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CHAPTER 3. MARKET AND TECHNOLOGY ASSESSMENT 

TABLE OF CONTENTS

3.1 INTRODUCTION .................................................................................................. 3-1

3.1.1 Description of Products............................................................................... 3-1

3.1.2 Definitions................................................................................................... 3-3

3.1.3 Product Classes ........................................................................................... 3-5

3.1.4 Product Test Procedures ............................................................................. 3-7

3.2 MARKET ASSESSMENT ..................................................................................... 3-8

3.2.1 Trade Associations ...................................................................................... 3-8

3.2.1.1 Air-Conditioning, Heating, and Refrigeration Institute ............... 3-8

3.2.1.2 Hearth, Patio & Barbecue Association ........................................ 3-9

3.2.1.3 Association of Pool and Spa Professionals .................................. 3-9

3.2.2 Manufacturer Information ......................................................................... 3-10

3.2.2.1 Manufacturers and Market Shares ............................................. 3-10

3.2.2.2 Small Business Impacts ............................................................. 3-13

3.2.3 Distribution Channels ............................................................................... 3-14

3.2.4 Regulatory Programs ................................................................................ 3-16

3.2.4.1 Current Federal Energy Conservation Standards ....................... 3-17

3.2.4.2 State Energy Conservation Standards ........................................ 3-18

3.2.4.3 Canadian Standards Association ................................................ 3-19

3.2.4.4 Mexico ....................................................................................... 3-20

3.2.5 Voluntary Programs .................................................................................. 3-20

3.2.5.1 American Council for an Energy Efficient Economy ................ 3-21

3.2.5.2 Consortium for Energy Efficiency ............................................. 3-21

3.2.5.3 ENERGY STAR ........................................................................ 3-21

3.2.5.4 Federal Energy Management Program ...................................... 3-22

3.2.5.5 Rebate Programs ........................................................................ 3-23

3.2.5.6 Super-Efficient Gas Water Heating Appliance Initiative .......... 3-23

3.2.6 Historical Shipments ................................................................................. 3-24

3.2.6.1 New Home Starts ....................................................................... 3-24

3.2.6.2 Shipments ................................................................................... 3-25

3.2.6.3 Water Heater Unit Shipments .................................................... 3-25

3.2.6.4 Water Heater Value of Shipments ............................................. 3-26

3.2.6.5 Direct Heating Equipment Shipments ....................................... 3-27

3.2.6.6 Pool Heater Shipments ............................................................... 3-28

3.2.7 Industry Cost Structure ............................................................................. 3-28

3.2.8 Equipment Lifetime .................................................................................. 3-29

3.2.9 Market Performance Data ......................................................................... 3-30

3.2.9.1 Residential Water Heaters.......................................................... 3-30

3.2.9.2 Direct Heating Equipment ......................................................... 3-42

3.2.9.3 Pool Heaters ............................................................................... 3-48

3.3 TECHNOLOGY ASSESSMENT ......................................................................... 3-48

3.3.1 Baseline Equipment Components and Operation ..................................... 3-49

3.3.1.1 Baseline Residential Water Heaters ........................................... 3-49

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3.3.1.2 Baseline Direct Heating Equipment........................................... 3-50

3.3.1.3 Baseline Pool Heaters ................................................................ 3-50

3.3.2 Technology Options .................................................................................. 3-51

3.3.2.1 Water Heaters............................................................................. 3-51

3.3.2.2 Direct Heating Equipment ......................................................... 3-64

3.3.2.3 Pool Heaters ............................................................................... 3-71

3.3.3 Technologies That Do Not Affect Energy Efficiency as Measured ......... 3-74

3.3.3.1 Water Heaters............................................................................. 3-74

3.3.3.2 Direct Heating Equipment ......................................................... 3-75

3.3.3.3 Pool Heaters ............................................................................... 3-75

LIST OF TABLES 

Table 3.1.1 Product Classes for Residential Water Heaters ............................................ 3-5

Table 3.1.2 Proposed Product Classes for Direct Heating Equipment ............................ 3-6

Table 3.2.1 Manufacturers Whose Products Are Included in the AHRI Directory ......... 3-9

Table 3.2.2 Major and Other Residential Water Heater Manufacturers ........................ 3-10

Table 3.2.3 Residential Water Heater Manufacturers by Technology Type ................. 3-12

Table 3.2.4 Gas-Fired Traditional Direct Heating Equipment Manufacturers .............. 3-12

Table 3.2.5 Gas Hearth DHE Direct Heating Equipment Manufacturers ...................... 3-13

Table 3.2.6 Gas-Fired Pool Heater Manufacturers ........................................................ 3-13

Table 3.2.7 Small Business Manufacturers of Residential Water Heaters, Direct Heating 

Equipment, and Pool Heaters ......................................................................................... 3-14

Table 3.2.8 Federal Energy Conservation Standards for Residential Water Heaters .... 3-17

Table 3.2.9 Federal Energy Conservation Standards for Direct Heating Equipment* .. 3-18

Table 3.2.10 California State Efficiency Standards for Residential Water Heaters ...... 3-19

Table 3.2.11 California State Energy Conservation Standards for Pool Heaters .......... 3-19

Table 3.2.12 Canadian Efficiency Standards for Residential Water Heaters ................ 3-20

Table 3.2.13 Mexican Efficiency Standards for Water Heaters .................................... 3-20

Table 3.2.14 ENERGY STAR Residential Water Heater Criteria Issued on April 1, 2008

........................................................................................................................................ 3-22

Table 3.2.15 FEMP Gas Water Heater Performance Requirements .............................. 3-23

Table 3.2.16 FEMP Electric Water Heater Performance Requirements ....................... 3-23

Table 3.2.17 Sample Rebate Programs .......................................................................... 3-23

Table 3.2.19 Residential Water Heater Value of Shipments by Year ........................... 3-27

Table 3.2.20 AHRI and HPBA Residential Direct Heating Equipment Industry Estimated 

Shipment Data (New Construction and Replacement)* ................................................ 3-28

Table 3.2.21 Residential Gas-Fired Pool Heater Shipments*........................................ 3-28

Table 3.2.22 Industry Cost Structure Using SEC Data .................................................. 3-29

Table 3.2.23 Equipment Lifetimes................................................................................. 3-30

LIST OF FIGURES 

Figure 3.2.1 2006 Market Shares for the Domestic Residential Water Heaters ............ 3-11

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Figure 3.2.2 Water Heaters Distribution Channel ......................................................... 3-15

Figure 3.2.3 Direct Heating Equipment Distribution Channel ...................................... 3-16

Figure 3.2.4 Pool Heater Distribution Channel ............................................................. 3-16

Figure 3.2.5 New Privately Owned Single-Family and Multifamily Housing Unit Starts in 

the United States, 1990-2008 ......................................................................................... 3-25

Figure 3.2.6 Residential Water Heater Industry Shipments (Domestic and Imported) . 3-26

Figure 3.2.7 Distribution of Gas Storage-Type Water Heater Models by Energy Factor for 

All Storage Volumes, All Burner Types ........................................................................ 3-31

Figure 3.2.8 Distribution of Gas-fired Storage Water Heater Models by Rated Storage 

Volume, All Burner Types ............................................................................................. 3-32

Figure 3.2.9 Distribution of Gas-Fired Storage-Type Water Heater Models by Storage 

Capacity, All Burner Types ........................................................................................... 3-33

Figure 3.2.10 Distribution of Ultra Low NOX Gas-Fired Storage-Type Water Heater 

Models by Energy Factor for All Storage Volumes ...................................................... 3-34

Figure 3.2.11 Distribution of Ultra Low NOX Gas-Fired Storage Water Heater Models by 

Storage Capacity ............................................................................................................ 3-35

Figure 3.2.12 Distribution of Electric Storage-Type Water Heater Models by Energy 

Factor for All Storage Volumes ..................................................................................... 3-36

Figure 3.2.13 Distribution of Electric Storage Water Heater Models by Rated Storage 

Volume ........................................................................................................................... 3-37

Figure 3.2.14 Distribution of Electric Storage-Type Water Heater Models by Storage 

Capacity ......................................................................................................................... 3-38

Figure 3.2.15 Distribution of Oil-Fired Storage-Type Water Heater Models by Energy 

Factor for All Storage Volumes ..................................................................................... 3-39

Figure 3.2.16 Distribution of Oil-Fired Storage-Type Water Heater Models by Storage 

Capacity ......................................................................................................................... 3-40

Figure 3.2.17 Distribution of Instantaneous Gas-Fired Water Heater Models by Energy 

Factor, All Input Capacity Ratings ................................................................................ 3-41

Figure 3.2.18 Distribution of Instantaneous Gas-Fired Water Heater Models by Input 

Capacity ......................................................................................................................... 3-42

Figure 3.2.19 Distribution of Wall Furnace Fan-Type Models by Input Rating and AFUE

........................................................................................................................................ 3-43

Figure 3.2.20 Distribution of Wall Furnace Gravity-Type Models by Input Rating and 

AFUE ............................................................................................................................. 3-44

Figure 3.2.21 Distribution of Floor Furnace Models by Input Rating and AFUE......... 3-45

Figure 3.2.22 Distribution of Room Heater Models by Input Rating and AFUE .......... 3-46

Figure 3.2.23 Distribution of Hearth Models by Input Rating and AFUE .................... 3-47

Figure 3.2.24 Distribution of Pool Heater Models by Input Capacity and Thermal 

Efficiency ....................................................................................................................... 3-48

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CHAPTER 3. MARKET AND TECHNOLOGY ASSESSMENT
 

3.1 INTRODUCTION
 

This chapter details the market and technology assessment that the U.S.

Department of Energy (DOE) has conducted in support of the ongoing energy

conservation standards rulemaking for residential water heaters, direct heating

equipment, and pool heaters.

This chapter consists of the market assessment and the technology assessment.

The goal of the market assessment is to develop a qualitative and quantitative

characterization of the residential water heater, direct heating equipment, and pool heater

industries and market structures based on publicly available information and data and

other information that DOE received directly from manufacturers and other interested

parties. DOE examined publicly available information from the Air­Conditioning,

Heating, and Refrigeration Institute (AHRI) Consumers' Directory of Certified Efficiency

Ratings for Heating and Water Heating Equipment (formerly the Gas Appliance

Manufacturers Association (GAMA)a equipment certification directory), as well as U.S.

Census Bureau Current Industrial Reports (CIR) and Annual Survey of Manufacturers

(ASM), the appliance database from the California Energy Commission (CEC) , and

information from the Federal Trade Commission (FTC). The market and technology

assessment addresses manufacturer characteristics and market shares, existing regulatory

and non­regulatory efficiency improvement initiatives, product classes, and trends in

product markets and characteristics. DOE performs the technology assessment to develop

a preliminary list of technologies (referred to as technology options) that could be used to

improve the efficiency of residential water heaters, direct heating equipment, and pool

heaters.

3.1.1 Description of Products

Residential water heaters primarily provide hot water to residences for consumer

use, appliances, and other functions. Some residential water heaters may also provide

heated water to radiant heating systems. A basic gas storage residential water heater is

comprised of a standing pilot ignition system, a burner, a combustion chamber, a flue

baffle, a flue, an insulated water tank, a cold water inlet and hot water outlet, a sacrificial

anode, a gas valve, a temperature and pressure relief valve, a thermostat, heat traps, and

an outer case. A basic electric storage residential water heater is comprised of an electric

resistance heating element, a sacrificial anode, an insulated water tank, a cold water inlet

and a hot water outlet, a temperature and pressure relief valve, a thermostat with wire

harness, heat traps, and an outer case. A basic oil storage residential water heater is

comprised of a combustion chamber, a flue baffle, a flue, an insulated water tank, a cold

water inlet and hot water outlet, a sacrificial anode, a power burner system, a thermostat,

a The Air­Conditioning and Refrigeration Institute (ARI) and GAMA merged on January 1, 2008 to

become the Air­Conditioning, Heating, and Refrigeration Institute (AHRI). For more information, please

visit www.ahrinet.org.

