Choose a High-Efficiency Water Heater - NJ Green Building Manual

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					GREEN BUILDING MANUAL                               NEW RESIDENTIAL UPDATED 1-MAY-11

Choose a High-Efficiency Water Heater

What is a High-efficiency Water Heater?

A high-efficiency water heater functions like a
conventional storage hot water heater, but it
has basic improvements that result in higher
energy efficiency. Hot water heaters consist of
a steel tank lined in glass with a burner or
electric heating element located in the bottom
of the tank for heating. Water is kept in the
tank and heated continuously, refilling after
hot water is released to demand points. These
tanks may be powered by electricity, natural
gas, oil, or propane. High efficiency storage
water heater models powered by electricity
may also use water that has been pre-heated
by solar water heating systems,.1 The
insulation, heat traps, and burners on a high-
efficiency water heater are of a better quality Figure 1 - Storage Water Heater
than conventional hot water heaters, resulting (Source: US Department of Energy)
in energy and cost savings.2

How to Incorporate a High-efficiency Water Heater

The process of selecting and installing a high-efficiency storage water heater is very similar to
selecting and installing a conventional storage water heater. Select a water heater by determining
how many gallons of hot water are used during the hour of the day in which the demand for hot
water is highest. This is called your total peak hour demand. Compare this number to the first
hour rating (FHR) found on the storage water heater’s Energy Guide Label. The FHR is a
measure of the amount of hot water in gallons the heater can supply per hour assuming that the
tank is full at the beginning of this time period. For example, a household that has a peak hour
demand of 46 gallons should select a water heater model with a first hour rating of 44 to 48

  ENERGYSTAR. High Efficiency Water Heaters: Provide hot Water for Less. (accessed October 29, 2010).
  ENERGYSTAR. How It Works – High Efficiency Gas Storage Heaters. (accessed October 29, 2010).
  ENERGYSTAR. (accessed
October 29, 2010).
GREEN BUILDING MANUAL                                   NEW RESIDENTIAL UPDATED 1-MAY-11


High efficiency storage water heaters provide 10-20% energy savings over the minimum
standards and function well in any climate. They have the lowest first cost of any high efficiency
water heater type and are expected to save up to $500 over an estimated lifetime of 8-10 years.
However, other high-efficiency heating systems, such as demand (tankless) or solar water
heating systems, can provide greater savings over a longer lifetime, so it may pay to consider
alternative heating systems.4


The cost of a high-efficiency hot water heater can vary based on size and fuel type, but can range
from $400 for a 50-gallon natural gas heater to upwards of $1,500 for an 85-gallon electric
heater. Prices may vary seasonally or depending on your geographic location, so compare prices
by visiting different home improvement stores or by shopping online from trusted home
improvement vendors.

Incentives may be available for New Jersey residents who install high efficiency hot water
heaters. For up-to-date information on available incentives, please visit the ENERGYSTAR and
NJ Clean Energy websites:


Energy Savers

NJ Clean Energy

 ENERGYSTAR. High Efficiency Water Heaters: Provide hot Water for Less. (accessed October 29, 2010).

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