High-efficiency storage water heaters save money as well as the environment.

A.O. Smith believes the well-recognized Energy Star brand can elevate awareness of energy-efficient,tank-type water heaters, such as its atmospheric vent model.


A no-hot-water call is never a fun call for plumbing contractors. Customers are generally in a crummy mood when they don’t have hot water - they can’t take a shower or bath, do the laundry, wash dishes, etc. They may be having company for the weekend or having a dinner party, which makes a bad situation even worse.

Water heaters tend to last about 10-15 years. According to the Environmental Protection Agency, there are 27 million households in the country with a water heater that’s more than 10 years old. And whatever the circumstance, when a water heater breaks down, it is usually at the worst possible moment for your customer. He or she is in crisis mode, and may not have the patience to carefully weigh the pros and cons of each model before making a selection.

Cue the knowledgeable plumbing contractor. More and more, consumers are paying attention to their energy consumption - they may want to save money, they may want to save the environment, they may want to do both. It’s the knowledgeable plumbing contractor’s job to assess the needs of the homeowner and steer him or her in the right direction.

Consumers looking for energy-efficient appliances are already familiar with the Department of Energy/EPA Energy Star program. Appliances that carry the Energy Star label - washing machines, dishwashers, refrigerators, televisions, etc. - must satisfy certain energy-efficiency criteria. The program was expanded Jan. 1 of this year to include certain water heater models.

Plumbing contractors and consumers may already be aware of the energy savings that tankless water heaters have, but they may not know that there are many tank-type water heaters that also have high energy-efficiency ratings. These high-efficiency storage water heaters now carry the Energy Star label.

“From a manufacturing standpoint, having that Energy Star designation helps elevate awareness for contractors and consumers that there are other options in water heaters that are more efficient and better performing,” explains David Chisholm, brand manager for A.O. Smith Water Heaters (www.hotwater.com).

The average household spends $400-$600 per year on water heating, making it the second largest energy expenditure behind heating and cooling, reports the EPA. Homeowners can save up to $30 per year (average household of 2.6 people) with an Energy-Star-rated high-efficiency gas storage model, $115 with whole-home tankless models, and up to $220 per year with a solar water heater. (Energy Star will also be qualifying gas condensing and heat pump water heaters, which are expected to enter the market by the end of the year.)

“Water heaters do use a significant amount of energy,” says Chuck Rohde, market manager for tank products at Rheem Water Heating (www.rheem.com). “We need to be aware of energy consumption so we can make good decisions when purchasing new appliances. Energy Star helps educate contractors and consumers on which water heaters conserve the most energy.”

Part of the push to educate people on the availability of Energy Star water heaters came from the Coalition for Energy Star Water Heaters (www.eswaterheaters.org), which is comprised of 18 sponsors, including water heater manufacturers A.O. Smith, Rheem, Bradford White Corp. and Rinnai (tankless water heaters); the Air Conditioning, Heating and Refrigeration Institute; the Consortium for Energy Efficiency; and gas and electric utilities. Its goal is to encourage the awareness of Energy Star-qualified water heaters among installers, distributers, retailers and consumers.

To become eligible for the Energy Star label, residential gas tank-type water heaters must meet these criteria:
  • A nominal input of 75,000 Btu/hour or less and a rated storage volume from 20 to 100 gallons;

  • An energy factor (the ratio of useful energy output from the water heater to the total amount of energy delivered to the water heater) equal to or greater than 0.62;

  • The first-hour rating (the amount of hot water in gallons a storage water heater can supply per hour) must be equal to or greater than 67 gallons per hour;

  • The warranty must be at least six years on a sealed system; and

  • The model must meet ANSI Z21.10.1/CSA 4.1.
For qualifying models, go to the Energy Star Web site at www.energystar.gov.

The 0.62 energy factor will expire Aug. 31, 2010, and a new energy factor of 0.67 will be required of Energy Star gas storage water heaters. This lower energy factor was established to be fair to all tank-type water heater manufacturers and give them time to design models with higher energy efficiency, notes Cliff Deidiker, A.O. Smith Water Heaters residential product manager.

Installation of high-efficiency water heaters is no different than installing a basic storage water heater. In a few cases, these water heater models may have a larger footprint than the water heaters they are replacing, Rohde notes, but it is not a significant problem.

