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With costs for utilities on the rise, heating water with a propane system is more cost-effective and more energy-efficient. And it could result in a significant tax credit and savings for homeowners.

Choosing Propane

Standard liquid propane gas tank water heaters can heat between 40 and 100 gallons of water, depending on the home’s size and water needs. But advances in technology, coupled by the national push toward using greener and cleaner fuels, have sparked consumer interest in tankless propane heaters.

According to Steve Clark, chief scientist for GREENandSAVE, a Philadelphia-based green consulting firm, while these units use 50 % less energy, they also cost significantly more. But long-term savings make the switch worthwhile: An ENERGY STAR® qualified propane tankless heater with an Energy Factor (EF) of 82% can save a homeowner up to 60% on energy bills compared with a standard electric model.

Phil Squair, senior vice president of the National Propane Gas Association, adds, "Propane appliances are an excellent choice from the standpoint of personal economics and environmental impact."

Tank Heaters

The common propane tank water heater has existed for decades, but thanks to technological advances, now operates more efficiently than before. The system uses a large internal container that holds and heats water prior to use. Tanks retail from $500 to $600, but typical operational costs far exceed those of tankless models.

For example, the thermostat of a 50-gallon water tank could be set to 120ºF, even when hot water isn’t needed for several consecutive days. As a result, the tank heats water unnecessarily and creates standby heat loss. To illustrate, Clark offers, "It’s a bit like keeping a pot boiling all day to make spaghetti at dinner-time."

Despite some of its operational inefficiencies, propane is still a more cost-effective heating solution when compared to electricity and oil.

Tankless Heaters

For maximum fuel efficiency, your clients may want to consider a tankless on-demand water heating system. The system works similarly to that of an air conditioner: Water enters the unit and travels to coils heated to a preset temperature by a propane burner. The water is only heated when it travels to the tap for use.

As a result, carbon emissions from a tankless propane water heater result in 60% fewer emissions than a standard electric water heater.

Customers pay for this system’s heating efficiencies, as tankless heaters can cost up to twice as much as standard systems. However, depending on use, the unit can pay for itself in a matter of months. It also takes up less space than a small 20-gallon tank.

Clark says that considering a homeowner’s lifestyle is important when making a decision between a tank and tankless system.

"The tankless unit may not be cost-effective for two retirees but might be for a family of six with four teenagers, a gym or a pool," he says, noting that the more hot water your clients need, the more money they’ll save with a tankless heater.


Resources for Plumbers

For more information about the environmental and cost-saving benefits of propane water heaters, here’s a list of online resources to point your customers in the right direction based on their water heating needs.

U.S. Department of Energy: Energy Efficiency and Renewable Energy

This comprehensive guide to energy-saving water heaters breaks down units by fuel type, size, availability and cost. It also provides links to water heating codes, standards and tax incentives.

Air-Conditioning, Heating and Refrigeration Institute

Find out which conventional propane systems and tankless hot water systems offer a government tax credit.

Database of State Incentives for Renewables & Efficiencies

State and utility companies have incentive programs, including rebates, loans and grants. Find out what’s available to customers in your area.

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