Choosing a Hot Water Heater
Calculators, Green Home, Interior, Plumbing by Joe Cuhaj
Heating water is the second largest single user of energy in the home. While we all enjoy a soothing hot shower, rising energy costs—along with their adverse environmental impact—make it a good time to take a closer look at the various options now available.
Types of Water Heaters
- Storage: The most common hot water system used in homes. Water is kept constantly heated in the storage tank by electricity, natural gas, oil, or propane. Hot water is drawn out of the top of the tank when a faucet is turned on and cold water flows in the bottom to replace it.
- Tankless: Also known as demand or instantaneous water heaters. Water is heated instantly by electricity or gas when water flows through it.
- Solar: Water is circulated from the tank through a solar collector where it is heated by the sun. If the water in the tank is not hot enough, a conventional water heater is used to bring it up to the desired temperature.
Decisions, Decisions
So which type of water heater is right for your home? There are several factors to consider including the price of the system and installation, the cost and availability of energy sources, and the energy factor (EF) rating of the water heater.
EF ratings were established by the U.S. Department of Energy to compare the energy efficiency of various products. The EF scale for water heaters runs from a low of 0.5 for gas storage tank heaters to 2.0 for electric heat pump models. The higher the EF, the more efficient the water heater. The EF number takes into account:
- Recovery Efficiency: How efficiently the heat is applied to the water.
- Standby Loss: The percentage of heat loss per hour of the stored water.
- Cycling Loss: The loss of heat as the water circulates through the unit.
Energy Cost Calculator
Most water heaters run on either electricity, natural gas, or propane. Since energy prices can vary widely, fill in the values in the calculator below to compare energy costs in your area. While the actual amount spent will depend on how much hot water you use, the calculator will give a comparison between the various energy sources available. Preset values in the calculator represent average EF rating and energy prices in the U.S. for 2006.
On average in the U.S. in 2006, it cost 1/3 more to heat water with electricity than natural gas. Propane was the most expensive of all at 50% more than gas.
Pros and Cons
Here are some of the advantages and disadvantages of the most common types of water heaters:
Storage Heaters
- Inexpensive and widely available in a variety of sizes.
- Waste 10%-15% of energy through radiant heat loss.
- Can run out of hot water during extended use.
- Life expectancy 10-15 years.
- Average EF rating 0.67.
- Cost $200-$400 plus installation.
Tankless Heaters
- Take up little space and can be mounted inside or on an outside wall.
- Little or no standby energy loss.
- Use 20% to 30% less energy than comparable storage tank models.
- Hot water flow rate is limited by the size of the unit.
- Can be expensive and costly to install.
- Life expectancy 20 or more years
- Average EF rating 0.75.
- Whole house tankless systems cost from $600-$1000 or more plus installation.
Solar Heaters
- Low to no energy cost.
- Savings can pay for the unit in 8-12 years.
- Requires the collector to be in full sun throughout the year.
- Expensive and costly to install.
- Usually use a conventional water heater for backup.
- Life expectancy 20 or more years.
- Do-it-yourself kits are available for $2,000. Professionally installed systems run $5,000-$7,000.
Going Tankless
Available in both electric and gas models, tankless water heaters are considered more energy efficient than storage tanks but cost substantially more to buy and install. Gas tankless water heaters often require a larger gas line and modifications to the vent pipe while large tankless electric models may draw more current than the house is designed to handle. The extra expense may be offset somewhat by a $300 federal tax credit for gas models with a minimum 0.80 EF rating that are purchased in 2006 or 2007.
Small single use electric units are less expensive and can be mounted under a sink. They come in handy if you have a half bath or kitchen sink located away from the main hot water heater. Rather than wasting water waiting for it to get hot, the tankless heater will supply hot water right away.
Be sure and check the recommended flow rate on tankless water heaters to see if it is enough to meet your needs. While they won’t run out of hot water like traditional storage tanks, multiple users can exceed the flow rate and cause the water temperature to drop.