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a temperature and pressure relief valve, and an outer case. A basic gas instantaneous

residential water heater is comprised of a combustion chamber, a burner, a heat

exchanger, a vent, a cold water inlet and hot water outlet, a gas valve, a standing pilot

ignition system, a burner control thermostat, a flow detector, and an outer case.

In the United States, 99.9 percent (110 million) of homes have water heaters (as

of 2005). Energy consumption attributable to water heater operation represents 1.7

percent (1.68 quads) of total U.S. energy consumption. Within individual homes, water

heating represents, on average, 17 percent of total annual household energy

consumption.1

Direct heating equipment (DHE) typically provides primary or supplemental

space heating within a single room in a building. Some direct heating equipment,

including gas hearth DHE, serves an aesthetic purpose in addition to being used for space

heating. A basic residential gas wall fan­type heater consists of an outer case, an air

circulation fan, a burner, a combustion chamber/heat exchanger, a standing pilot ignition

system, a pilot light sensing control valve, a flue, a draft diverter, an air intake, and a

burner control thermostat. A basic residential gas wall gravity­type heater consists of an

outer case, a burner, a combustion chamber/heat exchanger, a standing pilot ignition

system, a pilot light sensing control valve, a flue, a draft diverter, an air intake, and a

burner control thermostat. Gravity provides air circulation as warm air rises (i.e., warm

air, which is less dense, rises and cool air, which is more dense, descends due to

buoyancy effects). A basic residential gas floor heater consists of an outer case, a burner,

a combustion chamber/heat exchanger, a standing pilot ignition system, a pilot light

sensing control valve, a flue, a draft hood, an air intake, a burner control thermostat, and

a floor grate. A basic residential gas room heater consists of an outer case, a burner, a

combustion chamber/heat exchanger, a standing pilot ignition system, a pilot light

sensing control valve, a flue, a draft hood, an air intake, a burner control thermostat, and

an outer case. Basic residential gas floor and basic gas room heaters rely on gravity for

air circulation. Basic residential wall gravity, floor, and room heaters differ primarily in

the enclosure design and how they are installed. Vented gas hearth DHE, sold as

fireplaces, fireplace inserts, or gas stoves, can be used to provide residential space

heating, while also simulating wood­burning products. A basic vented hearth product

consists of a heat exchanger, a standing pilot ignition system, a burner, a pilot light

sensing control valve, a combustion chamber, a flue/vent, an air intake, a burner control

thermostat, ceramic logs, an outer case, and a glass viewing pane.

Residential pool heaters raise the water temperature in pools, allowing use of the

pool when ambient temperatures are low. A basic residential gas pool heater is comprised

of an outer case, a combustion chamber with refractory, a standing pilot ignition system,

a pilot light sensing control valve, a burner, a heat exchanger, an air intake, a flue/vent, a

cold water inlet and hot water outlet, pressure and water safety switches, and a burner

control thermostat with user interface.

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3.1.2 Definitions

The National Appliance Energy Conservation Act (NAECA) established the

definition of a “residential water heater” (42 United States Code (U.S.C.) 6291(27)) as

follows:

Residential water heater means a product that uses oil, gas, or electricity to heat

potable water for use outside the heater upon demand, including –

1.	 Storage­type units which heat and store water at a thermostatically controlled

temperature, including gas storage water heaters with an input of 75,000

British thermal units [Btu] per hour [h] or less, oil storage water heaters with

an input of 105,000 Btu per hour or less, and electric storage water heaters

with an input of 12 kilowatts [kW] or less;

2.	 Instantaneous­type units which heat water, but contain no more than one

gallon of water per 4,000 Btu per hour of input, including gas instantaneous

water heaters with an input of 200,000 Btu per hour or less, oil instantaneous

water heaters with an input of 210,000 Btu per hour or less, and instantaneous

electric water heaters with an input of 12 kilowatts or less; and,

3.	 Heat pump­type units, with a maximum current rating of 24 amperes at a

voltage no greater than 250 volts, which are products designed to transfer

thermal energy from one temperature level to a higher temperature level for

the purpose of heating water, including all ancillary equipment such as fans,

storage tanks, pumps, or controls necessary for the device to perform its

function. Section 430.2 of 10 Code of Federal Regulations (CFR).

The definition of a residential water heater is further described in appendix E to

subpart B of part 430 of 10 CFR as follows:

1.	 Gas­Fired Storage­Type Water Heater means a water heater that uses gas as

the energy source, is designed to heat and store water at a thermostatically

controlled temperature of less than 180 °F [degrees Fahrenheit] (82 °C

[degrees Celsius]), has a nominal input of 75,000 Btu (79 MJ [megajoules])

per hour or less, and has rated storage capacity of not less than 20 gallons (76

liters) nor more than 100 gallons (380 liters);

2.	 Oil­Fired Storage­Type Water Heater means a water heater that uses oil as the

energy source, is designed to heat and store water at a thermostatically

controlled temperature of less than 180 °F (82 °C), has a nominal input of

105,000 Btu/h (110 MJ/h) or less, and has a manufacturer’s rated storage

capacity of 50 gallons (90 liters) or less;

3.	 Electric Storage­Type Water Heater means a water heater that uses electricity

as the energy source, is designed to heat and store water at a thermostatically

controlled temperature of less than 180 °F (82 °C), has a nominal input of 12

kilowatts (40,956 Btu/h) or less, an has a rated storage capacity of not less

than 20 gallons (76 liters) nor more than 120 gallons (450 liters);

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4.	 Tabletop Water Heater means a water heater in a rectangular box enclosure

designed to slide into a kitchen countertop space with typical dimensions of

36 inches high, 25 inches deep and 24 inches wide;

5.	 Instantaneous Gas­fired water heater means a water heater that uses gas as the

energy source, initiates heating based on sensing water flow, is designed to

deliver water at a controlled temperature of less than 180 °F (82 °C), has an

input greater than 50,000 Btu/h (53 MJ/h) but less than 200,000 Btu/h (210

MJ/h), and has a manufacturer’s specified storage capacity of less than 2

gallons (7.6 liters); and,

6.	 Instantaneous Electric Water Heater–Reserved

The energy conservation standards for residential water heaters are represented in

terms of the energy factor (EF) in appendix E of subpart B, section 430 of 10 CFR. (42

U.S.C. 6295(e)(1)) The EF is the ratio of the heat delivered to the energy consumed

according to the specific test procedure for residential water heaters. The EF accounts for

both recovery efficiency and standby losses at prescribed patterns of hot­water draws

totaling 64.3 gallons per day.

In DOE’s existing regulations, four types of residential heating equipment are

referred to as direct heating equipment. DOE refers to these four types of heating

equipment (i.e., wall fan DHE, wall gravity DHE, floor DHE, and room DHE) as

“traditional” DHE in the NOPR associated with this TSD. In the NOPR, DOE proposes

to define a fifth type of direct heating equipment—gas hearth DHE. DOE defines vented

home heating equipment as “home heating equipment, not including furnaces, designed

to furnish warmed air to the living space of a residence, directly from the device, without

duct connections (except that boots not to exceed 10 inches beyond the casing may be

permitted) and includes: vented wall furnace, vented floor furnace, and vented room

heater.” Section 430.2 of 10 CFR.

Section 430.2 defines a vented wall furnace (gravity type and fan type), vented

floor furnace, and vented room heater:

1.	 Vented wall furnace means a self­contained vented heater complete with

grilles or the equivalent, designed for incorporation in, or permanent

attachment to, a wall of a residence and furnishing heated air circulated by

gravity or by a fan directly into the space to be heated through openings in

the casing.

2.	 Vented floor furnace means a self­contained vented heater suspended from

the floor of the space being heated, taking air from combustion from

outside this space. The vented floor furnace supplies heated air circulated

by gravity or by a fan directly into the space to be heated through openings

in the casing.

3.	 Vented room heater means a self­contained, free standing, nonrecessed,

vented heater for furnishing warmed air to the space in which it is

installed. The vented room heater supplies heated air circulated by gravity

or by a fan directly into the space to be heated through openings in the

casing.

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Before the enactment of NAECA, EPCA included home heating equipment in

DOE’s appliance standards program. DOE construed this term as covering unvented as

well as vented products, and prescribed a separate test procedure for each. 43 FR 20128,

20132 (May 2, 1978). However, when NAECA replaced the term “home heating

equipment” with “direct heating equipment” in NAECA’s amendments to EPCA in 1987

(42 U.S.C. 6295(e)(3)), the new energy conservation standards for this equipment

affected only gas products. The statutorily prescribed standards used the AFUE

descriptor, which applies only to vented equipment. The AFUE represents the heat

transferred to the conditioned space divided by the fuel energy supplied. Because of the

limitation imposed by the statute's use of the AFUE descriptor, subsequent DOE actions

concerning direct heating equipment have focused solely on vented products.

DOE defines a pool heater under NAECA as “an appliance designed for heating

nonpotable water contained at atmospheric pressure, including heating water in

swimming pools, spas, hot tubs and similar applications.” (42 U.S.C. 6291(25))

The energy conservation standard for pool heaters is represented by the thermal

efficiency. Section 430.32(k) of 10 CFR. (42 U.S.C. 6295(e)(2)) Thermal efficiency

represents the heat transferred to the nonpotable water divided by the fuel energy

supplied.

3.1.3 Product Classes

DOE categorized the product types (i.e., residential water heaters, residential

direct heating equipment, and pool heaters) into product classes and will formulate a

separate energy conservation standard for each class. The criteria for separation into

different classes are type of energy used, capacity, and other performance­related features

such as those that provide utility to the consumer or others deemed appropriate by the

Secretary that would justify the establishment of a separate energy conservation standard.

(42 U.S.C. 6295(q) and 6316(a)) For residential water heaters, the product classes are

based on energy source (i.e., gas or electric) and design (i.e., storage­type, tabletop, and

instantaneous or “tankless”). The product classes shown in Table 3.1.1 were established

by the January 17, 2001, Energy Conservation Standards for Water Heaters Final Rule

(the January 2001 final rule) amending the energy conservation standards for residential

water heaters and incorporated into section 430.32(d). 66 FR 4474, 4497 (January 17,

2001).

Table 3.1.1 Product Classes for Residential Water Heaters

Residential Water Heater Type Characteristics

Gas­Fired Storage Type Nominal input of 75,000 Btu/h or less; rated storage volume from 20 to

100 gallons

Oil­Fired Storage Type Nominal input of 105,000 Btu/h or less; rated storage volume of 50

gallons or less

Electric Storage Type Nominal input of 12 kW (40,956 Btu/h) or less; rated storage volume

from 20 to 120 gallons

Tabletop Dimensions of 36 inches high, 25 inches deep, and 24 inches wide

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Instantaneous Gas­Fired Nominal input of over 50,000 Btu/h up to 200,000 Btu/h; rated storage

volume of 2 gallons or less

Instantaneous Electric Input of 12 kW or less; contains no more than one gallon of water per

4,000 Btu/h of input

Table 3.1.2 shows the product classes for direct heating equipment established by

NAECA. (42 U.S.C. 6295(e)(3)) However, DOE has proposed reducing the number of

heating capacity ranges for direct heating equipment to better reflect the distribution of

direct heating equipment available on the market. In addition, DOE has proposed adding

a separate product class of direct heating equipment–gas hearth DHE (Table 3.1.2).

