How to Choose an Electric Water Heater

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    • 1). Determine the peak demand of hot water. According to the experts at Smart Energy, a 40-gallon tank should cover the heaviest demands of one to two people, but six or more people may need a 120-gallon tank. Use a water use chart to determine the amount of hot water your regular activities require.

    • 2). Check the first-hour rating on the water heater's Energy Guide label. The experts at Consumer Reports say that the amount of hot water the water heater can provide in one hour can be a better indicator of its suitability than just the number of gallons the tank holds.

    • 3). Compare the energy factor ratings. This number combines all of the insulation and heating efficiency information about each water heater into one simple rating, say the experts at Water Heater Rescue. The higher the rating, the more efficient the water heater will be.

    • 4). Look for long warranties. According to testing done by Consumer Reports, electric water heaters with nine- to 12-year warranties featured better insulation, more efficient heating elements and more corrosion resistance.

    • 5). Consider the long-term costs of operating the water heating. Electric water heaters cost less to purchase but can have higher operating costs. Buy a model that just meets your needs, or you will waste money heating water in the storage tank that is not needed.

    • 6). Find a water heater that fits your needs. According to the experts at Energy Right, tankless models heat water on demand, cutting the costs of heating a storage tank when hot water isn't needed. Homes with high demand may not be able to use a tankless system.

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