
- Simple installation
- Variety of sizes available
Cons:
- Higher energy consumption due to standby heat loss
- Limited hot water supply based on tank size
Tankless Water Heaters
Tankless water heaters, also known as on-demand water heaters, heat water directly as it flows through the device. They don’t store hot water, which eliminates standby energy losses associated with storage tanks.
Pros:
- Energy-efficient
- Endless supply of hot water
- Compact size
Cons:
- Higher upfront cost
- May require upgrades to the home’s electrical system or gas line
Heat Pump Water Heaters
Heat pump water heaters use electricity to move heat from the air or ground to heat water, rather than generating heat directly. They can be two to three times more energy-efficient than conventional electric resistance water heaters.
Pros:
- Highly energy-efficient
- Lower operating costs
Cons:
- Higher upfront cost
- Require specific installation conditions (adequate space and air temperature)
Solar Water Heaters
Solar water heaters use the sun’s energy to heat water. They typically include a storage tank and solar collectors. These systems can be a great option in sunny climates and for those looking to reduce their carbon footprint.
Pros:
- Very low operating costs
- Environmentally friendly
Cons:
- High initial investment
- Dependent on climate and sun exposure
- May require a backup system for cloudy days
Comparing Water Heater Fuel Types
The type of fuel your water heater uses significantly impacts its efficiency, operating costs, and environmental impact.
Electric Water Heaters
Electric water heaters are known for their high efficiency and quiet operation. They’re available in both tank and tankless models.
Pros:
- High-efficiency ratings
- No venting required
- Can be installed almost anywhere
Cons:
- Higher operating costs in most areas due to electricity prices
- Slower recovery rate compared to gas models
Gas Water Heaters
Gas water heaters, fueled by natural gas or propane, typically have lower operating costs than electric models in most regions.
Pros:
- Lower operating costs in most areas
- Faster recovery rate
- Can operate during power outages
Cons:
- Require proper venting
- Slightly lower efficiency than electric models
- Potential safety concerns with gas leaks
Oil-Fired Water Heaters
Oil-fired water heaters are less common but can be an option in areas where oil is a primary heating fuel.
Pros:
- Heat water faster than electric or gas units
- Good option where natural gas isn’t available
Cons:
- Higher operating costs due to oil prices
- Require more maintenance
- Less environmentally friendly
Performance Features of a Hot Water Heater
After determining a heater’s size and efficiency rating, consider these other important factors that increase longevity and reduce operating costs.
Tank material
The typical tank is steel lined with “glass” (actually porcelain enamel). It contains magnesium or aluminum rods suspended in the tank to fight internal corrosion, which is the number-one reason water heaters fail early. Stainless steel tanks don’t rust (and therefore don’t need anodes), but they’re more expensive than glass-lined tanks. Their higher cost may be worth it in areas where the water is highly corrosive (acidic) or reactive (full of minerals that encrust the tank walls, slowing heat transfer).
Insulation
Whether foam or fiberglass, the insulation surrounding a gas- or oil-fired tank should be R-16 or higher and R-22 or more for electric. Insulation reduces standby losses — heat that escapes while the unit is idle. Wrapping your tank in a fiberglass blanket won’t make up for insufficient insulation built into the tank.
Heat traps
These built-in devices — either valves or flexible connectors bent into an inverted U — put a stop to “thermosyphoning,” the tendency for hot water to rise up the supply pipe. If your water heater doesn’t have one built-in, a heat trap can be added during installation (or retrofitted to existing heaters).
Making Your Selection
Factor in warranties and the manufacturer’s reputation before making your purchase. There’s no single source to turn to for this information; talking to a few reputable plumbers and plumbing supply stores should help you narrow the choices. Also, when considering the price of installing a water heater, you may be able to take advantage of rebates or incentives offered by local utilities and municipalities to encourage the purchase of energy-efficient models. (Check www.dsireusa.org for state-by-state listings.) Finally, make sure the heater you’ve chosen will fit in the available space and still leave enough room for servicing.
Once you’re ready to buy, your plumber should be able to order the model you want. Or, you may be able to buy directly from a local home center. In either case, professional installation will take about one to three hours; be sure it includes the cost to remove and dispose of the old heater.
Water Heater Installation Considerations
There are two options for water heater installations: DIY and professional.
DIY vs. Professional Installation
While some homeowners may be tempted to install a water heater themselves, professional installation is often the safer and more efficient choice. Professional installers can ensure proper venting, fuel line connections, and compliance with local building codes.
Space Requirements and Accessibility
Consider the physical space where your water heater will be installed. Ensure there’s enough room for the unit and any required clearances for maintenance. For gas and oil heaters, proper ventilation is crucial for safety.
Water Heater Maintenance
A water heater can last 30 years, but most fail in about 10, due mainly to neglect. Perform the following tasks annually, or hire a plumber or HVAC professional to do them, and you’ll save your heater from premature death.
- Drain the tank until the water runs clear. If there’s lots of sediment, drain the tank twice a year.
- Inspect the pressure-relief valve for corrosion. If rusty, have a plumber replace it right away.
- Check the combustion chamber and flue vent for rust, corrosion, and obstructions on gas or oil-fired unit. On an electric heater, remove and check heating elements, but shut off the power and drain the tank.
- Remove and inspect anode rod (or rods). Replace if 6 inches or rods of the rod’s core wire are exposed.
- Keep water temperature between 120 and 130 degrees. (Check with a thermometer under the tap.) Higher temperatures speed corrosion.
Cost Analysis of a Water Heater
Understanding the full cost of a water heater involves more than just the purchase price.
All price information is sourced from Angi.
Initial Purchase Costs
Water heater prices can range from $880 to $1,800 depending on the type, size, and features. Tankless and solar models typically have higher upfront costs than traditional tank models.
Long-Term Operating Expenses
Consider the estimated annual operating costs provided on the Energy Guide label. More efficient models may cost more upfront but can lead to significant savings over time.
Potential Rebates and Incentives
Check for rebates or incentives offered by local utilities or government agencies for energy-efficient water heaters. These can help offset the initial cost of more efficient models.
Our Conclusion
Choosing the right water heater involves balancing your household’s hot water needs with energy efficiency and long-term costs. While the initial price is important, don’t overlook the impact of energy efficiency on your utility bills over the life of the unit.
Consider your household size, hot water usage patterns, and available fuel types when making your decision. Whether you opt for a traditional tank model or a more advanced tankless or heat pump system, proper sizing and professional installation will ensure you get the most out of your investment. Remember, regular maintenance is key to maximizing the lifespan and efficiency of your chosen water heater.
Where to Find It
Electric:
American Water Heater Company
Johnson City, TN
800-999-9515
www.americanwaterheater.com
Gas-fired:
American Water Heater Company
Oil-fired:
Bock Water Heaters
Madison, WI
800-794-2491
www.bockwaterheaters.com
Our thanks to:
Dave Sutula
Gas Appliance Manufacturers Association (GAMA)
Arlington, VA
703-525-7060