Table 3.1.2 Proposed Product Classes for Direct Heating Equipment

Direct Heating Equipment Type Heating Capacity (Btu/h)

Gas Wall Fan Type Up to 42,000

Over 42,000

Up to 27,000

Gas Wall Gravity Type Over 27,000 up to 46,000

Over 46,000

Gas Floor Up to 37,000

Over 37,000

Up to 20,000

Gas Room Over 20,000 up to 27,000

Over 27,000 up to 46,000

Over 46,000

Up to 20,000

Gas Hearth Over 20,000 up to 27,000

Over 27,000 up to 46,000

Over 46,000

Gas hearth direct heating equipment class description. Vented gas hearth

products, sold as fireplaces, fireplace inserts, or gas stoves, can be used to provide

residential space heating. When used to furnish heat to a living space, vented gas hearth

DHE provides the same function and utility as vented heaters. The definition for vented

home heating equipment (or vented heater) in 10 CFR 430.2 states that this equipment is

“... a class of home heating equipment, not including furnaces, designed to furnish

warmed air to the living space of a residence, directly from the device, without duct

connections (except that boots not to exceed 10 inches beyond the casing may be

permitted) and includes: vented wall furnace, vented floor furnace, and vented room

heater.” Vented gas hearth DHE furnish warmed air to the living space of a residence,

directly from the device, without duct connections. Therefore, the vented heater

definitions stated previously include vented hearth products.

The energy conservation standards for direct heating equipment apply to a vented

hearth product if the product is designed to provide the same function and utility as

vented heaters by supplying heat to the space in which it is installed. In addition to space

heating, gas hearth DHE also provide aesthetic utility. When compared to gas wall

furnaces or gas room heaters, they must use different technologies to achieve improved

efficiency than traditional DHE. The constraints placed on gas hearth DHE, such as the

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glass viewing panes and consumer demand for a “yellow­flame” that simulates a woodburning fireplace make it difficult for hearth product manufacturers to achieve the same

efficiency increases with the same methods used by gas wall furnace and gas room heater

manufacturers. Therefore, DOE is proposing in the NOPR to include the following

definition for vented gas hearth direct heating equipment: “Vented hearth heater means a

vented, freestanding, recessed, zero clearance fireplace heater, a gas fireplace insert or a

gas­stove, which simulates a solid fuel fireplace and is designed to furnish warm air,

without ducts to the space in which it is installed.”

For pool heaters, the only product class is gas­fired pool heaters, which is

established by NAECA. (42 U.S.C. 6295(e)(2))

3.1.4 Product Test Procedures

Test procedures already exist for all three products covered by this rulemaking.

DOE established test procedures for residential water heaters, residential direct heating

equipment, and pool heaters through the rulemaking process, initially established by a

final rule published on October 17, 1990, and codified in appendix E to subpart B of 10

CFR part 430. 55 FR 42163. DOE amended the residential water heater test procedure on

May 11, 1998, by adding the following provisions: (1) a revision to the method used in

determining the first hour rating of storage­type water heaters, (2) an additional rating for

electric and instantaneous gas­fired water heaters, and (3) a revision to the definition of a

heat pump water heater. 63 FR 25996. On July 20, 1998, DOE published in the Federal

Register a correction to the May 1998 final rule, which added residential water heater

testing schematics. 63 FR 38737. Along with the amended energy conservation standards

published in the January 2001 final rule, DOE also amended the test procedure by adding

a definition for tabletop water heaters and reaffirming the test methods specified in

appendix E to subpart B of 10 CFR Part 430. 66 FR 4476.

DOE prescribed a test procedure for vented types of gas­fired direct heating

equipment in a notice published in the Federal Register on May 2, 1978. 43 FR 20182.

On May 12, 1997, DOE published a final test procedure rule that amended the test

procedures for direct heating equipment, and, in particular, vented home heating

equipment. 62 FR 26140. The May 1997 final rule included modified calculation

procedures for the weighted­average steady­state efficiency and AFUE for certain

manually controlled heaters, and added a procedure for calculating the annual energy

consumption of fossil fuel and auxiliary electrical energy for these types of products.

On May 12, 1997, DOE also published in the Federal Register a final rule that

amended the test procedure for pool heaters. 62 FR 26140. The May 1997 final rule

updated the referenced American National Standards Institute (ANSI) standard for pool

heaters from ANSI Standard Z21.56­1986, Gas­Fired Pool Heaters, to ANSI Standard

Z21.56­1994, Gas­Fired Pool Heaters. This update added a procedure for calculating the

annual energy consumption of fossil fuel auxiliary electrical energy for pool heaters and a

seasonal efficiency descriptor. 62 FR 26141.

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3.2 MARKET ASSESSMENT
 

The following market assessment identifies the manufacturer trade associations;

domestic and international manufacturers of residential water heaters, direct heating

equipment and pool heaters, and their corresponding market shares; and regulatory and

non­regulatory programs. The market assessment also provides historical shipment data;

describes the cost structure for the residential water heater, direct heating equipment, and

pool heater industries; and summarizes relevant market performance data for each

product type.

3.2.1 Trade Associations

DOE recognizes the importance of trade groups in disseminating information and

providing growth to the industry they support. To gain insight into the residential water

heater, direct heating equipment, and pool heater industries, DOE researched various

associations available to manufacturers, suppliers, and users of such equipment. DOE

also used the member lists of these groups to construct a database of domestic

manufacturers.

DOE identified several trade groups that support or have an interest in the

residential water heater, direct heating equipment, and pool heater industries, including

AHRI, the Hearth, Patio & Barbecue Association (HPBA), and the Association of Pool

and Spa Professionals (APSP).

3.2.1.1 Air­Conditioning, Heating, and Refrigeration Institute

AHRIb is a national trade association of manufacturers of residential, commercial,

and industrial appliances and equipment, components and related products. AHRI was

established in January of 2008, when the Air­Conditioning and Refrigeration Institute

(ARI) merged with the Gas Appliance Manufacturers Association (GAMA). AHRI's

scope includes gas­fired, oil­fired, and electric products and equipment. “(AHRI)

members are responsible for more than 90 percent of space and water heating shipments

in the United States” during 2007.2 “[AHRI] helps its members stay abreast of relevant

legislative and regulatory developments; supports the development of improved products

and installation procedures; compiles statistical reports of industry shipments; sponsors

and coordinates advertising and consumer education programs; and sponsors efficiency

certification programs for space heating, water heating, air­conditioning, and refrigeration

products and equipment.”3 AHRI maintains the AHRI Efficiency Certification Program.

AHRI also maintains a database of products and equipment tested under its certification

program on its website. The majority of heating products currently manufactured by

member and non­member manufacturers are included in this database.c Table 3.2.1 shows

manufacturers of products covered by this rulemaking represented in AHRI’s Consumers'

Directory of Certified Efficiency Ratings for Heating and Water Heating Equipment

(hereafter the AHRI directory).

b For more information, please visit www.ahrinet.org. c For more information, please visit www.gamapower.org.

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Table 3.2.1 Manufacturers Whose Products Are Included in the AHRI Directoryd

Residential Water Heaters Direct Heating Equipment Pool Heaters

A.O. Smith Corporation CFM Corporation Hayward Industries, Inc.

Bock Water Heaters, Inc. Empire Comfort Systems,

Inc.

Jandy Pool Products, Inc.

Bradford White Corporation Lennox Hearth Products Lochinvar Corporation

Bosch Water Heating Louisville Tin and Stove

Co.

Pentair, Inc.

ECCOTEMP, LLC Rinnai Corporation Raypak

Heat Transfer Products, Inc. Williams Furnace Company

Lochinvar Corporation

Rheem­Ruud

Rinnai America

Corporation

Takagi Industrial Co. USA

Vaughn Manufacturing

Corporation

The majority of residential water heater, direct heating equipment, and pool heater

manufacturers identified in section 3.2.2.1 are represented by AHRI.

3.2.1.2 Hearth, Patio & Barbecue Association

HPBA “includes manufacturers, retailers, distributors, manufacturers'

representatives, service and installation firms, and other companies and individuals ­ all

having business interests in and related to the hearth, patio, and barbecue products

industries.”4e

3.2.1.3 Association of Pool and Spa Professionals

APSP is an “international trade association and leading industry advocate

representing the swimming pool, spa, and hot tub industry.”5 APSP also delivers public

relations, advertising, and water safety messages to consumers, and maintains industry

data and statistics on the pool and spa industries. Members can obtain information on the

products available to consumers, historical and geographical pool and spa installation

statistics, and other types of data. Additionally, the APSP offers pool and spa

professionals resources and tools to assist in business operations.

d A.O Smith Water Corporation refers to A. O. Smith Water Products Company, A. O. Smith Water

Heaters, State Water Heaters, Reliance Water Heater Company, Apollo Hydroheat and Cooling, Maytag

Water Heaters, American Water Heater Company, GSW Water Heating, and John Wood Water Heaters.

Bosch Water Heating is a division of Bosch USA, which is a branch of Bosch Group. Rheem­Ruud refers

to Rheem Manufacturing Company, Ruud Water Heating, the Paloma Group, and Paloma Tankless. Rinnai

America Corporation and Rinnai Corporation are subsidiaries of Rinnai Japan. Takagi Industrial Company

USA is a division of Takagi. Lennox Hearth Products refers to Lennox International, Incorporated.

Williams Furnace Company is a subsidiary of Continental Materials Corporation. Pentair refers to Pentair

Water Pool and Spa, Incorporated. Raypak refers to Raypak, Incorporated. e For more information, visit www.hpba.org/index.php?id=46.

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3.2.2 Manufacturer Information
 

The following section provides information about manufacturers of residential

water heaters, direct heating equipment, and pool heaters, including estimated market

shares, potential small business impacts, and product distribution channels.

3.2.2.1 Manufacturers and Market Shares

Using publicly available data (e.g., Appliance Magazine and market assessments

from third parties), DOE estimated the market shares for manufacturers of each of the

three products contained in this standards rulemaking. Manufacturers may offer multiple

brand names.

DOE estimates that there are approximately 26 domestic manufacturers of

residential water heaters.6 The large majority of the domestic market is controlled by

three U.S. manufacturers: Rheem­Rudd, A.O. Smith Corporation (including State

Industries and American Water Heater), and Bradford­White.7 Five manufacturers hold

most of the remaining domestic market share, including: Bock Water Heaters, Inc.;

Bosch Water Heating; Noritz America; Rinnai America Corporation; and Takagi

Industrial Co. USA. Table 3.2.2 lists these manufacturers.

Table 3.2.2 Major and Other Residential Water Heater Manufacturers

Major Manufacturers* Other Manufacturers

Rheem­Ruud Bock Water Heaters, Inc.

A. O. Smith Corporation Bosch Water Heating

Bradford White Corporation Noritz America

Rinnai America Corporation

Takagi Industrial Co. USA

* Manufacturers with 10 percent or more of market share.

Figure 3.2.1 shows the 2006 market shares for domestic residential water heater

manufacturers as depicted in the September 2007f issue of Appliance Magazine, except

that A.O. Smith and American Water Heater’s market shares are combined. As noted

above, A.O. Smith acquired GSW Inc., the parent company of American Water Heater,

on April 3, 2006. A.O. Smith’s market share now includes the market share once held by

American Water Heater, and thus, DOE combined A.O. Smith and American Water

Heater’s market share using the most recent data available to represent the current water

heater market shares.

f Appliance Magazine last published market share figures for the residential water heater market in

September 2007.

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Figure 3.2.1 2006 Market Shares for the Domestic Residential Water Heaters8

The residential water heater market can be further divided into manufacturers of

gas, oil­fired, and electric storage water heaters, and gas or electric instantaneous water

heaters. Table 3.2.3 shows manufacturers that produce these types of residential water

heaters.

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Table 3.2.3 Residential Water Heater Manufacturers by Technology Type
 

Manufacturer

Residential Water Heater Type

Gas

Storage

Oil­Fired

Storage

Electric

Storage Instantaneous Gas Instantaneous

Electric

A. O. Smith Corporation X X X X

Bock Water Heaters, Inc. X X

Bosch Water Heating X X

Bradford White

Corporation

X X X

ECCOTEMP, LLC X

Heat Transfer Products,

Inc.

X

Lochinvar Corporation X X

Noritz X

Rheem­Ruud X X X

Rinnai America

Corporation

X

Takagi Industrial Co.

