Thrifty Thinking: Why Buying a New Water Heater will Save You Money

By Jennifer Tuohy

It’s a mother’s worst nightmare—you have a bathroom full of filthy children following an afternoon of soccer/playground/general rolling around in mud. You turn on the tap and wait. And wait. There’s no hot water!

Fret not—once you get past the initial discomfort and probable sticker shock of the new water heater you’ll have to spring for, things may actually start looking up. How is that? Because brand new efficiency standards for water heaters mean that big hunk of metal is about to save you a bundle of cash.

On April 16, 2015, new Department of Energy requirements went into effect that require all water heaters built after that date to decrease their energy use by up to 47% (for the largest, most inefficient water heaters). Considering that heating water accounts for the second biggest energy use in the home (after heating and cooling) and costs the average American household between $400 and $600 annually, if you buy a new water heater today, you may see a dramatic drop in your energy bill.

 

What’s New About Water Heaters?

The new requirements, which are part of the National Appliance Energy Conservation Act (NAECA) Standards, require that all water heaters built after April 2015 have higher Energy Factors; the EF is the unit used to measure the water heater’s overall efficiency. According to the DOE, increasing the EF of water heaters from .88 EF to 2.0 EF for heaters over 56 gallons, and to 0.95 EF for smaller water heaters (55 gal or less), will not only help consumers save $63 billion in energy bills between 2015 and 2044, but will eliminate the equivalent carbon dioxide emissions from our atmosphere of removing 33.8 million cars from the roads for a year.

So, your new water heater is not only helping save you money, but it’s also helping save the planet for those dirty rug rats.

The new guidelines apply to both storage water heaters (those with a tank) and instantaneous water heaters (also known as “tankless”), although most tankless water heaters already met the efficiency guidelines. Most small water heaters weren’t too far off either—it’s the big, household water heaters that are 56 gallons or over (the one you need if you have a lot of kids or a big house), that will see the most significant cost savings. That’s because, in order to meet the new guidelines, manufacturers have had to incorporate heat pump technology that uses energy produced by the water heater itself to help heat the water. This can reduce the energy you need to take from the power grid to the tune of about $300 a year (or $100 on a gas bill if your water heater is gas powered).

How Will This Affect Me?

This is great news if you are in the market for a new water heater. Now, you have the option of sticking with electric (rather than the gas that many tankless models require), saving money and helping save the plant. It’s a win, win, win!

Jennifer Tuohy writes on energy-efficient, budget-saving techniques around the home for Home Depot. You can view the home water heater styles Jennifer discusses in her article on the Home Depot website.