In part one of our two part series in our water heater buying guide, we’ll take a look at the popular fuel source options – electric, gas, and heat pumps. We’ll also look at some of the differences and considerations you should take into account when selecting a water heater. Electric Water Heaters Cost Consideration Least expensive Method used to Heat Water Heating Elements (replaceable) Size Capacity 28 to 100+ gallons Energy Efficiency Many ENERGY STAR rated options available Gas or Propane Water Heaters Cost Consideration Generally higher priced than electric Method used to Heat Water Gas Burner Size Capacity 30 to 100 gallons Energy Efficiency A larger selection of ENERGY STAR rated options available Special Considerations Location where the water heater is installed must have adequate ventilation so that air can circulate Combustible materials can not be stored nearby Gas and propane is not available in all areas Heat Pump or Hybrid Water Heaters Cost Consideration Higher priced, but saves money over time in utility bills Method used to heat Pulls the ambient air and extracts the heat Size Capacity 50 to 80 gallons Energy Efficiency Can be 2 to 3 times more energy efficient than gas or electric Special Considerations Must be installed in an area that will stay in the 40-90 degree Fahrenheit temperature range Best if installed in a furnace room, or a room with excess heat Does not operate efficiently in cold places Generally larger than a standard sized electric water heater Energy Ratings Energy ratings are an important factor to consider when purchasing a water heater. Here are some things to consider: ENERGY STAR – Water heater units that earn an ENERGY STAR rating can sometimes be more expensive, but they are more energy efficient and will lower your utility bills, saving you money over the life of the unit. Energy Factor Rating – Measures the water heaters overall efficiency. There are 3 factors that are considered when determining this rating. Recover Efficiency – How efficiently the heat from the energy source is transferred to the water. Stand-by Losses – The percentage of heat lost per hour from the stored water compared to the content of the water. Cycling Losses NAECA – The U.S. Department of Energy made a change to the water heater regulations in order to increase the minimum energy-efficiency standards. The NAECA (National Appliance Energy Conservation Act) went into effect on April 16, 2015. Here is a quick overview video of what these changes are and how them may affect you.