Insulating a Water Heater

Insulating your water heater is a snap, and this small investment of time and money can save you more than $100 on your annual energy costs.
By Eric Corey Freed and Kevin Daum
October 12, 2011

When does a green home project make financial sense? In “Green Sense for the Home: Rating the Real Payoff From 50 Green Home Projects,” green architecture guru Eric Corey Freed and business expert Kevin Daum team up to give you straight talk on the value of going green at home — what’s worth paying for and what’s not, where to find all of the rebates and credits out there, and what kind of savings you’ll see — so you’ll know when to spend. Projects include weatherizing windows, harvesting rainwater, using a clothesline, installing a green roof, a many more.
COVER: THE TAUNTON PRESS
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The following is an excerpt from Green Sense for the Home by Eric Corey Freed and Kevin Daum (The Taunton Press, 2010). 

If your home is like most, hot water is produced in a hot water heater. This large tank usually sits in a garage, closet or basement and slowly heats up a vat of water. Think of it as a 60-gallon thermos with a built-in heater. If the stored water drops below a certain temperature, the heater automatically heats it back up again, so you always have hot water ready to go at any moment. Providing this endless supply requires energy — and lots of it. Nearly 20 percent of all of the energy used in the home goes just to the water heater, making it the second-largest energy user in homes after heating and cooling.

Whether your hot water heater runs on gas (a fossil fuel) or on electricity (created by burning fossil fuels), it contributes to global warming and to our ongoing energy crisis. By reducing the temperature of the heater — with a timer, thermostat or simply by turning it down — you can reduce its energy consumption. And just as you insulate the walls of your home to hold in heated or cooled air, insulating your hot water heater is equally important. The time it takes to install water heater insulation will be well worth the payback in energy savings.

What will this project do for your home? 

Insulating a water heater tank reduces the heat losses or standby losses from keeping the water sitting around waiting for you to turn on the hot water faucet by 25 percent to 45 percent. This translates to as much as a 9 percent savings in total energy usage.

If you have an electric water heater, you can save an additional 5 percent to 12 percent of your energy usage by installing a timer that turns the heater off at night or while you’re at work and don’t need hot water. Plus, a well-insulated water heater means there will be less chance of your running out of hot water during a shower, as the heat remains in the tank.

What will this project do for the Earth? 

In the United States alone, water heating is responsible for 122 billion kilowatt-hours (kwh) of energy used annually. If everyone insulated their hot water heaters, nearly 11 billion kwh of that energy would be saved — enough to power 1 million homes for a year.

Will you need a contractor? 

No. Insulating your hot water heater tank is simple and inexpensive, and it can be done in about an hour.

What are the best sources for materials? 

Pre-cut insulation kits are widely available at home stores. Before you head out to the store, make note of the gallon capacity of your hot water heater. Be sure to choose a wrap with an insulating value of at least R-8; higher numbers are better. Read the manufacturer’s instructions carefully before wrapping the heater, and be sure not to block any vents or get too close to the pilot light (gas flame).

How much maintenance will be required after installation? 

Water heaters can last 10 to 15 years, and periodic water heater maintenance can significantly extend your water heater’s life and minimize loss of efficiency. Read your owner’s manual for specific maintenance recommendations.

How long will the project take to accomplish? 

Insulating your hot water heater should take no more than an hour, and less if you have a helper.

What is the capital cost? 

Turning the thermostat down is free and insulating blankets are inexpensive. No more than $25 should get you a top-of-the-line insulating blanket that you can install in an hour. If you decide to go the timer route, you’ll pay from $60 to $100, plus installation if you need an electrician, which may cost you another couple hundred dollars.

What financial resources are available? 

A number of cities and states offer rebates of $5 to $10 for blankets. A few water districts occasionally offer free blankets, so it’s worth calling your local utility to find out what’s available. Timers don’t stimulate the same rebate activity.

What is the monthly cost or savings? 

Hot water usage varies from home to home, but if you are saving 25 percent to 45 percent of your water heater energy — which represents roughly 20 percent of your energy bill — you can count on a 5 percent to 9 percent savings (or $10 to $18) on a $200 monthly bill. That means the blanket pays for itself in a couple of months, and it’s pure savings after that.