Here Comes the Sun
The collector on a solar water heater needs to be located where it will receive full sunlight throughout the day. For maximum efficiency it should face south and be tilted at an angle equal to the latitude. Solar water heaters will work at a lower slant or when facing southeast or southwest, though not as effectively.
Solar hot water heaters use either natural circulation or a pump to move water between the collector and storage tank. Some systems circulate the water from the storage tank through the collector while others use a heat exchanger in the tank to keep the fluid in the collector separate from the water in the tank.
Though expensive to buy and install, solar water heaters are eligible for up to a $2,000 federal tax credit through 2008.
Energy Efficiency Payback
To find out how long it would take an energy efficient system to earn back its added expense, divide the additional cost of the energy efficient system by the yearly savings in energy. The answer is the number of years it would take the energy efficient system to pay for itself.
$ added cost ÷ $ saved in energy a year = years to payback
Online Resources
- US Department of Energy: Selecting a New Water Heater
- American Council for an Energy Efficient Economy: Water Heating
Tankless Systems
Solar Systems
- Solar Rating and Certification Corporation
- Solar Smart Water Heating Systems
- Hot2o DIY Solar Hot Water Heater
- Velux Solar Water Heating Systems
6 Comments on “Choosing a Hot Water Heater”
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September 24th, 2007 at 12:31 pm
Solar water heating paybacks are more in the range of 3 to 6 years with the 30% federal income tax credit factored in. Starting in 2008 Louisiana is offering a 50% income tax credit for solar water heater costs on top of the federal tax credit (80% total).
Ben Erickson Says:September 25th, 2007 at 9:24 am
Lee,
Thanks for your input. While the tax credit for solar is mentioned in the article, it wasn’t included in the payback calculations since not everyone will qualify if they don’t owe enough in taxes to take advantage of the credit.
July 19th, 2008 at 6:30 pm
i am glad you , at lest started to open the door about heat pump hot water heaters ,
i do distribute a product called the Nyletherm-1 ,here in Canada , but made in Maine U.S.A. by Nyle Special Products .
i would like to add , that my research states that a 40 gallon tank ele.hot water tank uses 12.8 amps of power , and a 60 gallon tank uses 16.0 amps of power ,
now with a nyletherm-1 ,domestic hot water heat pump that uses only 4.7 amps of power when used with the same two tanks discribed above .
thats 2/3 savings per/year on the 40 gallon,and 3/4 savings on the 60 gallon .
15 year warrenty and 3-4 year pay back , and it dehumidifies 1 quart / hour as it runs .
about 4 hrs for a 60 gallon , it also makes A/C about 6000btu’s worth or a temp drop of 1degree in a 15×20 space nominal even in winter , as most systems are installed near or in furnace rooms taking advantage of waste residual heat from that type of equipment. thank you very much and if you send me your questions at my web site , and your return email i will do my best to answer. heatpumpproducts.com
December 27th, 2008 at 1:49 pm
So many tank-type water heaters do not have drain valves in them today for some reason… and yet, all of the DIY sites tell you at some point to access your drain valve to help drain the tank and do routine service. Arg! How aggravating! AND most water heater sites do not mention that today’s water heaters may not have a drain. Is this a conspiracy to make us have to buy a whole new water heater rather than perform simple routine maintenance?
November 18th, 2009 at 1:59 pm
I have a 40 gallon water heater that shuts off when it reaches the desired temperature. It runs on propane. When it is heating the water in the tank, for some reason my stove flame is very low. When the water heater shuts off, the stove flame goes back to normal. Is this caused by the water heater? By replacing the water heater, will the stove function normally?
Ben Erickson Says:November 19th, 2009 at 10:08 am
Ray,
Since a gas hot water heater uses a lot of gas when it’s running, it sounds like to me that either the water heater shares an undersized gas line with your stove or the line running to your stove isn’t large enough to provide enough gas when the water heater is running.