a traditional water heater on the left and a tankless water heater on the right with the Energy Star blue logo in the middle

Are you wondering what the phrase “Energy Star-rated” water heaters means? Maybe you know what it means but are unsure what water heaters types have this designation.

This article will cover all you need to know about Energy Star and an in-depth look at each water heater type. Read on to learn more about this rating, whether you can trust it, and if switching to an Energy Star-rated heater is worth it.

So, what kinds of water heaters have this rating, and what exactly does it tell you about the product?

What Types of Water Heaters Are Energy Star-Rated?

Several water heaters like heat pumps, solar, gas storage tanks, tankless, and commercial gas water heaters are Energy Star-rated. These are heaters deemed fit by the US Environmental Protection Agency (EPA) to provide the most energy-efficient ways to heat your water.

What Is Energy Star?

Energy Star is a government-issued symbol that signifies the energy efficiency of household, commercial, and office equipment, such as water heaters, washing machines, etc. The program offers information on the energy consumption of over 75 products and devices. 

A picture of five appliances with the energy star logo above them.

The EPA and the US Department of Energy (DOE) jointly run this initiative. However, you can also find this program in Japan, Switzerland, Canada, and Taiwan.

Since the government backs this symbol, its information is credible and unbiased. Therefore, consumers and businesses can rely on it when deciding on energy-saving appliances.

Industrial, commercial, and local organizations partner with the EPA to offer solutions that reduce carbon footprints while protecting public health and improving the overall quality of life. That’s in addition to the fact that these solutions are budget-friendly.

What Are Energy Star Water Heaters?

Energy Star-rated products earn this label by abiding by the EPA’s strict energy efficiency criteria. These specifications help you save energy and money while simultaneously protecting the planet.

Energy Star-rated commercial water heaters use about 15% less energy than typical commercial units. They achieve this by using more efficient heat exchanges. 

In the past, this rating only applied to gas-fired storage and gas-fired instantaneous (tankless) units, but now, you can find the Energy Star label on electric heat pumps and solar-powered water heaters.

Ultimately, water heaters that are Energy Star-rated come with electric, solar, or gas heat pump technology. As a result, they work using less energy and can save you thousands of dollars throughout their lifespan.

The appliance transfers ambient heat to water through a refrigerant-based system for electric heat pump water heaters. This system uses less than 50% of the energy an electric resistance unit would.

Theoretically, one Energy Star electric heat pump water heater can save a minimum of 10 MWh, which would be the equivalent of removing 1½ cars off the road yearly.

Types of Water Heaters With Energy Star Rating

There are five types of water heaters with Energy Star ratings. They include heat pump, solar, gas storage tank, tankless, and commercial gas water heaters (storage or tankless). Here are descriptions of each type.

Heat Pump Water Heaters

Generally, an Energy Star-rated heat pump water heater (HPWH) uses about 50% less energy than a typical electric water heater. This reduction in energy use can save you a lot of money and protect the environment. According to Energy Star, HPWH can save you more than $3,750 over its lifetime.

Photo of the heat pump water heater in the corner of the garage of the First Attainable Home
A heat pump water heater in the corner of the garage of our first Attainable Home

Heat pump water heaters do not generate heat directly. Instead, they gather heat from surrounding air or the ground found in the basement, utility room, or in some cases, outside. 

Then, HPWH technology transfers this heat to the tank of water. This type of heater does not require electricity to generate heat; it only uses it to move water from the heater to its endpoint.

The best thing about these heaters is that they have enough storage to carry a large amount of hot water. However, this storage means you need ample space to store them. 

Solar Water Heaters

Compared to a standard model, you can save up to 60% more energy when you use an Energy Star-rated solar water heater. 

Solar water heating systems come in various designs, with different circulation systems and collectors. However, it would be best if you opted for a system that can withstand freezing temperatures during the winter.

Solar water heaters work by harnessing the sun’s power to generate heat. However, they do not absorb the heat directly. Instead, they have solar panels that you mount onto your roof. These panels power the heating mechanism, which, in turn, heats your water.

A full solar water heater system setup

As this heating system does not require electricity from the grid, it is one of the most energy-efficient heaters. However, these heaters do not work proficiently on cloudy days. Therefore, you might need a secondary power source (electric or gas).

Gas Storage Tank Water Heaters

You can save up to 14% more energy using an Energy Star-rated storage-tank water heater compared to a standard model. 

These heaters have more efficient heat exchangers than their traditional counterparts. Therefore, they transfer more heat from their energy source to the water. Furthermore, the tanks have improved insulation, which helps to minimize heat loss.

They also come with built-in heat traps and cold-water inlet pipes. These heat traps help reduce heat loss from tanks and pipes. You can find the cold-water inlet pipes at the bottom of the water tanks, and they help improve heating efficiency. 

The most efficient of these heaters are the gas-fired models. This effectiveness is because they come with features such as electric ignition (as opposed to continuous boring pilot light) and condensing heat exchangers, which improve overall efficiency.

Tankless Water Heaters

Using an Energy Star-licensed tankless water heater generally saves you about 30% more energy than a standard tank heater. 

These types of heaters do not have a tank. Instead, the device contains coils (powered by an electric element or gas burner) that heat the water as it goes through the mechanism to its endpoint. This results in readily available hot water that hardly runs out.

A tankless water heater installed on a wall

While this heater provides an endless hot water supply, it might be hard to supply multiple appliances simultaneously. For example, the heater might be unable to provide hot water to your dishwasher and washing machine simultaneously.

Commercial Gas Water Heaters

Those who use an Energy Star-branded commercial gas water heater can save about 25% more energy on average than a regular model. 

There are two types of Energy Star commercial gas heaters. They can either be tanked water pumps powered by gas or electricity or tankless heaters powered by gas. Regardless, both models work to save you money and reduce your carbon footprint.

These heaters have some of the most efficient heat exchangers, significantly reducing the electricity needed to heat water. Furthermore, these larger commercial units provide more savings in terms of energy and finances compared to residential units.

Factors That Cause High Energy Use in Water Heaters

While water heaters are more efficient now due to Energy Star ratings, some factors make them use a lot of energy.

Some reasons your heater may use so much energy include:

  • Size of the tank – the size of your water tank plays a huge role in energy consumption. The larger it is, the more energy your heater requires to heat the water.
  • Insulation – without proper insulation, heat would escape from the water in the tank. Hence, your heater would need to expend more energy to reheat your water.
A homeowner makes adjustments to the foam insulation attached to the pipes atop his water heater tank
  • Excess hot water use – using hot water excessively means water in your tanks will run out quickly. So, when this water runs out, your heater must work double-time to replace the hot water you used.
  • Buildup of sediment – several regions in the US utilize hard water, meaning there are lots of deposits and solids in the water. When your heater heats hard water, sediments crystalize and drop to the bottom of your tank. With time, they build up and reduce the efficiency of your heater.

Is Switching to an Energy Star-Rated Water Heater Worth It?

Initially, switching to an Energy Star-certified water heater might seem daunting. That’s because you are probably considering the cost of removing your current unit and reinstalling the new one. 

However, the energy and money you save in the long run are worth it. So just take the plunge if you are on the fence about making the switch. By doing so, you are saving costs and the planet.

Final Thoughts

Energy Star-certified products are the best way to ensure you are saving money and energy. Water heaters are appliances you use daily, so investing in an Energy Star-licensed model can pay off in the long run. 

There are various types of these heaters, each as good as the other. So, you should have no problem finding one that fits your needs.


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