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Savings Project: Insulate Your Water Heater Tank

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Project Level 
medium
Energy Savings 
$20-$45 annually
Time to Complete 
1.5 hours
Overall Cost 
$30
Insulate your hot water tank to save energy and money. | Photo courtesy of iStockphoto.com/glennebo

Insulate your hot water tank to save energy and money. | Photo courtesy of iStockphoto.com/glennebo

Just like insulating your walls or roof, insulating your hot water tank is an easy and inexpensive way to improve energy efficiency and save you money each month. If your water tank is new, it is likely already insulated. If you have an older hot water tank, check to see if it has insulation with an R-value of at least 24. If not, consider insulating your water tank, which could reduce standby heat losses by 25%–45% and save you about 4%–9% in water heating costs—and should pay for itself in about a year. You can find pre-cut jackets or blankets available from around $20.

If you don't know your water heater tank's R-value, touch it. A tank that is warm to the touch needs additional insulation.

Before You Start 
  • Check with your utility to see if they offer water heater insulating blankets at low prices or offer rebates. Some utilities even install these at a low or no cost.
  • Be sure that your water heater is not leaking. If your tank leaks, you need a new water heater.
  • For an electric water heater, you also might consider insulating underneath the tank as well. A ridged piece of insulation (or bottom board) will help prevent heat loss into the floor, and could save you another 4%–9% of water heating energy. It is best done when installing a new water heater.
Shopping List 
  • A helper (you’ll need four hands for this one)
  • Tape measure
  • Marker
  • Scissors
  • Water heater insulating blanket kit
  • Gloves and a dust mask
  • Electrical or other tape (tape comes with most insulation blanket kits)

STEP-BY-STEP INSTRUCTIONS

  • 1.) Turn off the water heater.
    For electric heaters, turn off the breaker at the electric panel. For gas water heaters, turn the gas valve to the “Pilot” position.
  • 2.) Measure the height of the water heater and cut the blanket to fit if necessary.
    Leave the top of the water heater open—it is important not to block the vent on top of a gas unit.
  • 3.) Wrap the blanket around the water heater and temporarily tape it in place.
    For ease of installation, position the blanket so that the ends do not come together over the access panels in the side of the tank. Some tanks have only one access panel.
  • 4.) Using a marker, mark the areas where controls are so that you can cut them out.
    For electric water heater units, there will be two panels on the side of the tank. For gas, you'll need to mark an arch-shaped hole around the gas valves and burner. Be sure to leave plenty of room around the valve and burner areas below. Make the opening at least 1 inch wider than the valve and burner area. Also, mark the area where the pressure relief valve and pipe are. This will be a pipe that sticks out of the side of the water heater.
  • 5.) Install the blanket.
    Be careful to line up the cut out areas and then tape it in permanently in place.
  • 6.) Turn the water heater back on.
    Don't set the thermostat above 130ºF on electric water heater with an insulating jacket or blanket – the wiring may overheat.

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