What is the long-term home value? 

You likely won’t get more for your house because of a wrapped heater, but you get a lower energy bill, which may help in the process.

The bottom line? 

This remedy is a hot one for sure! Who wouldn’t want to make a small investment of time and money to save more than $100 annually? The timer may not be perfect for everyone, but turning down the thermostat and adding an insulating blanket are smart things every home owner should do. No need to ponder more — it’s a wrap!

Insulating a Water Heater

For this project, you’ll need a water heater insulation kit, tape measure, duct tape and a utility knife.

1. Measure and cut the insulation for the top of the tank to fit around the piping coming out of it. Cut it a few inches larger than the top so you can tape the insulation to the sides of the tank. Do not insulate the top of a gas water heater.

2. Fold the edges of the top insulation down and tape them to the sides of the tank.

3. Position the insulating blanket around the tank. Be sure the blanket ends do not overlap on top of the access panel on the side of the tank.

4. With the insulating blanket wrap in place, tape it (or tie it, depending on what’s included in the kit) around the tank. Evenly space the tape or ties, making sure they don’t cover the access panel. The tape or belts should be snug, but should not squeeze the blanket more than 20 percent of its thickness.

5. Fit or cut the blanket to go around the pressure-relief valve and the overflow pipe sticking out of the side of the tank. Keep the blanket away from the drain at the bottom and the flue at the top.

6. By pressing on the blanket wrap, mark the corners of the tank access panel. Use a utility knife to make an X-shaped cut in the insulating blanket from corner to corner. Fold these triangular flaps underneath the insulating blanket.

The installation of insulating blankets on gas water heater tanks is more complicated than for electric models. Follow the same steps as above, but make sure the airflow to the burner isn’t blocked or obstructed, and that the thermostat is left uncovered by the wrap. Never install an insulating blanket on a leaking tank. If your tank is leaking, you may need a new water heater.

The fastest and easiest way to cut your hot water bills is by simply turning down the temperature on your water heater. Most manufacturers preset the thermostat to 140 degrees Fahrenheit, but turning it down to 123 degrees is ideal. That temperature is hot enough to kill bacteria but not hot enough to scald anyone.

Reducing your water temperature to 123 degrees also slows mineral buildup and corrosion in pipes, helping a water heater last longer. For each 10-degree reduction in water temperature, you can save from 3 percent to 5 percent in energy usage.

Improve Water Heater Efficiency

If you have a tank water heater, here are some tips to cut down the energy consumption:

1. Turn Down the Heat. Water heaters have a simple thermostat to set the water temperature. If the temperature is set too hot, then you are mixing it with cold water at the tap to cool it down. This wastes energy. If you don’t need the water that hot, turn down the thermostat.

2. Insulate Your Hot Water Pipes. Your local hardware store carries insulation for hot water pipes. These $10 sleeves install in seconds and increase your water temperature by 2 degrees to 4 degrees.

3. Replace Older Heaters. If your heater is more than 10 years old, it may be time to replace it with a new, more efficient model. Newer electric heaters also have timers that help save energy by heating water according to the schedule you set.

4. Fix Leaky Faucets. A leaking water heater is a sign of future trouble and is costing you money in the meantime. A heater that drips once per second costs approximately $4 a month in lost energy and even more in water costs.

5. Insulate the Room. Water heaters are often put in cold locations, such as basements or garages, which causes the heater to work much harder than it needs to. If possible, insulate the room where the water heater is kept.

6. Install a Drain Recovery System. As hot, soapy water goes down the shower drain, a heat-recovery drain steals the heat from this water and circulates it back to the water heater. The $400 to $600 drain can save $200 to $350 a year in hot water costs.

7. Turn It Off When You’re Out of Town. If you are going away on vacation, turn off the water heater. Electric water heaters can be shut down at the breaker box. Gas heaters can often simply have the thermostat turned down low. This way, you won’t need to relight a gas pilot light when you return.


Reprinted with permission from Green Sense for the Home, published by the Taunton Press, 2010. 


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