Choosing a Conventional Storage Water Heater

When you need a water heater replacement, you generally need one in a hurry.  Either the old water heater has quit working leaving you to deal with ice cold showers or worse, the old water heater has started leaking and flooded your den or basement.

Whether you fall into one of these categories or you are one of the fortunate few who have the foresight to replace your water heater before it goes out, don’t just choose the first water heater you see at the big box store.  Take a few minutes to sort through your options and choose a water heater that will do a great job for you and your family for years.

Choosing the proper tank size and a high R-value will help reduce your energy costs, but you should also focus on the first hour rating (FHR) to help you choose and appropriately sized water heater.  The first hour rating is the amount of water that a water heater can supply in an hour starting with a full tank of hot water.  The size of the tank affects the first hour rating, but so does the type of fuel (gas or electric) and the size of the heating element or burner.

First, estimate how much hot water is needed during the peak hour of hot water usage during the day.  For many families this is first thing in the morning when the family is getting ready for work and school.  In other households, it might be in the evening hours.

Once you have an estimate of the peak hour demand for hot water in your home, look for a water heater with FHR within a couple gallons of your peak hour demand.  This will help ensure that you will not run out of hot water during peak usage periods, but will minimize energy consumption for standby heat loss.

Water Heater Standby Heat Loss

Storage type water heaters have long been the most popular type of residential water heater.  A conventional storage type water heater keeps a tank full of water hot for use when needed.  Despite their popularity, storage water heaters waste energy due to standby heat loss and waste water when the tap has to run for a period of time before the hot water reaches the tap.

In an effort to address these concerns, many homeowners have converted to demand (or tankless) water heaters that only heat water when it is needed and can produce instant hot water if installed at every tap, but the conversion from a conventional storage type water heater to a demand water heater is expensive and demand water heaters have a few disadvantages that detract from the allure of instant hot water.

Sticking with a storage water heater offers the lowest up front cost and by choosing a properly sized energy efficient unit, your operating costs will not be a lot more than with an on-demand system.  The primary way that storage water heaters waste energy is through standby heat loss.  Energy is wasted by keeping the tank of water hot even when there is no demand for hot water.

You can minimize standby heat loss by looking for a water heater with a heavily insulated tank.  Thermal resistance is measured by R-Value and the higher the R-Value, the better insulated the tank is and the less energy that is wasted on standby heat loss.  Look for a minimum R-Value of R-12 and a higher R-Value would be better.  Some water heaters have thermal resistance of up to R-25.

2011 Water Heater Tax Credit

If you are in the market for a new water heater, you should consider installing an energy efficient water heater to take advantage of the energy efficiency tax credit.  The credit for 2011 is not as good as last year, but it’s still a good incentive and the savings from an energy efficient water heater will continue for years.

If you installed your water heater in 2010, the tax credit is much more generous.  For qualifying energy efficient water heaters, consumers were eligible for a tax credit equal to 30% of the cost of the water heater up to $1,500.  This tax credit was set to expire at the end of 2010

Congress extended the tax credit to cover qualifying energy efficient water heaters installed in 2011, but the available tax credit has been reduced.  This year, a consumer is eligible for a credit equal to 10% of the cost of the water heater and the total credit for the water heater is limited to a maximum of $300.

This tax credit includes qualifying standard gas, propane, and oil water heaters, electric heat pump water heaters, and tankless on-demand water heaters.  The tax credit is a dollar for dollar reduction in your federal tax liablility for 2011.

The credit is also available for other energy efficient products such as roofing and HVAC equipment with a total limit of $500 for all energy efficient equipment installed in 2011.

Although the tax credit is not as much this year, it’s still a great deal.  Water heating can account for up to 25% of a home’s energy usage.  Saving 10% on an energy efficient water heater not only saves you money today, but it will help you save money on your energy bill for year after year.