The Unfiltered Blog

April 20, 2015

What you need to know before replacing your water heater

By Chuck Gassmann, CEO

Taking a shower, washing dishes, doing laundry — what do these all have in common? Hot water. The majority of Americans have such easy access to hot water in their homes, it’s easy to take the technology that makes it happen for granted… until the hot water stops coming. Did you know the average home water heater lasts about a decade?

But before replacing your water heater it’s important to know that as of April 16, 2015, the U.S. Department of Energy implemented new, stricter energy efficiency standards for water heaters. While any water heater manufactured after April 16, 2015, needs to meet the new standards, companies can continue selling older models until they run out of inventory. Homeowners will see modest increases in energy efficiency — about four percent — with new units. Unfortunately, the cost to purchase a new water heater will increase nearly 50 percent.

Water heaters with a tank

If you’re looking to replace your water heater, there are two main options: tank or tankless. Most likely your home currently has a water heater with a 40 to 55 gallon tank. This type of water heater stores water in the tank at about 120 degrees and is ready when you need it. These units are about 62 percent energy efficient.

Tankless water heaters

Unlike a water heater with a tank, a tankless (or on-demand) water heater provides hot water on demand. Instead of storing gallons of water and keeping it at 120 degrees, it heats up the water just in time for you to use it. These units are 85 to 95 percent energy efficient. You can also choose between a gas or electric model. However, electric is not a realistic option for most homeowners, as you will need to run an additional service line from the street in order to provide enough power to the water heater and the rest of your home. This is an expensive undertaking.

Purchase and installation of a water heater ranges from about $1,000 to $4,000. Upgrading from a tank to a tankless model is easier said that done. Tankless models require much more gas to instantly heat up the water — about five times the amount of a model with a tank. This means you’ll need to have access to your gas line and increase the size of the gas pipe, which could be quite the process. Many times tankless water heaters are ideal for homes with easy access to short gas lines and for new construction. Of the 500 water heaters Bell Brothers installs each year, about 10 percent are tankless.