USA

X

Vaughn Manufacturing X

TOTALS 5 4 5 6 1

DOE estimates that there are four domestic manufacturers of traditional direct

heating equipment and 16 manufacturers of gas hearth DHE.g Table 3.2.4 and Table 3.2.5

list these manufacturers.

Table 3.2.4 Gas­Fired Traditional Direct Heating Equipment Manufacturers

Major Manufacturers* Other Manufacturers

Empire Comfort Systems, Inc. Monitor Products, Inc.

Louisville Tin and Stove Co. United States Stove Company

Williams Furnace Company**

*Major manufacturers have at least 10% market share.
 

** Williams Furnace Company is a subsidiary of Continental Materials Corporation.
 

g Estimate based on membership in AHRI (former GAMA members), membership in HPBA, and online

product searches.

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Table 3.2.5 Gas Hearth DHE Direct Heating Equipment Manufacturersh

Major Manufacturers Minor Manufacturers

Hearth & Home Technologies, Inc. Blaze King Industries

Lennox International Inc Buck Stove Corporation

Monessen Hearth Systems Co Breckwell Hearth Products

Empire Comfort Systems Inc

Golden Blount, Inc

Hearthstone Quality Home Heating

Products, Inc.

Hussong Mfg. Co., Inc.

Jøtul North America, Inc.

Mendota Hearth Products

Thelin Co. Inc

Travis Industries, Inc.

Wolf Steel Inc. (Napoleon Fireplaces)

Due to the small total size of the traditional direct heating equipment market and

confidentiality concerns, DOE was unable to disclose any market share data for

traditional direct heating equipment manufacturers or hearth equipment manufacturers.

DOE divided manufacturers into “major” and “other” based on the current industry

characteristics, DOE research, and discussions with manufacturers. Major companies

have larger market shares.

DOE identified five domestic manufacturers of residential gas­fired pool heaters.

Table 3.2.6 lists these manufacturers.

Table 3.2.6 Gas­Fired Pool Heater Manufacturersi

Major Manufacturers* Other Manufacturers

Hayward Industries, Inc. Lochinvar Corporation

Jandy Pool Products, Inc.

Raypak

Pentair

*Major manufacturers have at least 10% market share.

Due to the small total size of the pool heater market and confidentiality concerns,

DOE was unable to disclose any market share data for residential pool heater

manufacturers. DOE divided pool heater manufacturers into “major” and “other”

categories based on the current industry characteristics, DOE research, and discussions

with manufacturers. Major companies have larger market shares.

3.2.2.2 Small Business Impacts

h Lennox Hearth Products refers to Lennox International, Incorporated. Hearth and Home Technologies is a
 

subsidiary of HNI Corporation.
 i

Raypak refers to Raypak, Incorporated. Pentair refers to Pentair Water Pool and Spa, Incorporated.
 

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DOE realizes that small businesses may be disproportionately affected by the

promulgation of energy conservation standards for residential water heaters, direct

heating equipment, and pool heaters. The Small Business Administration (SBA) defines

small business manufacturing enterprises for residential water heaters, direct heating

equipment, and pool heaters as those having 500 employees or fewer.9 SBA lists small

business size standards for industries as they are described in the North American

Industry Classification System (NAICS). The size standard for an industry establishes the

largest size that a for­profit entity can be while still qualifying as a small business for

Federal Government programs. These size standards are generally expressed in terms of

the average annual receipts or the average employment of a firm. Residential water heater

and pool heater manufacturing are classified under NAICS 335228, “Other Major

Household Appliance Manufacturing,” and direct heating equipment is classified under

NAICS 333414, “Heating Equipment (except warm air furnaces) Manufacturing.” The

size standard is 500 employees or fewer for both NAICS codes.

DOE studied the potential impacts on these small businesses as a part of the

manufacturer impact analysis (chapter 12). Table 3.2.7 lists the small business residential

water heaters, direct heating equipment, and pool heating manufacturers that DOE

identified.

Table 3.2.7 Small Business Manufacturers of Residential Water Heaters, Direct

Heating Equipment, and Pool Heaters

Water Heaters Direct Heating Equipment Pool Heaters

Bock Water Heaters Empire Comfort Systems, Inc. Lochinvar Corporation

ECCOTEMP SYSTEMS, LLC Louisville Tin and Stove Co.

Heat Transfer Products, Inc. Blaze King Industries

Therma­Flow, Inc. Breckwell Hearth Products

Vaughn Manufacturing

Corporation Buck Stove Corporation

Golden Blount, Inc

Hearthstone Quality Home Heating

Products, Inc.

Hussong Mfg. Co, Inc. (Kozy Heat)

Mendota Hearth Products

Thelin Co. Inc

Travis Industries, Inc

United States Stove Company

3.2.3 Distribution Channels
 

Analysis of the distribution channels of products covered by this rulemaking is an

important facet of the market assessment. DOE gathered information from publicly

available sources regarding the distribution channels for residential water heaters, direct

heating equipment, and pool heaters.

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The residential water heater market can be divided into two areas: replacement of

existing units and new construction. Between 49 and 59 percent of residential water

heaters are distributed through wholesalers.10 These wholesalers then resell residential

water heaters to contractors and plumbers, plumbing supply houses, local hardware

stores, and other retail channels. For gas instantaneous water heaters in particular, the

wholesale distribution channel accounts for an even larger percentage. Residential water

heaters are also sold through retail distribution (between 41 and 51 percent).11 These

residential water heaters are sold directly by residential water heater manufacturers to

home improvements stores, chain hardware stores, and other large retailers. According to

DOE’s 2000 water heater technical support document (TSD), approximately 60 percent

of replacements were sold through the retail distribution channel.12 Alternatively,

customers may purchase a residential water heater and install it themselves or hire a

contractor to complete the installation. Homebuilders, contractors, and plumbers purchase

residential water heaters for new construction.

Appliance Magazine’s 56th annual statistical review stated that 8.19 million

residential water heaters were shipped in 2008.13 According to the Northwest Energy

Efficiency Alliance (NEEA)’s analysis of residential water heater distribution channels,

20 percent were purchased by homebuilders for use in new construction. The remaining

80 percent of sales were retrofit units replacing existing residential water heaters. Of

these retrofit units, approximately 52 percent were purchased and installed by consumers,

and approximately 48 percent were installed by contractors and plumbers.14

For analysis purposes, DOE defined four distribution channels for residential

water heaters: Replacement A, Replacement B, New Homes A, and New Homes B.

(Figure 3.2.2).

Figure 3.2.2 Water Heaters Distribution Channel

Consumer purchases and installations typically do not play a role in the

established distribution channels of direct heating equipment. For replacement

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applications, most sales go through distributors to contractors, and then to consumers. In

new home applications, most sales go through distributors to contractors hired by the

builder. Thus, DOE defined two distribution channels for analysis purposes: Replacement

and New Homes (Figure 3.2.3).

Figure 3.2.3 Direct Heating Equipment Distribution Channel

For pool heaters in replacement applications, most sales go through distributors or

retailers to pool service companies. In most new home applications, the pool builder

purchases the equipment from a distributor or wholesaler. Thus, DOE defined two

distribution channels for analysis purposes: Replacement and New Homes (Figure 3.2.4).

Figure 3.2.4 Pool Heater Distribution Channel

3.2.4 Regulatory Programs

The following section details current regulatory programs mandating energy

conservation standards for residential water heaters, direct heating equipment, and pool

heaters. Section 3.2.4.1 discusses current Federal energy conservation standards, and

section 3.2.4.2 provides an overview of existing State standards. Sections 3.2.4.3 and

3.2.4.4 review standards in Canada and Mexico that may affect companies servicing the

domestic market.

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3.2.4.1 Current Federal Energy Conservation Standards

NAECA established energy conservation standards for residential water heaters,

direct heating equipment,jand pool heaters, and required that DOE conduct two cycles of

rulemakings to determine if more stringent standards are economically justified and

technologically feasible for these products. (42 U.S.C. 6295 (e)(1) and (4)) On February

7, 1989 and October 17, 1990, DOE issued a final rule codifying the standards prescribed

by NAECA, and thereby established the first set of energy conservation standards for

residential water heaters, direct water heating equipment, and pool heaters. 54 FR 6077

(February 7, 1989) and 55 FR 42163 (October 17, 1990).

Pursuant to 42 U.S.C. 6295(e)(4)(A), on January 17, 2001, DOE published in the

Federal Register the January 2001 final rule, effective January 20, 2004, amending the

energy conservation standards for residential water heaters. 66 FR 4474.

Table 3.2.8 Federal Energy Conservation Standards for Residential Water Heaters

Residential Water Heater Class Minimum Energy Factor (EF)

Gas­Fired Storage Type 0.67 – (0.0019 x Rated Storage Volume in gallons)

Oil­Fired Storage Type 0.59 – (0.0019 x Rated Storage Volume in gallons)

Electric Storage Type 0.97 – (0.00132 x Rated Storage Volume in gallons)

Instantaneous Gas­Fired Type 0.62 – (0.0019 x Rated Storage Volume in gallons)

Instantaneous Electric Type 0.93 – (0.00132 x Rated Storage Volume in gallons)

Tabletop 0.93 – (0.00132 x Rated Storage Volume in gallons)

DOE initially analyzed energy conservation standards for direct heating

equipment as part of an eight­product standards rulemaking. When DOE analyzed direct

heating equipment in these earlier proceedings, it considered only products categorized as

vented home heating equipment. DOE issued a notice of proposed rulemaking (NOPR)

on March 4, 1994, proposing to amend the energy conservation standards for direct

heating equipment and other consumer products. 59 FR 10464. The Department of

Interior and Related Agencies Appropriations Act for Fiscal Year 1996 (P.L. 104­134)

imposed a moratorium on proposing or issuing final rules for appliance standards

rulemakings for the remainder of Fiscal Year 1996, thereby preventing DOE from

finalizing the 1994 proposed standards and leaving the existing NAECA efficiency levels

in place. Table 3.2.9 presents these energy conservation standards for direct heating

equipment.

j

Initially, EPCA included vented and unvented home heating equipment in DOE’s appliance standards

program. However, EPCA did not specifically use the term direct heating equipment. NAECA prescribed

energy conservation standards for direct heating equipment instead of vented and unvented home heating

equipment, but NAECA did not include a definition of the products covered under the direct heating

equipment category. Since DOE has established test procedures to measure the energy efficiency of vented

home heating equipment and the test procedures for unvented home heating equipment do not have an

energy efficiency measure, DOE has determined that direct heating equipment only refers to vented home

heating equipment for the purpose of this rulemaking.

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Table 3.2.9 Federal Energy Conservation Standards for Direct Heating Equipment*
 

Direct Heating Equipment Design Type Product Class, by Input Rating

(Btu/h)

AFUE

%

Gas Wall Fan Up to 42,000 73

Over 42,000** 74

Gas Wall Gravity

Up to 10,000 59

Over 10,000 up to 12,000 60

Over 12,000 up to 15,000 61

Over 15,000 up to 19,000 62

Over 19,000 up to 27,000 63

Over 27,000 up to 46,000** 64

Over 46,000 65

Gas Floor Up to 37,000 56

Over 37,000** 57

Gas Room

Up to 18,000 57

Over 18,000 up to 20,000 58

Over 20,000, up to 27,000 63

Over 27,000 up to 46,000 64

Over 46,000** 65

*Includes all of the product classes set forth in the Energy Policy and Conservation Act (EPCA) and codified
 

at 10 CFR Part 430.32(i).
 

**Representative product classes that DOE intends to analyze.
 

As with direct heating equipment, DOE initially analyzed standards for pool

heaters as part of the eight­product standards rulemaking of 1994, 59 FR 10464, but

never finalized the proposed standards (for reasons explained above). DOE has not

amended the energy conservation standards for pool heaters since NAECA established

them in 1987. 42 U.S.C 6295 (e)(2) Existing energy conservation standards for

residential pool heaters specify a thermal efficiency for pool heaters of no less than 78

percent. 10 CFR part 430.32(k).