Bradford White offers Energy Star-qualified models for every type of application: atmospheric vent, ultra-low NOx, power vent, power direct vent and combination heating.

How Much?

Recently, the Department of Energy announced nearly $300 million in funding from the American Recovery and Investment Act slated for state-run rebate programs geared toward consumer purchases of Energy Star-qualified appliances, including water heaters. The DOE expects the majority of funding to be awarded to states by Nov. 30. (Editor's Note: An explanation of this rebate program, and federal tax credits for water heaters, can be found here.) (To find other rebate programs in your area, visit the Database of State Incentives for Renewables & Efficiency, www.dsireusa.org.)

“Given the current economic conditions, there has to be more of a financial payback for consumers,” says Jason Fifer, a product manager at Bradford White Corp. (www.bradfordwhite.com). “We believe that consumers will be interested in upgrading to a high-efficiency Energy Star water heater because Energy Star does a great job of informing the consumer regarding energy savings and payback.”

High-efficiency models have better insulation, heat traps and more efficient burners, the EPA says, all which contribute to a modest increase in price to the contractor (10 to 30 percent, manufacturers say, depending on how old the water heater being replaced is) but a 7 to 14 percent rise in energy efficiency for the homeowner. Power venting may also be added to accelerate the ventilation of combustion gases.

High-efficiency water heaters that have the Energy Star label are easier for plumbing contractors to sell because consumers are already familiar with Energy Star in connection with the other appliances they buy, says Deidiker.

“Our concern was that the additional cost of these high-efficiency models would make it difficult for contractors to sell,” Rohde notes. “Instead, we’ve seen a lift in sales.”

He attributes part of the rise in sales to various local, state and utility incentive programs. “They help mitigate costs to move to an Energy Star water heater,” he says.

The EPA says payback for high-efficiency gas storage water heaters is about 2 1/2 years. But payback isn’t the entire message, Chisholm says; doing the “right thing” for the environment is an important part of the Energy Star program.

Fifer agrees. “The importance of the Energy Star designation for contractors is that they have a ‘greener’ product they can sell to homeowners. For homeowners, they have a product that uses less energy, resulting in reduced annual energy consumption.”

Rheem’s new line of power-direct vent water heaters has an energy factor of 0.67, which meets the second-phase criteria of the Energy Star tank water heater rating effective in September.

Tips On Recommending Energy Star Water Heaters To Homeowners

Most consumers are aware of the Energy Star label and the option to purchase Energy Star appliances such as dishwashers or refrigerators. However, as of January 2009, water heaters have joined the Energy Star program to offer energy-efficient options for water needs.

There are a variety of energy-efficient residential water heaters that have qualified for the Energy Star label. Highly efficient gas storage and tankless water heaters as well as solar water heating systems are available today, while condensing heat pump and condensing gas storage are expected to enter the market soon.

So how do you help homeowners choose the models that are best suited for their families and homes? With all these choices, it’s worth it to take the time to talk to homeowners about their lifestyle in order to determine which Energy Star-qualified model is the right fit for them.

The Consortium for Energy Efficiency and the Coalition for Energy Star Water Heaters have identified some important questions to ask homeowners, including:
  • How many people live in the home? Do you expect this to change any time soon?

  • How old are any children living in the home?

  • How many full bathrooms are in the home?

  • How many half bathrooms are in the home?

  • How many people shower daily? How long do those showers usually last?

  • Does anyone in the home take a bath?

  • How large is your bathtub?

  • What kind of showerhead do you use?

  • Are there any additional fixtures that use hot water sources beyond the standard kitchen sink, dishwasher or clothes washer?

  • During high water consumption, how many fixtures would be supplying hot water at the same time?

  • Is your current water heater gas or electric?
It will be up to you to use your best judgment when determining the technical requirements of the water heater. Keep in mind installation costs and local utility programs, which can help homeowners make the decision that is best for their lifestyle.

Resources: There are a few resources available to assist you in helping homeowners find the right water heater. The Energy Star Web site has more information on which water heaters qualify for the federal tax credit (www.energystar.gov/taxcredits), and on which water heaters qualify for the Energy Star program (www.energystar.gov/waterheaters).

The Air-Conditioning, Heating and Refrigeration Institute has designed a calculator to help consumers understand their peak hot water use. Finally, the coalition has a list of rebates available from energy-efficiency programs around North America (www.eswaterheaters.org).