and old water heater energuide label that says $503 per year in electricity

According to energy resource DirectEnergy, the average US citizen might pay $438 per year on their water heater alone. That assumes your heater is 4,000 watts and runs for three hours daily at $0.10 a kilowatt-hour. In reality, much of the country is 50-100% even higher than that with all this inflation and price hikes.

You’d like to save energy and thus money on your water heater.

But, how can you do it?

This guide will elaborate on ten methods for more affordable, energy-efficient water heating. So don’t spend another month paying a too-high bill! Check out this post instead. 

Ways to Make Your Water Heater More Energy-Efficient

The best methods to save energy on your water heater include:

  1. Insulate pipes
  2. And the heater
  3. Get a recirculating system
  4. Add a timer
  5. Install heat traps
  6. Drain the heater
  7. Remove sediment
  8. Turn down the thermostat
  9. Reduce hot water usage 
  10. Upgrade the heater

Now that’s you’ve seen the rundown, let’s look at each of these techniques in greater detail.

Insulate the Pipes

Whether yours is a gas or electric heater, it’s comprised of a series of internal and external pipes. 

For over 40 years, the standard for manufacturing water heater pipes has been copper. Copper is resistant to most damage and reliable, and it’s even somewhat good at trapping heat. Yet you can make it even more efficient by insulating your water heater pipes.

You don’t need to insulate the entirety of the pipes; only about six feet of every pipe protruding from your water heater. 

Obviously, you can do nothing to insulate the internal pipes, but they should be warm enough anyway due to their proximity to the hot water.

Insulating the water heater pipes makes it easier for your water heater to reach an optimal temperature quickly, so it doesn’t strain. 

As a result, you might be able to milk a few more years out of your water heater, and its performance in the interim should improve. 

Insulate the Water Heater

Why stop at just the water heater pipes when you can insulate the water heater itself?

You’ll focus your insulating efforts on the storage tank. You can insulate the tank regardless of whether it runs on oil, natural gas, or electricity. 

Unlike insulating your water heater pipes, which you can do yourself if interested, we caution you against encasing the water heater tank as a DIY job. Instead, it’s best to work with a plumber. 

Why is that?

Well, if you cover the wrong parts of the water heater, you will have trouble.

Two technicians insulate the pipes of a water heater

For example, you should never cover the bottom and top of the tank, the burner, or the thermostat. 

Get a Recirculating System

Another great way to save energy and cash on your water heater is to invest in a recirculating system. For the uninitiated, this system goes directly on the heater. 

As the name implies, the recirculating system can send hot water to your heater. This water is always unused, so you have water whenever needed.

You don’t have to wait for the water to heat up, so it’s almost like having water on demand. Thus, you won’t waste as much time with the water running, waiting for it to turn hot finally. 

That’s good, as this can be a terribly wasteful habit. For example, any faucet from 1994 or later produces 2.2 to 2.5 gallons of water per minute (GPM). 

A bathtub uses between 4.0 and 8.0 GPM, a shower between 2.5 and 5.0 GPM, and a toilet between 2.2 to 5.0 GPM.

Okay, so it’s not like you’re standing around the toilet waiting for the water to heat up, but for the shower, tub, and sink, it all applies. A recirculating system will make a big difference for you.  

Add a Timer

Another suitable solution to make your water heater more energy-efficient is to install a timer on the heater. Did you know that some models always run, especially older ones? 

That’s right; your water heater is still chugging away in the background even if you’re not using any of the faucets, taps, or other water sources in your home. 

That sucks up a lot of electricity and reduces your home’s energy efficiency. Instead, a hot water heater timer ensures that the unit only runs when you want it to. 

For instance, when everyone is out of the house during the day at work and school, there’s no need to have the heater on. No one is even home to use the water!

You could power off the heater during those daylight hours and then program it to turn back on in the evening just in time for those who like to shower at night to have hot water. 

A technician adjusts a timer on the front of a water heater tank

Then you can turn it off overnight when everyone in the house is sleeping and program it so it’s on in the morning just in time for your morning shower.

When your water heater doesn’t constantly run, the electricity savings you could enjoy are tremendous. Further, you’re prolonging the life of your water heater since it’s only running for several hours per day rather than 24/7.  

Install Heat Traps

Your water heater has both a hot water inlet pipe and a cold water inlet pipe. Unfortunately, these pipes are prime areas for heat to exit the heater, thus making it work harder and take longer to produce warm water.

Heat traps are an optimal solution for this issue. These pipe loops are specifically designed for a water heater’s hot water inlet pipe and cold water inlet pipe. The heat trap sends cold water to the hot water tank, where the tank can warm that water. 

But that’s not all! 

The heat trap will also keep hot water from exiting the tank and limit convection. Convection is when colder materials, such as liquid, sink deeper and hotter materials, also like liquid, rise higher. 