3.2.4.2 State Energy Conservation Standards

The following States have established appliance energy efficiency regulations:

Arizona, California, Connecticut, Maine, Maryland, Massachusetts, Minnesota, New

Hampshire, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont, and

Washington. Of these, California is the only State that explicitly regulates equipment

covered in this rulemaking.15

The State of California mandates energy conservation standards for residential

water heaters. State standard levels are identical to Federal standard levels for each

covered product. California regulations extend the scope of Federal standards, including

standards for products outside of the rated storage capacity range and input capacity

range stated for the product types covered by Federal standards. Additionally, California

has specific regulations for instantaneous oil­fired water heaters, which are similar to the

Federal standards for oil­fired storage water heaters.16 Table 3.2.10 presents California’s

water heater standards.

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Table 3.2.10 California State Efficiency Standards for Residential Water Heaters17

Appliance Energy

Source

Input Rating Rated

Storage

Volume

gallons

Minimum Energy Factor

Storage Water

Heaters Gas ≤ 75,000 Btu/h < 20 0.62 – (0.0019 x Volume)

Storage Water

Heaters Gas ≤ 75,000 Btu/h > 100 0.62 – (0.0019 x Volume)

Storage Water

Heaters Oil ≤ 105,000 Btu/h > 50 0.59 – (0.0019 x Volume)

Storage Water

Heaters Electricity ≤ 12 kW > 120 0.93 – (0.00132 x Volume)

Instantaneous

Water Heaters Gas ≤ 50,000 Btu/h Any 0.62 – (0.0019 x Volume)

Instantaneous

Water Heaters Gas ≤ 200,000 Btu/h ≥ 2 0.62 – (0.0019 x Volume)

Instantaneous

Water Heaters Oil ≤ 210,000 Btu/h Any 0.59 – (0.00132 x Volume)

Instantaneous

Water Heaters Electricity ≤ 12 kW Any 0.93 – (0.00132 x Volume)

The State of California also mandates energy conservation standards for direct

heating equipment. These standard levels are identical to Federal energy conservation

standard levels.18

California mandates energy conservation standards for pool heaters as well. The

State’s gas­fired pool heater standard is identical to the Federal standard level with an

additional requirement that prohibits the use of constant burning pilots.19 California also

issues standards for oil­fired and electric heat pump pool heaters. Table 3.2.11 provides

these pool heater standards.20

Table 3.2.11 California State Energy Conservation Standards for Pool Heaters21

Residential Pool Heater Type Standard Level

Oil Fired Thermal Efficiency: 78%

Heat Pump Average Coefficient of Performance: 3.5

3.2.4.3 Canadian Standards Association

The Canadian Standards Association (CSA) is an independent standards­setting

agency that establishes test procedures and efficiency standards that are typically adopted

by the Canadian Government.

Residential Water Heaters. CSA has specified energy conservation standards for

residential water heaters. The CSA standards divide residential water heaters into several

categories and subcategories, summarized in Table 3.2.12.

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Table 3.2.12 Canadian Efficiency Standards for Residential Water Heaters22

Water Heater Type Product Class Efficiency Standard

Description

Gas­Fired Storage

Input rating ≤ 21.98 kW

(75,000 Btu/h) and storage

capacity 76 to 380 liters

Minimum EF:

0.67 – 0.0005V

Oil­Fired Storage

Input rating ≤ 30.5 kW

(107,000 kJ/h) and storage

capacity ≤ 190 liters

Minimum EF:

0.59 – 0.0005V

Bottom Inlet

50 to 270 liters Maximum Standby Loss:

40 + (0.20V)

Electric Storage

> 270 to 454 liters Maximum Standby Loss:

(0.472V) – 33.5

Top Inlet

50 to 270 liters Maximum Standby Loss:

35 + (0.20V)

> 270 to 454 liters Maximum Standby Loss:

(0.472V) – 38.5

Note: V=rated storage capacity in liters; EF=energy factor as defined by CSA P.3­04 for gasfired water heaters and CAN/CSA­B211­00 for oil­fired water heaters.

Direct Heating Equipment. Canada has product classes for vented gas fireplaces

and fireplace heaters. Vented gas fireplaces are primarily used for aesthetic purposes,

whereas vented gas fireplace heaters are designed to provide heat to the space where they

are installed. Canada has not issued energy conservation standards for either of these

products classes and did not appear to have plans to issue standards as of April 2009.23

Pool Heaters. CSA has specified an energy conservation standard for gas pool

heaters similar to Federal energy conservation standards. This standard sets a minimum

thermal efficiency of 78 percent.

3.2.4.4 Mexico

Mexico has specified energy conservation standards for gas water heaters. The

Mexican standards divide gas water heaters into domestic and commercial categories,

summarized in Table 3.2.12.

Table 3.2.13 Mexican Efficiency Standards for Water Heaters24

Water Heater Type Product Class Efficiency Standard

Description

Gas Fired Domestic Hot Water Heaters Minimum Thermal Efficiency: 72%

Commercial Hot Water Heaters Minimum Thermal Efficiency: 77%

3.2.5 Voluntary Programs

DOE reviewed several voluntary programs promoting energy efficient residential

water heaters, direct heating equipment, and pool heaters in the United States, including

the American Council for an Energy Efficiency Economy (ACEEE), the Consortium for

3­20

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Energy Efficiency (CEE), the Environmental Protection Agency (EPA) ENERGY STAR

program, the Federal Energy Management Program’s (FEMP) procurement program for

energy­efficient products, various rebate programs offered by local utilities, and the

Super Efficient Gas Water Heating Appliance Initiative (SEGWHAI).

3.2.5.1 American Council for an Energy Efficient Economy

ACEEE k is “dedicated to advancing energy efficiency as a means of promoting

economic prosperity, energy security, and environmental protection.” ACEEE conducts

technical and policy assessments, advises policy makers and program managers, works

collaboratively with businesses and public interest groups, organizes conferences,

publishes books, conference proceedings, and reports, and educates consumers and

businesses.25

ACEEE works with industry to maintain a database of high­efficiency residential

water heaters and offers guidance to consumers on how to improve the efficiency of their

residential water heaters.

3.2.5.2 Consortium for Energy Efficiency

CEEl

, “a nonprofit public benefits corporation, develops initiatives for its North

American members to promote the manufacture and purchase of energy­efficient

products and services. The goal of the organization is to induce lasting structural and

behavioral changes in the marketplace, resulting in the increased adoption of energyefficient technologies.”26

CEE organizes a summary of utility­sponsored rebate and incentive programs for

efficient residential water heaters. This summary is available online to encourage

consumers to purchase efficient residential water heaters and take advantage of utility

rebates.

3.2.5.3 ENERGY STAR

ENERGY STAR,m a voluntary labeling program backed by the U.S.

Environmental Protection Agency (EPA) and DOE, identifies energy efficient products

through a qualification process. To qualify, a product must exceed Federal energy

efficiency standards by a specified amount, or if no Federal standard exists, exhibit

selected energy­saving features. The ENERGY STAR program qualifies the top quartile

of products on the market, meaning that approximately 25 percent of products on the

market meet or exceed the ENERGY STAR levels. On April 1, 2008, ENERGY STAR

set requirements for gas storage water heaters, whole­home gas tankless water heaters,

gas condensing water heaters, heat pump water heaters, and solar water heaters.

k For more information, please visit www.aceee.org. l

For more information, please visit www.cee1.org. m For more information, please visit www.energystar.gov.

3­21

EE-2006-STD-0129 COMMENT 56.10
                         

             

                       

   

       

               

             

           

         

       

                     

               

     

         

       

             

           

       

       

                 

           

     

         

             

               

                     

     

       

                     

                 

                       

                   

                   

                       

                       

                                                

           

ENERGY STAR released the criteria on April 1, 2008. They took effect on

January 1, 2009. Table 3.2.14 summarizes the requirements.

Table 3.2.14 ENERGY STAR Residential Water Heater Criteria Issued on April 1,

200827

Product Type Criteria

Gas Storage Water Heater

•

•

•

Minimum EF of 0.62 (0.67 beginning September 1,

2010)

Minimum first hour rating of 67 gallons

Minimum 6­year warranty on sealed system

Whole­Home Gas Tankless Water Heater

•

•

•

Minimum EF of 0.82

Minimum gallons per minute of 2.5 over a 77 oF rise

Minimum 10­year warranty on heat exchanger and 5

years on parts

Gas Condensing Storage Water Heater

•

•

•

Minimum EF of 0.80

Minimum first hour rating of 67 gallons

Minimum 8­year warranty on sealed system

Heat Pump Water Heater

•

•

•

Minimum EF of 2.0

Minimum first hour rating of 50 gallons per hour

Minimum 6­year warranty on sealed system

Solar Water Heater

•

•

•

Minimum Solar Fraction of 0.5

OG­300 certification from the SRCC (Solar Rating

and Certification Corporation)

Minimum 10­year warranty on solar collector, 6 years

on storage tank, 2 years on controls, and 1 year for

piping and parts

3.2.5.4 Federal Energy Management Program

“DOE’s FEMP n works to reduce the cost and environmental impact of the

Federal Government by advancing energy efficiency and water conservation, promoting

the use of distributed and renewable energy, and improving utility management decisions

at Federal sites.”28 FEMP helps Federal buyers identify and purchase energy­efficient

equipment.

FEMP designates standards for water heaters purchased by the Federal

Government. The designated FEMP gas water heater standards levels appear in Table

3.2.15, and the FEMP electric water heater standards appear in Table 3.2.16.

n For more information, please visit www.eere.energy.gov/femp.

3­22

EE-2006-STD-0129 COMMENT 56.10
           

         

             

           

         

             

             

   

                 

                       

          

      

           

           

        

           

       

                 

   

                       

         

       

           

               

                       

                     

                     

                       

                  

Table 3.2.15 FEMP Gas Water Heater Performance Requirements29

Storage Tank Volume Energy Factor

50 gallons or less 0.62 or higher

Table 3.2.16 FEMP Electric Water Heater Performance Requirements30

Storage Tank Volume Energy Factor

Less than 60 gallons 0.93 or higher

60 gallons or more 0.91 or higher

3.2.5.5 Rebate Programs

Several utilities offer rebate programs for high­efficiency residential water

heaters. A small sample of these programs is listed in Table 3.2.17.

Table 3.2.17 Sample Rebate Programs

State Utility Product Requirement Value

$

California Pacific Gas and Electric

Company (PG&E)31 Water Heaters

Gas Storage: EF ≥ 0.62 and

capacity ≥ 30 gallons

Electric Storage: EF ≥ 0.93 and

capacity ≥ 40 gallons

$30

Florida Central Florida Gas32 Gas Water

Heaters

Storage and tankless installation

or replacement $350­$525

Illinois City Water Light and Power33 Water Heaters New electric installation or gas

replacement and capacity ≥ 30

gallons

$200

Texas Austin Energy34 Water Heaters New replacement $100

3.2.5.6 Super­Efficient Gas Water Heating Appliance Initiative

The Super­Efficient Gas Water Heating Appliance Initiative (SEGWHAI) states

that it “will develop and implement the next generation of cost­effective and highefficiency storage­type gas water heater. SEGWHAI will facilitate the development and

commercialization of this next generation of standard water heater. SEGWHAI will

develop a well funded incentive program to make mass commercialization possible for

gas storage water heater units that meet SEGWHAI performance specifications.”35

3­23

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3.2.6 Historical Shipments

Annual product shipment trend data are an important aspect of the market

assessment and development of the standards rulemaking. Such data are used in the

shipments analysis (chapter 9). The number of unit shipments is expected to follow a

trend similar to that of new home starts. However, the percentage of consumers with

multiple units of some appliances is expected to rise, causing unit shipments of certain

appliances to increase, or not to drop as quickly as they otherwise would have.

