Big Changes Coming for Water Heater Efficiency. Ready?

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New residential water heater energy-efficiency standards that go into effect April 16 will require changes to the installation of many residential water heaters. Most water heaters with a capacity of 55 gallons or less will require more installation space, and those larger than 55 gallons in capacity will see additional, more significant changes. However, products manufactured before April 16 can still be bought and installed after the changeover date.

These new efficiency standards will require much higher Energy Factor (EF) ratings for larger water heaters, making a huge impact, especially on how these types of water heaters are manufactured, distributed, installed and/or vented.

The more common-sized water heaters of 55 gallons or less will likely be larger by roughly 2 inches in height and diameter to account for the additional insulation needed to meet the new standard. This may require builders to account for the increased size in their design.

It is expected that replacement water heaters installed in closets will present the biggest problems: They may require installing an applicance with reduced water capacity, selecting a much taller tank of the same diameter or a switching to a tankless water heater if space does not allow for a simple change-out.

As more information is available from manufacturers and the federal Department of Energy, NAHB will update this page.

Larger heaters, bigger changes

There are many factors for home builders and remodelers to consider when deciding whether to specify these new larger water heaters. First is the cost: Conventional, current minimum-efficiency 60-gallon gas and electric water heaters are approximately $675-$1,500, while the new high-efficiency models are about $1,200-$2,450.

New gas water heaters with a capacity of more than 55 gallons will need to be a condensing combustion design to meet the new efficiency requirements, which raises the EF from 0.55 to 0.75 for a 65-gallon model. This means you’ll need a dedicated electrical receptacle to power the exhaust fan and provide a means for condensate disposal. For venting, a dedicated line for combustion air via a lower temperature PVC pipe will typically exhaust through the wall rather than the roof with this design.

Larger electric water heaters will need to be of a heat-pump design to meet the efficiency requirements, which increases the EF from 0.88 to 1.98 for a 65-gallon model. Where a 3 feet x 3 feet closet was often the go-to location for installation for an electric water heater, these new appliances likely won’t fit into the same space.

According to the Air Conditioning, Heating, & Refrigeration Institute, heat pump water heaters require installation in locations that remain in the 40-90 degree Farenheit range year-round and provide at least 1,000 cubic feet of surrounding air space. Because heat pump water heaters remove heat from the house to heat the water, it’s better to install them in warmer areas of the country where the cooling effect of the heat pump will reduce the air conditioning load on the house.

Gary Klein of Gary Klein and Associates says one alternative is to run new plumbing to two smaller water heaters (i.e., 40 gallons) at opposite sides of the home, bringing them closer to the point of use and conserving both water and energy by eliminating excess piping.

For gas water heaters, there may not be much of a benefit from purchasing two appliances because of the need to install another gas line and comply with ventilation requirements. However, not only can the two electric water heaters fit in smaller spaces, there is no need to manage the cold air expelled from the unit or for the design to account for proximity to fixtures to decrease heat loss in piping.

Another alternative: the gas or electric tankless water heater. These units take up little space and can be mounted indoors in cabinets, under sinks, and in very close proximity to fixtures, using less energy than conventional water heaters.

However, gas tankless water heaters may require a larger gas line and modifications to the vent pipe. Electric tankless models may require increasing the capacity of the electric service to the house. Hot water flow rate is limited by the size of the unit and measured in gallons per minute (GPM). Whole-house tankless hot water systems with up to 7.0 GPM can cost $600-$1,000.

It’s important for builders and installers to become familiar with the new rules and the technology options so that they can offer customers the best solutions for placement and capacity.

Water heater manufacturers are working to get the word out and the major manufacturers have updated their websites with the latest information. So far, A.O. SmithRheemBradford White and State Water Heaters have announced changes to product lines and installation instructions to address how these new standards will affect their customers.

For more information about this item, please contact Donald Surrena at 800-368-5242 x8574 or via email at dsurrena@nahb.org.