Washington, DC —

New efficiency standards released late yesterday by the Obama administration’s Department of Energy (DOE) will deliver huge energy savings nationwide by making each of the millions of new water heaters installed more energy efficient, according to a coalition of energy efficiency, consumer and environmental organizations.

In addition, for the very largest home water heaters, the new efficiency standards will for the first time require advanced technologies — heat pumps for electrically-powered products and condensing technology for gas products — paving the way for even bigger future savings.

"From washing hands to hot showers to clean dishes, we all rely on water heaters for our daily needs," said Steven Nadel, executive director of the American Council for an Energy-Efficient Economy (ACEEE). "These new standards will deliver big national energy savings, reduce consumer energy bills and cut pollution."

According to DOE, for most product sizes sold, the new standards can be met with modest changes, such as adding more insulation to today’s conventional tank-style water heaters. For the most common size electric water heater (50 gallons), the standards will save 4 percent while for the most common size gas water heater (40 gallons), the new standards will save 3 percent. These per unit savings add up to big national impacts since more than nine million home water heaters are sold every year and water heating accounts for some 12 percent of the typical home’s energy use.

However, for the biggest products — those with over 55 gallons in storage capacity, which is about 9 percent and 4 percent of the electric and gas water heater markets respectively — the new standards can only be met with heat pump and condensing technology. Heat pump electric water heaters save at least 50 percent and gas condensing water heaters save about 25 percent relative to today’s conventional storage water heaters.

"In the long run, a shift to electric heat pump and condensing gas water heaters is absolutely essential if we are to make deep cuts in household energy use and costs," said Jeffrey Harris, vice president, national programs, of the Alliance to Save Energy. "DOE deserves tremendous credit for kick-starting this transition with its new standards."

The new standards will save 2.6 quads of energy over 30 years or about enough energy to meet the total needs of about 13 million typical U.S. households for one year. Over the same period, consumers would save about $8.7 billion and carbon dioxide emissions would be cut by 154 million metric tons (an amount equal to the typical annual emissions of 30 million cars).

Based on DOE analyses, ACEEE estimates that a transition to electric heat pump and condensing gas products in all sizes and applications that make sense would save about 10 quads of energy and reduce CO2 emissions by about 0.5 billion metric tons.

Last year, President Obama committed to accelerate DOE’s work to update many outmoded standards. These new standards are the latest in a series of more than 20 that must be completed during the current presidential term.

"Just a year into President Obama’s administration, DOE has made remarkable progress to update appliance standards," said Appliance Standards Awareness Project Executive Director Andrew deLaski. "DOE’s new standards prove again that the cheapest and cleanest energy is the energy we save."

Condensing and heat pump technologies are common in space heating but have only a toehold so far in the water heater market. More than 40 percent of U.S. furnace sales are of condensing products, and about 8 percent of U.S homes are warmed with heat pumps. Several major water heater companies have brought these technologies to the water heater market and other major manufacturers are working to develop and introduce competing products.

"The Obama administration has demonstrated again its strong commitment to an energy efficient future with these standards. These standards are a big step toward improving the efficiency of U.S. homes," said Earthjustice associate attorney Tim Ballo. "We are encouraged to see the Obama administration make the right choice and give energy efficiency the boost that it deserves. We hope this decision signals the administration’s future choices on energy efficiency standards, which have the ability to put money back in the American people’s pockets, spur innovation, create jobs, and lift our economy, while at the same time reducing harmful air pollution from power plants."

A broad coalition of consumer, energy efficiency and environmental groups as well as utilities, state officials and more than 17,000 individuals wrote DOE urging adoption of the standards announced today.

Today’s final rule also updates minimum standards for less common products such as tankless water heaters (also known as instantaneous water heaters), pool heaters and direct heating equipment, a type of space heater.

Read the DOE rule