3.2.6.1 New Home Starts

Trends in new home starts may directly affect shipments of residential water

heaters, direct heating equipment, and pool heaters. While there is a market for both

replacement and remodeling for some of these products, residential water heaters are

fixtures in virtually all new homes.

Figure 3.2.5 presents the number of new single­family and multifamily housing

units started in the United States from 1990 to 2007. Between 2000 and 2005, singlefamily home starts increased 39.4 percent and peaked at 1,716,000 units annually. This

trend reversed to a 63.8 percent decrease from 2005 to 2008, when home starts fell to

622,000 units.o The result is an overall decrease in new home starts of 51 percent

between 2000 and 2008. Multifamily unit starts have remained relatively steady over the

past 7 years, hovering around 350,000 units annually.36

o Fourth quarter 2008 data are preliminary.

3­24

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0

200

400

600

800

1000

1200

1400

1600

1800

2000

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Housing Units Started (thousands)

Year

Single­Family Units

Multi­Family Units

Figure 3.2.5 New Privately Owned Single­Family and Multifamily Housing Unit

Starts in the United States, 1990­200837

3.2.6.2 Shipments

Information about annual equipment shipment trends allows DOE to estimate the

impacts of energy conservation standards on the residential water heater, direct heating

equipment, and pool heater industries. DOE has examined unit shipments and value of

shipments for residential water heaters, direct heating equipment, and pool heaters using

publicly available data from the U.S. Census Bureau’s Annual Survey of Manufacturers

(ASM) and Current Industrial Reports (CIR), and the American Society of Heating,

Refrigerating, and Air­Conditioning Engineers (ASHRAE) and AHRI estimates.

3.2.6.3 Water Heater Unit Shipments

The U.S. Census Bureau’s annual CIR provides annual unit shipments and value

of shipments for various industries, including the residential water heater industry. The

CIR however, does not distinguish between shipments for new construction and

replacement.

Figure 3.2.6 presents the annual shipments of residential water heaters (domestic

and imported shipments) from 2001 to 2007 based on the annual CIRs.38

The numbers show two trends that affect the residential water heater industry.

Overall, shipments of electric and non­electric water heaters have declined since 2001.

However, shipments of non­electric water heaters have declined more rapidly than

shipments of electric water heaters. In 2006 and 2007, shipments of electric water heaters

exceeded shipments of non­electric water heaters.

3­25

EE-2006-STD-0129 COMMENT 56.10
   

   

                 

                       

               

                   

   

   

  

   

  

   

      

             

                 

               

         

                       

                             

                             

                       

                       

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

10,000,000

2001 2002 2003 2004 2005 2006 2007

Units Shipped

Year

Total

Non­electric Water Heaters

Electric Water Heaters

Figure 3.2.6 Residential Water Heater Industry Shipments (Domestic and

Imported)39

Table 3.2.18 presents the annual shipments of the residential water heater industry

from 2003 to 2007 as estimated by AHRI.

Table 3.2.18 AHRI Residential Water Heater Industry Estimated Shipment Data

(New Construction and Replacement)*40

Year Electric,

Storage Water

Heaters

units

Gas, Storage

Water

Heaters

units

Oil­Fired,

Storage Water

Heaters**

units

Gas

Instantaneous

Water Heaters†

units

Total

units

2007 4,470,000 4,384,000 24,000 322,000 9,200,000

2006 4,792,000 4,654,000 22,000 242,000 9,710,000

2005 4,519,000 4,801,000 26,000 156,000 9,502,000

2004 4,573,000 5,054,000 23,000 85,000 9,735,000

2003 4,430,000 5,124,000 24,000 N/A 9,578,000

* Shipments rounded to nearest 1,000 units.

** Only showing shipments for 30­ and 32­gallon models.

† Shipment data not available for all years.

3.2.6.4 Water Heater Value of Shipments

Table 3.2.19 provides the value of shipments for the residential water heater

industry from 2000 to 2007 using the U.S. Census Bureau CIRs.41 The CIR expresses all

dollar values in current dollars (i.e., 2003 data are expressed in 2003$, etc.). Using the

Gross Domestic Product (GDP) Deflator, DOE converted each year’s shipment values to

2008$; 2007 was the last year included in the CIR data set.

3­26

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Table 3.2.19 Residential Water Heater Value of Shipments by Year42

Year

Value of Shipments

$ millions

Value of Shipments in 2008$

$ millions

Non­Electric Electric Total Non­Electric Electric Total

2007 863.0 622.5 1485.5 887.4 640.1 1527.5

2006 902.8 651.9 1,554.7 947.3 684.0 1631.4

2005 970.2 638.4 1,608.6 1050.9 691.5 1742.4

2004 884.1 545.3 1,429.4 988.9 609.9 1598.8

2003 985.6 569.5 1,555.1 1138.4 657.8 1796.2

2002 842.0 576.0 1,418.0 990.3 677.5 1667.8

2001 799.3 555.7 1,355.0 955.6 664.4 1620.0

2000 843.6 572.7 1,416.3 1032.8 701.1 1734.0

According to the data, non­electric and electric water heaters have had a relatively

constant value of shipments between 2000 and 2007. Although the number of electric

water heater shipments exceeded the number of non­electric water heater shipments in

2006, the value of non­electric water heater shipments continued to exceed the value of

electric water heater shipments even as the number of non­electric water heater shipments

declined.

3.2.6.5 Direct Heating Equipment Shipments

The direct heating industry does not report information about direct heating

equipment shipments in as much detail as the water heater industry due to confidentiality

concerns. DOE received shipment data from AHRI on traditional types of direct heating

equipment (i.e., wall furnaces, floor furnaces, and room heaters). Information is not

available for every year, and some information was omitted to preserve confidentiality.

Generally, the traditional direct heating product industry had small sales volumes and a

decline in shipments. Some products, e.g., floor furnaces, are sold strictly as replacement

products. Expansion of the consumer base to increase shipments is unlikely because in

recent years more consumers are installing central heating systems instead of using direct

heating methods to heat their homes. In contrast, there are much higher shipment

volumes for gas hearth DHE, which are installed in new construction. Gas hearth DHE

are desirable because of their aesthetic appeal in addition to their heating capabilities.

DOE obtained the shipments data for gas­fired fireplaces from HPBA.43

Table 3.2.20 presents the annual shipments of the residential direct heating

equipment industry from 2002 to 2006 as estimated by AHRI and HPBA.

3­27

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Table 3.2.20 AHRI and HPBA Residential Direct Heating Equipment Industry

Estimated Shipment Data (New Construction and Replacement)*44

Year

Vented

Wall

Furnace*

*

Direct Vent

Wall

Furnace**

Floor

Furnaces

Vented

Room

Heaters**

*, ††

Vented Gas

Hearth

DHE††,†††

2006 80,000 54,000 4,000 N/A 1,728,000

2005 81,000 65,000 4,000 18,000 2,141,000

2004 88,000 66,000 5,000 21,000 2,104,000

2003 85,000 66,000 5,000 23,000 1,810,000

2002 84,000 61,000 6,000 21,000 1,716,000

* Shipment totals are rounded to nearest 1,000 units.
 

** Not specific to only fan­type or gravity­type direct heating equipment.
 

*** Shipment data not available for all years.
 

† Includes certain fireplaces that are AHRI certified
 

†† Shipment data from HPBA.
 

†††Includes gas log sets, which are not a covered product.
 

3.2.6.6 Pool Heater Shipments

The pool heater industry does not report information about pool heater shipments

in as much detail as the water heater industry due to confidentiality concerns. However,

some information is available. DOE estimated shipments for pool heaters in the national

impacts analysis (NIA, chapter 10 of this TSD) and presents a sample of those shipments

in Table 3.2.21. Generally, shipments increase between 2003 and 2010 at an average rate

of approximately 13,000 units each year.

Table 3.2.21 Residential Gas­Fired Pool Heater Shipments*

Year Pool Heater Shipments

2010 357,000

2009 338,000

2008 322,000

2007 314,000

2006 309,000

2005 297,000

2004 280,000

2003 262,000

* Shipments rounded to nearest 1,000 units.

3.2.7 Industry Cost Structure

DOE developed the residential water heater, direct heating equipment, and pool

heater industry cost structures from publicly available information from the ASM, and

from Security Exchange Commission (SEC) 10­K reports filed by publicly owned

manufacturers. Companies subject to SEC regulations must report sales, costs of goods

sold, gross profits, and various overhead costs, in addition to overall performance and

operations for the year. DOE analyzed SEC reports and developed a representative cost

structure for the industries of each product type.

3­28

EE-2006-STD-0129 COMMENT 56.10
                             

                           

                               

                       

                   

                       

     

                       

                         

               

                     

             

     

         

   

                     

                           

                           

     

    

                   

                           

                       

                       

         

                                                

           

DOE examined SEC 10­K reports from 2000 to 2006. The cost of materials as a

percentage of revenue for each product can fluctuate as raw material costs change from

year to year. The cost of payroll for production workers as a percentage of revenue for

each product type has declined, pointing to the possibility of increased production

automation in the heating products industry. Finally, selling, general, and administrative

costs have declined as manufacturers cut costs by reducing the non­production, support,

and administrative employee base.

Table 3.2.22 presents the industry cost structure derived from the SEC 10­K

reports.p Each financial statement entry is presented as a percentage of total revenue.

Table 3.2.22 Industry Cost Structure Using SEC Data

Financial Statement Entry

Percent of Total Revenue for Each Product Type

Water Heaters Direct Heating Equipment Pool Heaters

Profit before Financing 6.0 9.2 7.2

Selling, General, and Administrative Expenses 14.0 12.5 16.0

Research and Development 2.1 2.0 2.5

Overhead 15.4 16.0 16.0

Labor 10.1 9.4 10.0

Material 52.4 50.9 48.3

Total 100.0 100.0 100.0

The manufacturer impact analysis (MIA) (chapter 12 of this TSD) presents a

detailed financial analysis of each of the three product types covered by this rulemaking.

This analysis identifies key financial inputs, such as the cost of capital, working capital,

depreciation, and capital expenditures.

3.2.8 Equipment Lifetime

DOE reviewed available literature and consulted with manufacturers to establish

typical equipment lifetimes. (See the life­cycle cost analysis, chapter 8 of this TSD, for

additional details and sources used to determine the typical equipment lifetimes.) DOE

combined these sources to develop average estimated lifetimes of the equipment covered

by this rulemaking (Table 3.2.23).

p For more information, please visit www.sec.gov.

3­29

EE-2006-STD-0129 COMMENT 56.10
3-30 

Table 3.2.23 Equipment Lifetimes 

Equipment Average Lifetime 

years 

Residential Water Heaters 

Gas Storage-Type Water Heater 13 

Oil-Fired Water Heater 13 

Electric Storage-Type Water Heater 13 

Gas Instantaneous Water Heater 20 

Direct Heating Equipment 

Traditional and Hearth Direct Heating Equipment 15 

Pool Heaters 

Gas Pool Heater 8 

Chapter 8 of the TSD provides more information about residential water heater, 

direct heating equipment, and pool heater lifetimes. 

3.2.9 Market Performance Data 

DOE combined information from the AHRI directory,45 the CEC,46 and the FTC 

with other publicly available data from manufacturers’ catalogs of residential water 

heaters, direct heating equipment, and pool heaters to develop an understanding of these 

industries and their markets. These databases contain information such as manufacturer 

name, model number, and efficiency. 

3.2.9.1 Residential Water Heaters 

Figure 3.2.7 through Figure 3.2.18 show the distribution of energy factors and 

capacities of gas storage, oil-fired storage, electric storage, and instantaneous gas water 

heaters in the AHRI directory. DOE created separate market performance plots for ultra 

low NOX gas storage water heaters because currently available ultra low NOX gas storage 

water heaters exhibit difference performance characteristics than gas storage water 

heaters with a standard burner, due primarily to reduced air flow. Ultra low NOX burners 

are required on water heaters in certain areas of the United States that restrict nitrous 

oxide emissions of certain consumer appliances. Consequently, in the engineering 

analysis, DOE analyzed two representative gas storage water heatersone with a 

standard burner and one with an ultra low NOX burner. (See chapter 5 of the NOPR TSD 

for more details.) 

