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Is a High-Efficiency Water Heater Really Worth It?


The term high-efficiency typically appeals to our pursuit for products that show quality, speed and effectiveness. It also speaks to goods that are kind to the environment or at least kinder than their predecessors were.

When it comes to water heaters, there are a number of choices available and for good reason. Did you know that warming up your at-home water supply comprises nearly 20 per cent of your home’s energy use? Heating your water supply ranks second, albeit a distant second, to the amount of energy used to heat your home, which clocks in at 63 per cent. Hot water is an expensive proposition as it accounts for between 15 and 25 per cent of your household energy bill.

While the natural thing is to replace your broken down water heater with the exact same model, you should at least consider the different types of water heaters that are on the market. Next to the standard storage model, there are tankless or on-demand, heat pump models and those that are solar assisted. Then there are the different fuel types used by water heaters such as electric, natural gas, propane and oil.

Storage or tank water heaters, which are the most commonly used appliances, are also the most inefficient. That’s because anywhere from 20 to 80 gallons of water is being kept hot and ready for use at all times. That sucks a good amount of energy. Insiders call this energy-out-of-the-window formula ‘standby losses.’

Demand or tankless water heaters are a good alternative because the supply of hot water is made on demand or as needed. As a result, standby losses are eliminated.

Heat pump water heaters somehow transfer energy from the air to water in the storage tank.

Solar water heating is another alternative. While the initial costs are high with this choice, the long-term costs of operating a solar water heater can save you up to 90 per cent. The only stipulation with this system is that you also need a conventional water heater as backup should the solar system fail to operate.

There is a myriad of considerations to think about when investing in a high-efficiency hot water tank. What you ultimately choose depends on your budget and needs. Let’s take a look at an efficiency comparison of common types:

A standard storage water heater has low initial costs and a life span in the neighbourhood of eight to ten years. Energy savings are the lowest at 10 to 20 per cent. A tankless water heater can last up to 20 years and provides an unlimited water supply. The heat pump water heater is the most efficient for those using electricity. They generally last about ten years. Solar offers the best energy savings, in the range of 70 to 90 per cent and last up to 20 years.

The data included on this website is deemed to be reliable, but is not guaranteed to be accurate by the Toronto Real Estate Board. The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license.