Why You Need to Buy a New Water Heater Now
New water heater efficiency regulations that go into effect next year will shave about $63 billion off America’s energy bills by 2044. However new regulations mean more work for manufacturers, which translates into higher prices for consumers. If you might be in the market for a new water heater next year, an expenditure that can set you back between $300 and $1500 depending on the size and fuel source you use, you may want to accelerate that process. A water heater bought in 2015 will cost you somewhere between $100 and $200 more than a water heater bought now.
The U.S. Department of Energy estimates that the new standards will raise the cost of a water heater by $120 and save $143 over the life of the appliance. Considering the life of a water heater is anywhere from 6 to 10 years, that is not a huge savings, but combined, it’s a giant savings for the planet. The Energy Department estimates that carbon dioxide emissions will be cut by 164 million metric tons over 30 years, the equivalent of eliminating 34 million cars for one year.
The reason for the changes is that the water heater is the second biggest energy-consuming appliance in your home, behind the HVAC system. Despite the DOE’s rather paltry money savings estimates, an efficient water heater can bring substantial long-term cost and energy savings, but it will require a much larger up-front expense. The choice you need to make before April 2015, when the new regulations go into effect, is, “Do you want to save money right now, or spread out over the next 10 years?”
The new water heaters will be more expensive because of the requirement to incorporate newer technology, such as a heat pump, into some categories. They will also be bigger because of the need for more insulation, meaning they may not fit into the space you already have, causing you to have to downsize your capacity or opt for a much more expensive and much smaller tank-less model. If you had been considering changing your water heater at all, now might be the time to act.
The cost and savings actually vary widely based on the capacity and fuel type you require in your water heater. Here is a quick breakdown of where the highest cost increases and best energy savings can be found.
According to the American Council for an Energy Efficient Economy a high efficiency gas storage tank water heater costs about $175 more to purchase and install than a standard one, and saves $25 a year. Super-efficient “condensing” and “near-condensing” gas water heaters, which save much more energy compared to traditional models, cost $2,000 — more than double.
A high efficiency electric storage water heater costs just under $100 more to purchase and install than its standard counterpart, and saves about $25 a year. Throw in an electric heat pump and the price more than doubles over a conventional electric to around $1660, but the savings skyrocket to over $270 a year; meaning it will paying for itself in a little over 3 years. The heat pump, which takes energy from the air to heat water, also dehumidifies the air, saving the cost of buying and operating a separate dehumidifier. Heat pump water heaters use one-third to one-half as much electricity as conventional water heaters.
If you are going to need a large water heater (above 55 gallons, which is suitable for homes over 3,000 square feet or with more than 3.5 baths), prices will be even higher. This is because condensing technology is mandated for water heaters above that size. However, this technology decreases energy use by 47 percent.
The new rules went into effect June 27, 2014 and residential water heaters need to be in compliance by April 16, 2015. However, you will probably be able to buy the less efficient models through the end of 2015, but no more will be manufactured after April. If you want to start saving energy now, however, many manufacturers are already offering compliant models, enabling you to opt for energy savings before next year. In addition, there are often lucrative rebates to be found when purchasing energy efficient water heaters. Check the Energy Star website for details.
Jennifer Tuohy writes about energy efficiency and home appliances, including water heaters, for Home Depot. A selection of water heaters, including types discussed by Jennifer in her article, are available on the Home Depot website.