31 Aug
2011

Federal Tax Credit for Energy Efficiency – Water Heaters

Posted by Norman Fong

water heater, energy efficient water heater

The Federal Tax Credit for Energy Efficiency – Water Heaters expired in 2011. The President chose not too extend this tax credit. Local energy utility companies like PG&E have their own energy efficiency rebates. To find out if rebates or other incentives are available in your area, visit the ENERGY STAR Rebate Finder.

Be sure to check out our reduce water heater use, water saving tips and ways to save energy.

The 2011 Federal Tax Credit

There is a Federal Energy Efficiency Tax Credit on Qualifying Gas, Oil, Propane Water Heaters as well as Electric Heat Pump Water Heater and Solar Water Heaters. If your water heater is on its last legs, you might as well upgrade now and save some money. Newer water heaters require less energy and time to heat water. Reduce the waiting time between showers and doing laundry.

For 2011, the Federal Tax Credit for energy efficiency drops to 10%, up to a $500 maximum. (2010 Federal Tax Credit information)

  • $300 cap for water heater
  • Gas, Oil, Propane Water Heaters must have Energy Factor >= 0.82 or a thermal efficiency of at least 90%
  • Newer Hybrid water heaters are also available
  • Electric Heat Pump Water Heater requirements are the same as ENERGY STAR: Energy Factor >= 2.0.
  • Existing home and principal residence.   New construction and rentals do not qualify.
  • Expires December 31, 2011 – Consult the What other rebates are available? below for other possible rebates.

Consider an on demand Tankless Water Heater if your situation allows for it.  Most need ready access to a good sized gas pipe and exhaust vent.

Solar Water Heaters are covered if they are EnergyStar certified. The Federal Tax Credit for solar water heaters is 30% of the cost including installation and labor. It expires December 31, 2016.

AO Smith makes the hi tech Vertex 100 water heater that is very efficient, but requires PVC pipe venting not normal metal venting. Also consider installing radiant floor heating instead of using a gas furnace as these newer water heaters support radiant heating.

Note: It is difficult to find larger sized water heaters with Energy Factor’s not qualify.

Posted on August 31st, 2011
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8 Responses to “Federal Tax Credit for Energy Efficiency – Water Heaters”

  1. Energy Efficient Eco Friendly Water Heater | Easy Eco Blog Says:

    [...] for a new water heater?  Ours is getting old and with the Federal Tax Rebates, it was time to look into the [...]

  2. New California Solar Water Heater Rebate | Easy Eco Blog Says:

    [...] Local utility companies administer the rebate, so check with your local utility company. PGE has a page outlining the program that also covers San Diego Gas and Electric (SDG&E), Southern California Edison (SCE) or Southern California Gas (SoCalGas). California’s rebate is in additional to the Federal Energy Tax Rebate. [...]

  3. Hybrid Water Heaters - GE GeoSpring Water Heater | Easy Eco Blog Says:

    [...] cheap, they start around $1600 for a 50 gallon, 15GPM GeoSpring model. This unit is covered by the 2010 Federal Energy Tax Credit. [...]

  4. Tankless Water Heaters - Federal Tax Rebates | Easy Eco Blog Says:

    [...] Federal tax credits of up to $1500 are available. [...]

  5. Ways to Save Energy, Money on your Utility Bill | Easy Eco Blog Says:

    [...] Tax Credit on install Energy efficient items such as solar panels, windows, doors, skylights, water heaters, furnaces, boilers, pellet stoves, etc at a nice discount. This tax credit expires [...]

  6. PG&E Energy Upgrade California (EUC) Rebates | Easy Eco Blog Says:

    [...] sure to take advantage of the Federal Tax Credit too! [...]

  7. Federal Tax Credits for Energy Efficiency - Wood Heat Stoves, Pellet Stoves, Fireplace Inserts | Easy Eco Blog Says:

    [...] Pellet Stoves, Fireplace Inserts.  There is also a Federal Tax Credit for Energy Efficiency on Water Heaters, Wood Heat Stoves, Pellet Stoves, Furnaces and [...]

  8. PG&E Energy Efficiency Rebates, Appliance rebates, Utility PGE Rebates | Easy Eco Blog Says:

    [...] including: Windows, Doors, Skylights – Wood Heat Stoves, Pellet Stoves, Fireplace Inserts – Energy Efficient Water Heaters – Solar [...]

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