Q:  I have to replace my 30-gallon electric water heater in the near future. What should I look for?
 
A:  Heating water can consume as much as 25% of the total energy used in your home, so making the right choice when installing a new water heater is very important.
 
The idea is to select a water heater that provides you with adequate amounts of hot water and heats the water efficiently. That'll save you the most money in the long run.
 
CHOOSING THE BEST SIZED WATER HEATER
Sizing the water heater correctly is key to making the right choice. You'll also want to compare the different water heating systems available. You may find that switching from electric to gas is cost effective, especially if you already have both fuel sources available. Or you might want to look into a solar water heating or tankless system, or a heat pump.

Your 30-gallon water heater is the most common type of water heating system. Sizes range from 20 to 80 gallons. This is called a storage-type heater because hot water is stored. Because the tank water is kept hot regardless of whether a faucet is open, stand-by heat loss occurs. To reduce this stand-by loss and lower operating costs, select a heater that is insulated at least to R-20.
 
The bigger the tank is, the higher the stand-by heat loss. Therefore, it is important to select the right size water heater tailored to your needs. Bigger isn’t always better.

FHR RATING
Use the water heater’s first hour rating (FHR) to size it properly, not the tank capacity. The FHR is the amount of hot water the heater can produce per hour starting with a full tank of hot water. You'll find the FHR rating on the yellow appliance Energy Guide label.
 
To use the FHR for sizing a heater, get your plumber to help you estimate how many gallons of hot water your home demands during the daily peak hour. Then select a heater with a FHR that is within 2 gallons of this demand.
 
ACTIONS THAT SAVE MONEY
There are a few things you can do to make your new water heater more efficient and extend its lifetime.

• Install an insulating water heater jacket. It's very inexpensive and easy to do.
• Insulate the first six feet of the hot outlet and cold inlet pipes to reduce heat loss.
• Insulate hot water pipes that run through unconditioned space like a crawlspace or a garage. It's a cost effective way to make the water heating system more energy efficient.
• Put an insulating foam pad underneath a new electric water heater that lives on a concrete slab in the garage.
• Boost energy efficiency by adding heat traps, or valves that don’t allow hot water to flow out of the tank through thermosiphoning.
• Installing heat traps when your replace the water heater will save money and energy. Check if your new unit has built-in heat traps.
• Installing a second anode rod can extend the life of a storage type water heater.
• Draining a quart of water from the tank every three months will keep the heater running efficiently and living longer.

 
TIP:
If electricity is your only fuel option for water heating, compare the conventional storage type system with a tankless or instantaneous water heater. Also, if you live in a mild climate zone, consider replacing your electric unit with a heat pump water heater. It's several times more efficient than a conventional electric water heater.