Monday, December 20, 2010

Need to Replace your Water Heater?

Appliance Buying Guide: Water Heaters


When it’s time to replace your water heater, you’ll find a wide array of high-efficiency models offering big energy savings.


Since hot water accounts for as much as 25% of your home’s energy use, when your water heater dies, the replacement you choose will have a big impact on your monthly bills. New technologies make many of today’s models far more energy efficient than that old tank you’re getting rid of. Some of the greenest options are tankless units that heat water on demand, but even conventional water heaters—the classic metal cylinders that are by far the most popular in the U.S.—have gotten less expensive to operate.

Water heater basics

Most households need a 50-gallon tank, according to Jeff Haney, a product manager at manufacturer Rheem. That’ll cost $900 to $2,000, installed, depending on which model you choose. Your plumber will put it where the old tank was, with the cold water supply pipe attached at the bottom of the tank and a hot water outlet pipe on top.

Inside the tank, a thermostat constantly assesses the water temperature and fires up a heating mechanism when it falls below the desired setting (120 degrees is standard). When you turn on a hot water tap, heated water flows from the tank and gets replaced by more cold
water from the supply line below.

To do this work, water heaters use electricity, oil, or natural gas. Choosing a new water heater that uses the same fuel type as your old unit is the easiest way to keep replacement costs down, says contractor Andy Wargo of Marcellus, N.Y.

What to look for on the label

Within each fuel type, you’ll find a range of models and price points. To compare, look for these key differences, marked right on the label:

First Hour Rating is a measure of how many gallons the unit can produce in one hour (which is more than its tank capacity since it starts making more hot water as soon as you draw some out). With the average shower using 20 gallons of water, a shave using a couple more, and washing breakfast dishes another 5 to 10, a busy family might need an FHR of 60 to 70 gallons to handle the morning rush. Your plumber can help you analyze your needs.

Energy Factor tells you how efficiently the unit operates. The higher the number, the more efficient the unit, and the less it will cost to run. In 2010, the highest EF units qualify for a 30% federal tax credit up to $1,500 for the purchase price and installation costs—as well as state credits and local utility rebates. Check the Database of State Incentives for Renewables and Efficiency for local details.
Since hot water accounts for as much as 25% of your home’s energy use, when your water heater dies, the replacement you choose will have a big impact on your monthly bills. New technologies make many of today’s models far more energy efficient than that old tank you’re getting rid of. Some of the greenest options are tankless units that heat water on demand, but even conventional water heaters—the classic metal cylinders that are by far the most popular in the U.S.—have gotten less expensive to operate.

Water heater basics

Most households need a 50-gallon tank, according to Jeff Haney, a product manager at manufacturer Rheem. That’ll cost $900 to $2,000, installed, depending on which model you choose. Your plumber will put it where the old tank was, with the cold water supply pipe attached at the bottom of the tank and a hot water outlet pipe on top.

Inside the tank, a thermostat constantly assesses the water temperature and fires up a heating mechanism when it falls below the desired setting (120 degrees is standard). When you turn on a hot water tap, heated water flows from the tank and gets replaced by more cold water from the supply line below.

To do this work, water heaters use electricity, oil, or natural gas. Choosing a new water heater that uses the same fuel type as your old unit is the easiest way to keep replacement costs down, says contractor Andy Wargo of Marcellus, N.Y.

What to look for on the label

Within each fuel type, you’ll find a range of models and price points. To compare, look for these key differences, marked right on the label:

First Hour Rating is a measure of how many gallons the unit can produce in one hour (which is more than its tank capacity since it starts making more hot water as soon as you draw some out). With the average shower using 20 gallons of water, a shave using a couple more, and washing breakfast dishes another 5 to 10, a busy family might need an FHR of 60 to 70 gallons to handle the morning rush. Your plumber can help you analyze your needs.

Energy Factor tells you how efficiently the unit operates. The higher the number, the more efficient the unit, and the less it will cost to run. In 2010, the highest EF units qualify for a 30% federal tax credit up to $1,500 for the purchase price and installation costs—as well as state credits and local utility rebates. Check the Database of State Incentives for Renewables and Efficiency for local details.

Here’s a breakdown of your basic water heater options from the American Council for an Energy-Efficient Economy:
Water Heater TypeInstalled CostYearly Energy CostLife (years)Total Cost (over 13 Years)
Conventional gas$850$35013$5,394
High-efficiency gas$1,025$32313$5,220
Conventional electric$750$46313$6,769
High-efficiency electric$820$43913$6,528
Conventional oil [there are no high-efficiency oil options at this time]$1,100$2308$4,777

High-efficiency options

Three types of tank heaters are eligible for the federal tax credit: high-efficiency gas, gas condensing, and electric heat pumps. Ask for a Manufacturers Certification Statement from your retailer. If it doesn’t provide one, the model doesn’t qualify.

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