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Water Heaters


Storage water heaters are by far the most common type of water heater in the U.S. today. Ranging in size from 20 to 80 gallons (or larger) and fueled by electricity, natural gas, propane, or oil, storage water heaters heat water in an insulated tank. When you turn on the hot water tap, hot water is pulled out of the top of the water heater and cold water flows into the bottom (through a "dip tube" from the top) to replace it. Because heat is lost through the flue and the walls of the storage tank (this is called standby heat loss), energy is consumed even when no hot water is being used. New energy-efficient storage water heaters contain higher levels of insulation around the tank and one-way valves where pipes connect to the tank, substantially reducing standby heat loss.

Demand (or instantaneous) water heaters eliminate the storage tank by heating water directly when there is a call for hot water. These units are growing in popularity in the U.S. The energy consumption of these units is generally lower since standby losses from the storage tank are eliminated. Demand water heaters with enough capacity to meet household needs are gas- or propane-fired. They have three significant drawbacks for some applications: Large simultaneous uses (two showers and the clothes washer, for example) may challenge their capacity, particularly in winter,when the inlet water is coldest. They will not turn on unless the hot water flow is ½ - 3/4 gallon/minutes. Retrofit installation can be very expensive. Finally, because the efficiency tests were not developed with these designs being considered, it is not known if the "EF" accurately estimates energy consumption. If you choose a tankless unit, look for one eligible for 2006-2007 federal tax credits (EF levels).

Heat pump water heaters are more efficient than electric resistance models because the electricity is used for moving heat from one place to another rather than for generating the heat directly. The heat source is the outside air or air in the basement where the unit is located. Refrigerant fluid and compressors are used to transfer heat into an insulated storage tank. Heat pump water heaters are available with built-in water tanks called integral units, or as add-ons to existing hot water tanks. A heat pump water heater uses one-third to one-half as much electricity as a conventional electric resistance water heater. In warm climates they may do even better, but there are few sources for these products.

Indirect water heaters use the home’s boiler or furnace as the heat source. In boiler systems, hot water from the boiler is circulated through a heat exchanger in a separate insulated tank. In the less common furnace-based systems, water in a heat exchanger coil circulates through the furnace to be heated, then through the water storage tank. Since hot water is stored in an insulated storage tank, the boiler or furnace does not have to turn on and off as frequently, improving its fuel economy. Indirect water heaters, when used in combination with new, high-efficiency boilers or furnaces, are usually the least expensive way to provide hot water. These systems can be purchased in an integrated form, incorporating the boiler or furnace and water heater with controls, or as separate components. Gas, oil, and propane-fired systems are available.

Solar water heaters use energy from the sun to heat water. Solar water heaters are designed to serve as preheaters for conventional storage or demand water heaters. While the initial cost of a solar water heater is high, it can save a lot of money over the long term. Solar water heaters are much less common than they were during the 1970s and early 1980s when they were supported by tax credits, but the units available today tend to be considerably less expensive and more reliable. At today’s prices, solar water heaters compete very well with electric and propane water heaters on a life-cycle cost basis, though they are still usually more expensive than natural gas.


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