Saving Money Before it Goes Down the Drain

How much can you save by looking for the ENERGY STAR?

By Steve Ryan

Water heating is the second highest source of energy usage in your home, and no matter what the season, hot water is a necessity.  The average water heater lasts about 13 years, but many water heaters are in use past their life expectancy. Nearly 2.5 [1] million water heaters will fail this year, leaving their owners without hot water (and with wet basements). By being proactive, and replacing your water heater before it fails, you’ll have more options. And you’ll avoid cleaning up a flood in your basement.

If you need to replace your current gas or electric water heater or are planning for an upgrade, you should choose a water heating system that not only provides enough hot water, but does so without wasting energy. Look for an ENERGY STAR certified water heater to save energy and money, while also reducing your carbon footprint.

For example, if you replace your old electric storage water heater with an ENERGY STAR model, the annual savings range from $290 for the average household to $670 for a family of six (see graph).  Even with the extra costs for a heat pump water heater (HPWH), which average about $850 (including insulation), you will still see fast savings.

  • For the average household, an ENERGY STAR HPWH pays back in 3 years and saves $2,050 over its 10-year lifespan.
  • For a six-member family, an ENERGY STAR HPWH pays back in 1.3 years and saves $5,850 over its 10-year lifespan.

If you are in the market for a new water heater, check and see if your utility is offering rebates.  For example, Mass Save, an initiative sponsored by Massachusetts’ gas and electric utilities and energy efficiency service providers, currently offers a $1,000 rebate for ENERGY STAR certified heat pump water heaters.  This one purchase can go a long way in terms of saving on your energy bills and taking action against climate change. Just think–if every appliance purchased in the United States this year earned the ENERGY STAR, we would prevent greenhouse gas emissions equivalent to the emissions from 420,000 cars.

Steve Ryan started working for the Environmental Protection Agency’s ENERGY STAR Program in 1999.  He currently manages a national campaign to promote power management called “The Low Carbon IT Campaign.”  For more information and to  get step by step instructions on how to put your computer into low power mode, go to


[1] ENERGY STAR Water Heater Market Profile, U.S. DOE, September 2010. 8 million sold in 2009 (p. 2).  82% replacement, 65% replacements are unit failure, 60% of unit failures are emergencies. (p. 21).  Doing the math, we get 8 million*.82*.65*.6 = 2.5 million.

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