Energy Star Qualified Water Heaters: Serious New Energy Savings

As of January, five types of water heater technologies are eligible to earn the Energy Star label, which is good news for builders looking to express their commitment to energy-efficient, green construction. The energy-savings potential of these qualified products will help builders score points in the energy performance category of various green home certifications. The new Energy Star water heater program marks what the Department of Energy considers the beginning of a major transformation of the water heater market.

“Water heating is the second largest energy expenditure in a household behind HVAC,” says Richard Karney, program manager for the U.S. Department of Energy of Energy Star. “The water heaters that are now qualified under Energy Star can cut water heating bills anywhere from 7.5 to 55 percent.”

The Energy Star Residential Water Heater Program includes high-efficiency gas storage, whole-home gas tankless, gas condensing, solar, and heat pump water heaters, in ascending order of energy savings.

 

• High efficiency gas storage water heaters are a simple upgrade over conventional units. They are easy to install and the lowest cost option. 
• Gas tankless units offer continuous hot water, which will appeal to any home with teenagers. They are handy space savers, similar in size to a backpack. They can also be placed outdoors. 
• Gas condensing water heaters are expected to appear on the market later in 2009. These high-performance units will provide nearly continuous hot water but use about 30% less energy than standard gas water heaters. 
• Solar water heaters serve as pre-heaters for storage or tankless units, ensuring hot water even on cloudy days. They are most practical in homes with a south-facing roof or ground space with unobstructed sunshine for 6 hours a day. Federal tax credits will pay 30% of the cost up to $2,000. 
• Heat pump water heaters are also expected to appear on the market later in 2009. They will cut water heating expenditures by 55%, or roughly $300, as well as cool and dehumidify surrounding air.

The features of each water heater are summarized below. Learn more at
http://www.energystar.gov/waterheaters. 

Water Heater Type	Most Cost-Effective Applications	Ease of Installation and Maintenance in Retrofits	Will Reduce Annual Cost of Your Water Heating Bill by…1	Average Cost ($)2	Payback in Years3
Gas
High efficiency gas storage (50 gallon) 4	Any	Easy (same as conventional gas storage water heaters)	7.3%	~$935	2.5
Whole home gas tankless	New construction.	Installation can be more complex in existing homes. Direct venting is required for indoor models. May require larger gas lines. May require higher-voltage outlet.	30%	~$1,000 - $2,000	5-14
Solar	Major remodels or new homes with a south-facing roof or ground space with unobstructed sunshine for 6 hours a day.	Requires training.	50%	~$3000 - 6,000 5	12 or longer
Gas condensing (50 gallon)	Major remodel or new construction.	More difficult than conventional tank models. May require s pecial venting and a condensate drain, increasing the installed costs if the current system is not vented in the same way.	28%	~$1,300 - $1,800 6	4 - 9
Electric
Solar	New homes with a south-facing roof or ground space with unobstructed sunshine for 6 hours a day.	Requires training.	50%	~$3,000 - 6,000 5	10 or longer
Heat pump (50 gallon)	Any.	Requires training. May require a condensate drain.	55%	~$1,500 7	3
1 Compared to the standard model. 2 Costs can vary based on your home’s climate and orientation on the property. 3 Payback comparisons do not include reductions in initial cost through government tax credits or utility incentives or additional installed costs due to more elaborate retrofit. 4 Efficiency levels will increase to 14% in September 2010. The projected average cost is $1,265, for a payback of 7.5 years. 5 Since most installations are customized, cost is widely variable. Energy Information Administration, “The National Energy Modeling System: An Overview 2003,” April 2003. 6 Based on information in California Energy Commission’s Super Efficient Water Heating Appliance Initiative, “PIER Draft Final Project Report,” March 2007, and American Council for an Energy Efficient Economy, “Emerging Technology and Practices,” 2004. 7 Vermont Energy Investment Corporation, “Residential Heat Pump Water Heaters: Energy Efficiency Potential and Industry Status,” November 2005.