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High Efficiency Water Heaters

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High efficiency water heaters are a great way to save money and energy. According to the Department of Energy, 17% of what you pay for energy goes to heat water. High efficiency water heaters use as little as half the energy of standard models, so a high efficiency system can make a big difference in your budget.

There is no established definition for “High Efficiency” in water heaters. Each type of system, and each type of fuel, has to meet different standards to be considered high efficiency. The simplest way to compare systems is to check the Energy Star label for the heater's Energy Factor (EF) rating. Here is a list of the different kinds of water heaters, and the ratings they must have to be judged high efficiency.

Conventional gas or electric-fueled storage tank water heaters lose heat through the tank walls (and vent pipes on gas-fueled models). They depend on insulation to reduce this standby loss, and newer models are manufactured with greater insulation to help with their efficiency rating. You can also add a timer to lower the water temperature until shortly before hot water is needed, or use a water heater jacket for extra insulation. Both of these will make the heater more energy efficient, as will regular maintenance. A high efficiency storage tank water heater should have an EF rating of .67 for gas-fueled models and .95 for electric.

Tankless or on demand water heaters tend to use less energy than conventional systems. When you turn on the hot water faucet, a flow sensor switches on a burner. The water flows through the heat exchanger, then directly to the faucet. When you turn off the tap, the burner switches off. There is no storage tank.

Tankless water heaters can be gas or electric, and whole house or point of use. Smaller point of use systems are more efficient. A tankless system should have an EF of .82 to be considered high efficiency.

Indirect or Heat Transfer water heaters use water already heated by another source, such as a boiler or furnace, to heat water which is then stored in a well-insulated tank. This type of system eliminates heat loss through the vent pipe that is common with gas-fueled water heaters, and is simpler to install than a tankless system. It can be integrated into the boiler or furnace, or be installed as a separate component with connecting pipes. Because it relies on heat from another source, its energy efficiency is indicated by a combined appliance efficiency rating (CAE). High efficiency models should have a CAE of .85 or higher.

Electric Heat Pump water heaters use warm air, either from the surrounding room (such as a basement furnace room) or from the outdoors to heat water. Heat pump water heaters come both with integral storage tanks and as add-ons to existing tanks. This type is slightly harder to find, because consumers and even builders haven't been aware of them, and demand has been low. Heat pump water heaters are especially efficient in warm climates, and use only 1/3 to 1/2 as much electricity as conventional storage tank type electric fueled water heaters. Heat pump water heaters must have an EF of 2.0 or higher to be high efficiency.

Solar water heaters are tremendously energy efficient, though they do require a backup system for cloudy days. Solar collectors are mounted on the roof or in your yard. A passive, or direct circulation, system, most common in warm climates, pumps water through the solar collectors and into the storage tank. Active, or indirect circulation, systems also have circulating pumps and controls. They pump a heat-transfer fluid through the collectors and into a heat exchanger, where it heats the water. The water is then sent to the storage tank and the fluid circulates to be reheated.

Two-tank systems that combine a solar water heater with a conventional storage tank are efficient and popular. These systems use the solar collectors to “pre-heat” the water that enters the traditional system. As a result, the conventional system uses only a fraction of the energy it would otherwise use. Solar water heaters should have a Solar Fraction of 0.50, and must achieve a Solar Energy Factor of 1.8 to be considered high efficiency.

As you can see, looking for a high efficiency water heater leaves you with a lot of choices! Whatever fuel you use—electric, gas or solar—and whatever type—storage tank, two-tank or tankless—suits your family's needs, you have many models from which to choose.

Know the standards for high efficiency, look for the Energy Star labels and compare Energy Factors. High efficiency water heaters save energy and money so whatever you pick, it's a wise choice.

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