Figure 3.2.7 shows the number of gas storage water heaters at each energy factor 

rating from 0.48 to 0.67. The figure contains data for all volumes of storage capacity. 

EE-2006-STD-0129 COMMENT 56.10
3-31 

18 

- 3 - -

50 

9 

57 57 56 

407 

520 

196 

248 

431 

106 

75 67 76 

9 

-

100 

200 

300 

400 

500 

600 

0.48

0.49

0.500.51

0.52

0.530.54

0.55

0.56

0.570.58

0.590.600.610.62

0.63

0.640.65

0.66

0.67

Count

Energy Factor

Count: 2386

Average Gas EF: 0.60

Federal Standard for 40 Gallon Models

(Representative Rated Capacity)

Figure 3.2.7 Distribution of Gas Storage-Type Water Heater Models by Energy 

Factor for All Storage Volumes, All Burner Types 

Gas-fired water heater energy factors are concentrated between 0.58 and 0.63 EF. 

The minimum standard level listed in Figure 3.2.7 represents the Federal standard for a 

40-gallon gas water heater, the representative volume for gas water heaters. Chapter 5 of 

the NOPR TSD discusses the analysis of the representative volume. 

Figure 3.2.8 shows the number of gas-fired storage water heaters at each rated 

storage volume. 

EE-2006-STD-0129 COMMENT 56.10
3-32 

Figure 3.2.8 Distribution of Gas-fired Storage Water Heater Models by Rated 

Storage Volume, All Burner Types 

Gas-fired storage water heaters are mainly concentrated at the 40 and 50 gallon 

storage volumes. Based on the “large” and “small” product class division used for TSL 5 

(i.e., water heaters above 55 gallons are classified as “large” and all others are classified 

as “small”), 11.5% of gas-fired storage water heater models would fall into the “large” 

category and 88.5% of gas-fired storage water heater models would be considered 

“small.” 

Figure 3.2.9 shows the distribution of efficiencies at various capacities for gasfired storage water heaters and how the Federal standard, defined by energy factor, 

relates to rated storage capacity based on the equation in Table 3.2.8. 

EE-2006-STD-0129 COMMENT 56.10
3-33 

0.45

0.50

0.55

0.60

0.65

0.70

20 30 40 50 60 70 80 90 100

Energy Factor

Rated Volume (Gallons)

Federal

Standard

Figure 3.2.9 Distribution of Gas-Fired Storage-Type Water Heater Models by 

Storage Capacity, All Burner Types 

 Gas-fired water heaters are mainly distributed between 30 and 75 gallons of 

storage capacity. Generally, energy factor decreases as storage capacity increases due to 

increased standby losses at higher gallon sizes. 

Figure 3.2.10 shows the number of ultra low NOX gas-fired storage water heaters 

at each energy factor rating, from the minimum rating on the market of 0.56 to the 

maximum available rating of 0.62. The figure contains data for the all volumes of storage 

capacity. 

EE-2006-STD-0129 COMMENT 56.10
3-34 

2

0

7

5

8

3

13

0

2

4

6

8

10

12

14

0.56 0.57 0.58 0.59 0.6 0.61 0.62

C

o

u

n

t

Energy Factor

Count: 38

Average EF: 0.60

Federal Standard Level 

for 40 Gallon Models

(Representative Rated 

Gallon Capacity)

Figure 3.2.10 Distribution of Ultra Low NOX Gas-Fired Storage-Type Water Heater 

Models by Energy Factor for All Storage Volumes 

Ultra low NOX gas-fired water heater energy factors are concentrated between 

0.58 and 0.62 EF. The minimum standard level listed in Figure 3.2.10 represents the 

Federal standard for a 40-gallon gas-fired water heater, the representative volume for gasfired water heaters. 

Figure 3.2.11 shows the distribution of efficiencies at various capacities for ultra 

low NOX gas-fired storage water heaters, and how the Federal standard, defined by 

energy factor, relates to rated storage capacity based on the equation in Table 3.2.8. 

EE-2006-STD-0129 COMMENT 56.10
3-35 

0.45

0.5

0.55

0.6

0.65

0.7

20 30 40 50 60 70 80 90 100

E

n

e

r

g

y

F

a

c

to

r

Rated Volume (Gallons)

Federal Standard

Figure 3.2.11 Distribution of Ultra Low NOX Gas-Fired Storage Water Heater 

Models by Storage Capacity 

Ultra low NOX gas-fired water heaters are mainly distributed between 30 and 60 

gallons of storage capacity. Generally, energy factor decreases as storage capacity 

increases. 

Figure 3.2.12 shows the distribution of electric storage water heater models by 

energy factor for all storage volumes. 

EE-2006-STD-0129 COMMENT 56.10
3-36 

7 

-

9 5 12 

23 

14 15 12 

75 

140 

245 243 

40 

55 

0

50

100

150

200

250

300

0.81 0.82 0.83 0.84 0.85 0.86 0.87 0.88 0.89 0.90 0.91 0.92 0.93 0.94 0.95

C

o

u

n

t

Energy Factor

Count: 895

Average EF: 0.92

Federal Standard for 50 Gallon Models

(Representative Rated Capacity)

Figure 3.2.12 Distribution of Electric Storage-Type Water Heater Models by Energy 

Factor for All Storage Volumes 

Electric water heater energy factors are concentrated between 0.90 and 0.93. The 

Federal standard level listed in Figure 3.2.12 represents the current Federal standard for a 

50-gallon electric water heater, the representative volume for electric water heaters. 

Chapter 5 of the TSD discusses the analysis of the representative volume. 

Figure 3.2.13 shows the distribution of electric storage water heaters at each 

storage volume. 

EE-2006-STD-0129 COMMENT 56.10
3-37 

Figure 3.2.13 Distribution of Electric Storage Water Heater Models by Rated 

Storage Volume 

Electric storage water heaters are concentrated primarily at the 40 and 50 gallon 

storage volumes. Based on the “large” and “small” product class division used for TSL 5 

in the NOPR (i.e., storage water heaters above 55 gallons are classified as “large” and all 

others are classified as “small”), 27.4% of electric storage water heater models would fall 

into the “large” category and 72.6% of electric storage water heater models would be 

considered “small.” 

Figure 3.2.14 shows another distribution of models and how the Federal standard, 

defined by energy factor, relates to rated storage capacity based on the equation in Table 

3.2.8. 

EE-2006-STD-0129 COMMENT 56.10
3-38 

0.70

0.90

1.10

1.30

1.50

1.70

1.90

2.10

2.30

2.50

0 20 40 60 80 100 120 140

Energy Factor

Rated Volume (Gallon)

Federal Standard

Figure 3.2.14 Distribution of Electric Storage-Type Water Heater Models by 

Storage Capacity 

Figure 3.2.14 shows an obvious trend of electric storage water heater efficiency 

decreasing as storage capacity increases. There is a wide variety of electric storage water 

heater volume capacities available to consumers, from 27 to 120 gallons. 

Figure 3.2.15 shows the distribution of oil-fired storage water heater models by energy 

factor and storage capacity for all storage volumes. 

EE-2006-STD-0129 COMMENT 56.10
3-39 

0 0 0

2

0 0

4

2

0 0 0 0

2

0

3

0 0 0

1

0

1

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

0

.

4

8

0

.

4

9

0

.

5

0

0

.

5

1

0

.

5

2

0

.

5

3

0

.

5

4

0

.

5

5

0

.

5

6

0

.

5

7

0

.

5

8

0

.

5

9

0

.

6

0

0

.

6

1

0

.

6

2

0

.

6

3

0

.

6

4

0

.

6

5

0

.

6

6

0

.

6

7

0

.

6

8

C

o

u

n

t

Energy Factor

Count: 15

Average Oil EF: 0.58

Federal Standard for 32 Gallon Models

(Representative Rated Capacity)

Figure 3.2.15 Distribution of Oil-Fired Storage-Type Water Heater Models by 

Energy Factor for All Storage Volumes 

Oil-fired water energy factors are more diffuse. The Federal standard level listed 

on Figure 3.2.15 represents the current Federal standard for a 32-gallon oil-fired water 

heater, the representative volume for oil-fired water heaters. Chapter 5 of the NOPR TSD 

discusses the analysis of the representative volume. 

Figure 3.2.16 shows another distribution of the oil-fired storage water heater 

models and how the Federal standard, defined by energy factor, relates to rated storage 

capacity based on the equation in Table 3.2.8. 

EE-2006-STD-0129 COMMENT 56.10
3-40 

0.45

0.50

0.55

0.60

0.65

0.70

30 32 34 36 38 40 42 44 46 48 50

Energy Factor

Rated Volume (Gallons)

Federal Standard

Figure 3.2.16 Distribution of Oil-Fired Storage-Type Water Heater Models by 

Storage Capacity 

Figure 3.2.16 shows that oil-fired storage water heaters are concentrated around 

30 to 32 gallons and 50 gallons of storage capacity. The energy factor decreases as 

volume increases. 

Figure 3.2.17 shows the distribution of energy factors of instantaneous gas-fired 

water heaters in the AHRI, CEC, and FTC directories.

EE-2006-STD-0129 COMMENT 56.10
3-41 

6 

4 

2 2 

4 4 

2 

5 4 

6 6 5 

20 

55 

1 

19 

17 

5 

9 

4 

2 

-

10 

20 

30 

40 

50 

60 

Count

Energy Factor

Count: 182

Average EF: 0.79

Federal Standard for 0 gallon models

(Representative Rated Capacity)

Figure 3.2.17 Distribution of Instantaneous Gas-Fired Water Heater Models by 

Energy Factor, All Input Capacity Ratings 

The instantaneous gas-fired water heater market is concentrated around units with 

energy factors ranging from 0.80 to 0.84. Figure 3.2.18 shows another distribution of 

instantaneous gas-fired water heaters and how energy factors relate to input capacity. The 

Federal standard line is based on the equation in Table 3.2.8 for existing Federal energy 

conservation standards. The line is horizontal because energy factor does not depend on 

input capacity and because the rated storage volume for all instantaneous water heaters is 

0 gallons. 

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3-42 

0.6

0.65

0.7

0.75

0.8

0.85

0.9

0.95

1

0 50 100 150 200 250

Energy Factor

Input (kBtu/h)

Count: 737

Average EF: 0.83

Federal Standard

Figure 3.2.18 Distribution of Instantaneous Gas-Fired Water Heater Models by 

Input Capacity 

3.2.9.2 Direct Heating Equipment 

Figure 3.2.19, Figure 3.2.20, Figure 3.2.21, Figure 3.2.22 and Figure 3.2.23 show 

the input rating and AFUE of wall furnace fan-type, wall furnace gravity-type, floor 

furnace, room heater, and hearth-type direct heating equipment, respectively. DOE 

obtained this information from the AHRI directory and other publicly available product 

literature. 

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72

74

76

78

80

82

84

0 10000 20000 30000 40000 50000 60000 70000

AFUE (percent)

Input Rating (Btu/hour)

Count: 82

Average AFUE: 77.3

Federal Standard

Figure 3.2.19 Distribution of Wall Furnace Fan-Type Models by Input Rating and 

AFUE 

Some fan-type wall furnaces just meet the Federal standard, while some exceed 

the Federal standard by more than 10 absolute percentage points. There is no 

concentration of efficiencies. When fan-type wall furnaces are analyzed by input rating, 

efficiency varies across the range of AFUEs. For low-efficiency products, efficiency 

increases with increased input rating. For high-efficiency products, efficiency decreases 

with increased input rating. 