If your newer water heater is more recent, you might not need heat traps, as it probably already has them. The older the heater, though, the greater the likelihood that it doesn’t have heat traps. 

They’re cheap to procure and aren’t too difficult to install, especially if you’re already familiar with the hot water inlet pipe and the cold water inlet pipe. 

The heat trap component atop a water heater tank
Courtesy of How to Look At a House

Installing heat traps could lead to a hot water bill savings of up to $30 a year, according to The Spruce, which is not too shabby considering this is such a small change. 

Drain the Heater

When was the last time you drained your water heater tank? If the answer is never, then no wonder it isn’t running as efficiently as it could be. 

At least once or twice a year, you should empty your water heater fully. 


Well, for one, you can clear sediment from the tank, which we’ll talk more about in just a moment. Second, you can also check for leaks, dings, rust, and other signs of damage, indicating your heater’s time might end. 

Please don’t feel like you have to drain your tank yourself, especially if you’re not comfortable doing so. 

But, if you insist on draining it yourself, please always allow the water temperature to cool down before you drain. Otherwise, you’re at serious risk of burns! 

Remove Sediment

Water heaters can build up sediment over time. It’s gross but a normal part of ownership. 

Some water heater owners ignore the sediment. Perhaps they’re unsure how to remove it or don’t know that it has to go. 

It does, though, especially if it’s beginning to accumulate. 

Sediment buildup prevents your water heater from working well. As you know by now, any hindrance to the performance means the unit has to work harder.

Straining and struggling like this shortens your water heater’s life and makes the unit less energy-efficient. You’ll also see how much harder your water heater is working on your higher monthly bills. 

You can wear gloves and other protective equipment if that makes you feel better, but you must eliminate the sediment. Ideally, it would be best if you made this a habit every time you drain the tank—so at least once or twice a year. 

Don’t let some sediment sit and build up more for next time; you’re only creating extra work for yourself. Even if there’s only a bit of residue, get rid of it. 

Turn Down the Thermostat

Do you know what temperature your water heater is set to? It’s worth paying attention to the thermostat reading, especially if you want to make it more energy-efficient.

The average water heater temperature is 140ºF, which is plenty toasty—maybe even too hot.

A tankless water heater installed on a wall

For the next week, try running the heater thermostat at only 120 degrees. The heat of the water when showering and doing dishes shouldn’t be noticeably different, but your water bills will come down.

Another benefit of reducing the temperature of your water heater is that it slows down the rate of corrosion and mineral and scale accumulation. 

This is, again, a straightforward, quick change that can have a significant impact on how energy efficient your water heater is! 

Reduce Hot Water Usage

Here’s an intelligent method for reducing your spending on your water heater—cut back on how much you use it.

That simply means reaching for the hot water faucet a little less frequently than you do now.

Few people enjoy taking cold showers, but they’re highly advantageous. Cold water can energize you, and it’s better for your skin and hair than hot water (you might even glow!).

If you go to the gym a lot, cold showers can soothe your muscles better than hot ones. Cold water also improves circulation and can treat skin inflammation. 

Some people even believe that cold showers help you lose weight by triggering your body’s brown fat, which gives off heat and could burn calories. 

We’re not saying you need to take a cold shower every day, but doing it at least a few times a week will help you save energy. 

Upgrade Your Water Heater 

We saved the best for last. Our top recommendation for a more energy-efficient water heater is to upgrade the unit.

No matter how many of the above changes you make, if your water heater is more than 20 years old, it can only be so energy-efficient because of outdated technology.

Buying an energy-efficient water heater, especially one with the Energy Star seal of approval, will automatically slash your bills.

You can then make your already eco-friendly heater even more energy-efficient by insulating it and instituting the above changes. 


Are you frustrated with how much money your water heater costs you monthly and year after year? Do you wish this unit could be more energy efficient?

With the ten measures we shared in this article, you can make your water heater less wasteful and expensive to use and run. 

Remember that if your water heater is older, you’re better off replacing it with a tankless, Energy Star-certified heater than trying to make your current unit more energy-efficient.

Although a new water heater is quite an investment, you’ll recoup the money with lower energy bills!

One Comment

  1. This article on saving energy with water heaters offers practical tips to help homeowners reduce energy consumption and lower their utility bills. The suggestions provided, such as insulating the water heater, adjusting the temperature, and considering energy-efficient models, are valuable ways to maximize energy efficiency. By implementing these measures, homeowners can contribute to a more sustainable and cost-effective home. Thank you for sharing these helpful energy-saving tips for water heaters. Well done on providing a resource that promotes energy efficiency and environmental consciousness!

Leave a Reply

Your email address will not be published. Required fields are marked *