As we ring in the new year, it is a great time to evaluate where your hard-earned dollars are going each month and whether there is a way to decrease the outflow.  One such way is to take a look at your current water heating system and it's functionality.  Does it need to be replaced? Should it be upgraded? The information below (provided by Jefferson Livingston owner of Pillar to Post in Bellingham) may be useful in helping you determine what is right for you.

WATER HEATING & ENERGY USE Given that as much as 25% of household energy costs are for water heating, it makes sense to evaluate various types of water heating systems with an eye toward saving both energy and money. Here we take a look at some of the options currently available for homeowners to consider.

Storage Water Heaters These are the most common type of water heater. In these systems, cold water flows into a tank where it is heated by gas or electric power. Once the water in the tank reaches the desired temperature, the heater will cycle on and off to maintain the temperature of the water. As hot water gets used, more cold water will enter the tank to be heated. Most of us know the phenomenon of running out of hot water after family members take one shower after another; this will occur if the tank's storage capacity is insufficient to meet the demand. At other times of the day when relatively little or even no hot water is being used, the heater must still fire on and off to keep the contents of the tank hot. Unfortunately, it is quite inefficient to keep a tank of water hot all day even when the water isn't needed. Adding an insulated water heater wrap can boost efficiency and energy savings – these are inexpensive and can be installed by the homeowner.

Tankless (Demand) Water Heaters Tankless or demand water heaters are just that. Water is not stored in a tank, but is rapidly heated by gas or electricity once the faucet is turned on. For many homes, a tankless heater can be located close to the sink or shower to heat water on the spot. Because it reaches the desired temperature so quickly, much less water is wasted while waiting for hot water to flow through the faucet. Tankless heaters powered by gas are usually much more efficient than electric heaters – in fact, electricity costs can sometimes negate much of the savings a tankless system might otherwise provide. Tankless systems normally cost more than a conventional storage water heater, so homeowners should research what type, size, and location makes the most sense for them.

Solar Water Heating The basic concept of solar water heating is that the sun's energy is used to pre-heat water for the home. The pre-heated water then flows into a solar tank that monitors temperature. Then it is piped into the regular hot water system, usually a storage water heater. If no water is turned on within a brief period of time, the water circulates through the system again, making it unnecessary to keep a large tank of water constantly hot. The pre-heating is done by one or two solar panels, usually installed on the roof. Solar water heating is becoming more and more popular as costs for the systems continue to decrease. By some accounts, including the California Energy Commission, a typical solar water heating system can pay for itself in as little as four to seven years.

No matter what type of water heating homeowners choose, it pays to do some research first to discover the ins and outs of various types for their specific situation. With efficiency and decreased energy use as a goal, the best choice of water heater depends on what pencils out in any given home.