What is the Most Efficient Water Heater for Residential Use?

Energy Bills

About 20
percent of the energy bills of the average American family comes from heating
water. It is no wonder that people want to reduce the energy consumption of
their water heaters and when the time comes to get a new one, efficiency is a
major factor is the selection. In this article, I will review types of water
heaters to find out the most efficient type.

Energy Sources

Most water
heaters will use either natural gas, propane or electric. While natural gas is
always the cheapest and electric is usually the most expensive, the exact
prices of each energy source varies from city to city so it is hard to reach a
definite conclusion on the type of water heater that will produce hot water
with the least cost. Yet, we can make some reliable comparisons and that is
what I will do here.

Types of Water Heaters

Storage Water Heaters

These keep a
large volume of hot water ready for use and no matter how well-insulated they
are, there is a considerable loss to the surroundings so storage water heaters
are definitely not the most efficient style. Condensing gas storage water heaters
are more efficient and gas is cheaper than electric but the heating costs are
still going to be higher than that of a tankless water heater.

Tankless Water

First, let us
take a look at electric tankless water heaters. These are 100 percent efficient
because there is no standby loss and no heat is wasted with fumes but electric
is so expensive that in most cases, it is not the best option. Propane is
nearly as expensive as electric in some states so electric turns out to be more
adventageous but wherever there is natural gas, you should use it because it is
the cheapest. Tankless water heaters can be even more efficient than plain
tankless water heaters. A natural gas condensing tankless water heater has very
low energy use so it could be the most efficient water heater you have been
looking for.

Hybrid Water

Hybrid water
heaters have heat pump systems for collecting the ambient heat to transferring
it to water. They run on electric, which is expensive but they produce at least
double the heat energy that would have been produced by turning electric into
heat. A good heat pump water heater is at least as cheap to run as a condensing
natural gas tankless water heater so we have two candidates for the most
efficient water heater. Other factors will decide the most suitable choice
between the two. If you have only electric, there is no doubt that the hybrid
is the best way to save on bills but if you have natural gas, you should
probably go for the reliability and comfort of the tankless.

Water Heaters

These are tiny
tankless water heaters that run on electric. People install these in places
like under the sink and use them for a single tap or shower head. Although
electric is not cheap, these water heaters have an interesting benefit that
make them efficient in some cases. The hot water does not have to travel any
distance so you get instant hot water and do not have to waste water until it

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