EE-2006-STD-0129 COMMENT 56.10
3-44 

55

60

65

70

75

80

85

0 10000 20000 30000 40000 50000 60000

AFUE (percent)

Input Rating (Btu/hour)

Count: 54

Average AFUE: 66.6

Federal Standard

Figure 3.2.20 Distribution of Wall Furnace Gravity-Type Models by Input Rating 

and AFUE 

Some gravity-type wall furnaces just meet the Federal standard, while some 

exceed the Federal standard by more than 20 absolute percentage points. The majority of 

gravity-type wall furnaces have efficiencies below 70 percent AFUE. There is no 

discernible relationship between input rating and efficiency. 

EE-2006-STD-0129 COMMENT 56.10
3-45 

55.5

56

56.5

57

57.5

58

58.5

0 10000 20000 30000 40000 50000 60000 70000 80000

AFUE (percent)

Input Rating (Btu/hour)

Count: 15

Average AFUE: 57.5

Federal Standard

Figure 3.2.21 Distribution of Floor Furnace Models by Input Rating and AFUE 

Some floor furnaces just meet the Federal standard, while some exceed the 

Federal standard by only one absolute percentage point. Floor furnaces have efficiencies 

in a narrow range between 56 and 58 percent AFUE, with an increase in efficiency as 

input rating increases. 

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Figure 3.2.22 Distribution of Room Heater Models by Input Rating and AFUE 

Some room heaters just meet the Federal standard, while some exceed the Federal 

standard by approximately 25 absolute percentage points or more. Room furnaces have 

efficiencies in a range between 57 and 83 percent AFUE, with an increase in efficiency as 

input rating increases. The room heaters rated at 83 percent AFUE were identified by 

DOE through review of publicly available product literature. Although AHRI does not 

list this product in its directory, it is available to consumers. 

EE-2006-STD-0129 COMMENT 56.10
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55

60

65

70

75

80

85

90

95

0 10000 20000 30000 40000 50000 60000 70000 80000

A

F

U

E

(

p

e

r

c

e

n

t

)

Input Rating (Btu/hour)

Count: 296

Average AFUE: 67.4

Figure 3.2.23 Distribution of Hearth Models by Input Rating and AFUE 

Hearth models have efficiencies between 57 and 93 percent AFUE. AHRI does 

not list gas hearth DHE in its directory as a separate product type, but does include 

certain certified gas hearth DHE listed as various types of traditional direct heating 

equipment. DOE identified products currently in the AHRI database that would be 

classified as gas hearth DHE and separated them into their own product class. DOE found 

through a review of product literature that additional gas hearth DHE models are 

available to consumers. 

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3.2.9.3 Pool Heaters 

Figure 3.2.24 shows the distribution and thermal efficiency of gas-fired pool 

heaters in the CEC and FTC directories. 

75

80

85

90

95

100

0 200,000 400,000 600,000 800,000 1,000,000 1,200,000

Thermal Efficiency (percent)

Input Rating (Btu/hour)

Count: 409

Average Thermal

Efficiency: 82.7

Federal Standard

Figure 3.2.24 Distribution of Pool Heater Models by Input Capacity and Thermal 

Efficiency 

The majority of pool heaters are rated with an input capacity of 400,000 Btu/h or 

less. Of these pool heaters, all models exceed the Federal standard. The pool heaters rated 

at input capacities above 400,000 Btu/h are typically not marketed for residential use. 

3.3 TECHNOLOGY ASSESSMENT 

The purpose of the technology assessment is to develop a list of technology 

options manufacturers can use to improve the efficiency of residential water heaters, 

direct heating equipment, and pool heaters. The following assessment provides 

descriptions of those technology options that apply to all product classes. 

In preparation for the screening and engineering analyses, DOE identified several 

possible technology options and examined the most common efficiency-improving 

technologies used today. These technology options provide insight into the technological 

improvements typically used to increase the energy efficiency of residential water 

heaters, direct heating equipment, and pool heaters. 

EE-2006-STD-0129 COMMENT 56.10
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3.3.1 Baseline Equipment Components and Operation 

The baseline model for each product class serves as a reference point for 

measuring changes resulting from energy conservation standards. DOE defines the 

baseline model in each product class as a product having an efficiency that just meets the 

existing Federal energy conservation standards. DOE also defines baseline models as 

having commonly available features. 

3.3.1.1 Baseline Residential Water Heaters 

Gas-Fired Storage Water Heaters. The baseline gas-fired storage water heater is 

a water heater that incorporates a complete gas-fired water heating system in an 

individual package. Each baseline gas-fired water heater consists of a glass-lined 

corrosion-resistant steel tank, insulation surrounding the top and sides of the tank, a dip 

tube that directs cold entering water to the bottom of the tank, a hot water outlet pipe, 

heat traps, a gas burner, a standing pilot ignition, a combustion chamber, a burner control 

thermostat, a gas valve, a sacrificial anode, a flue within the water tank, a baffle-type heat 

exchanger within the flue, a temperature and pressure-relief valve, an outer case, and 

packaging for shipment. Manufacturers may differentiate gas-fired water heaters by 

efficiency rating, input to burners, and storage capacity.

Oil-Fired Storage Water Heaters. The baseline oil-fired storage water heater is a 

water heater that incorporates a complete oil-fired water heating system in an individual 

package. Each baseline oil-fired water heater consists of a glass-lined corrosion-resistant 

steel tank, insulation surrounding the top and sides of the tank, a dip tube that directs cold 

entering water to the bottom of the tank, a hot water outlet pipe, a combustion chamber, a 

sacrificial anode, a flue within the water tank, a baffle-type heat exchanger within the 

flue, an oil-fired power burner system, a burner control thermostat, a temperature and 

pressure-relief valve, an outer case, and packaging for shipment. Manufacturers may 

differentiate oil-fired water heaters by efficiency rating, input to burners, and storage 

capacity.

Electric Storage Water Heater. The baseline electric storage water heater is a 

water heater that incorporates a complete electric powered water heating system in an 

individual package. Each baseline electric water heater consists of a glass-lined 

corrosion-resistant steel tank, insulation surrounding the top and sides of the tank, a dip 

tube that directs cold entering water to the bottom of the tank, a hot water outlet pipe, 

heat traps, electric resistive heating elements, a control thermostat and wire harness, a 

sacrificial anode, a temperature and pressure-relief valve, an outer case, and packaging 

for shipment. Manufacturers may differentiate electric water heaters by efficiency rating, 

input to the heating elements, and storage capacity.

Instantaneous Gas-Fired Water Heaters. The baseline instantaneous gas-fired 

water heater is a water heater that incorporates a complete instantaneous gas-fired water 

heating system in an individual package. Each baseline instantaneous gas-fired water 

heater consists of a cold water inlet, a hot water outlet, a combustion chamber, a heat 

exchanger, a burner, a vent, a standing pilot ignition, a flow detection device, a gas valve, 

EE-2006-STD-0129 COMMENT 56.10
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a burner control thermostat, an outer case, and packaging for shipment. Manufacturers 

may differentiate instantaneous gas-fired water heaters by efficiency rating and input to 

the burners. 

3.3.1.2 Baseline Direct Heating Equipment 

Gas Wall Fan Type. The gas wall fan-type heater is a heater that incorporates a 

complete gas heating system in an individual package. Each baseline gas wall fan-type 

heater consists of a heat exchanger, a room air circulation blower, a standing pilot 

ignition system, a burner, a pilot light sensing control valve, a combustion chamber, a 

flue, an intake, a burner control thermostat, an outer case, and packaging for shipment. 

Manufacturers may differentiate gas wall fan-type heaters by efficiency rating and input 

rating.

Gas Wall Gravity Type. The gas wall gravity-type heater is a heater that 

incorporates a complete gas heating system in an individual package. Each baseline gas 

wall gravity-type heater consists of a heat exchanger, a standing pilot ignition system, a 

burner, a pilot light sensing control valve, a combustion chamber, a flue, an intake, a 

burner control thermostat, an outer case, and packaging for shipment. Manufacturers may 

differentiate gas wall gravity-type heaters by efficiency rating and input rating.

Gas Floor Type. The gas floor-type heater is a heater that incorporates a complete 

gas heating system in an individual package. Each baseline gas floor-type heater consists 

of a heat exchanger, a standing pilot ignition system, a burner, a pilot light sensing 

control valve, a combustion chamber, a flue, an intake, a burner control thermostat, a 

floor grate, an outer case, and packaging for shipment. Manufacturers may differentiate 

gas floor-type heaters by efficiency rating and input rating.

Gas Room. The gas room-type heater is a heater that incorporates a complete gas 

heating system in an individual package. Each baseline gas room-type heater consists of a 

heat exchanger, a standing pilot ignition system, a burner, a pilot light sensing control 

valve, a combustion chamber, a flue, an intake, a burner control thermostat, an outer case, 

and packaging for shipment. Manufacturers may differentiate gas room-type heaters by 

efficiency rating and input rating. Manufacturers may also differentiate by outer case. 

Room heaters can be packaged as console and hearth-type heaters.

Gas Hearth. A gas hearth heater simulates a wood-burning device. Each baseline 

vented gas hearth product consists of a heat exchanger, a standing pilot ignition system, a 

burner, a pilot light sensing control valve, a combustion chamber, a flue, an intake, a 

burner control thermostat, ceramic logs, an outer case, and a tempered glass viewing 

pane. Manufacturers may differentiate vented gas hearth DHE by efficiency rating and 

input rating.

3.3.1.3 Baseline Pool Heaters 

A gas-fired pool heater incorporates a complete pool heating system in an 

individual package. Each baseline gas pool heater consists of a cold water inlet pipe, a 

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hot water outlet pipe, a heat exchanger, a standing pilot ignition system, a burner, a pilot 

light sensing control valve, a combustion chamber, a flue/vent, an air intake, a burner 

control thermostat, an outer case, and packaging for shipment. Manufacturers may 

differentiate gas-fired pool heaters by efficiency rating or input rating.

3.3.2 Technology Options 

3.3.2.1 Water Heaters 

DOE identified the following technology options as having the potential to 

improve the efficiency of water heaters: 

1. Heat traps 

2. Insulation improvements 

3. Power vent (gas-fired and oil-fired only) 

4. Heat exchanger improvements 

5. Flue damper (electromechanical) 

6. Side arm heater 

7. Electronic (or interrupted) ignition 

8. Heat pump water heater (electric only) 

9. CO2 heat pump water heater 

10. Flue damper (buoyancy operated) 

11. Directly fired 

12. Condensing 

13. Condensing pulse combustion 

14. Thermophotovoltaic and thermoelectric generators 

15. Reduced burner size (slow recovery) 

16. Timer control 

17. Two-phase thermosiphon (TPTS) 

18. Modulating controls 

19. Intelligent controls 

20. Self-cleaning. 

Heat Traps (Oil Fired). Residential water heaters lose heat by conduction and 

convection through the fittings (water pipes, drain valve, pressure relief valve, and 

thermostat), which contributes to standby losses. A heat trap is a device or arrangement 

of piping that keeps the buoyant hot water from circulating to the piping distribution 

system by natural convection, which leads to heat loss through uninsulated pipes to the 

surroundings. When there is no draw of hot water, a heat trap prevents water in the hot 

water outlet line from getting back into the tank as it cools off, and prevents hot water in 

the tank from circulating back into the cold water inlet line. Thus, by containing hot 

water in storage tanks, heat traps minimize standby loss. These devices can be integral to 

tank design or independently attached to inlet and outlet pipes during installation at the 

site. Insulating its exposed portion can increase the effectiveness of a heat trap. Multiple 

manufacturers include heat traps on their water heater models. 

EE-2006-STD-0129 COMMENT 56.10
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Conventional heat traps come in two styles. In the first style, a floating plastic ball 

blocks the cold water inlet. The buoyancy of the plastic holds it in place until water is 

drawn. The force of water is strong enough to push the ball out of the way as water enters 

the tank. 

The second style is used for the hot water outlet. In this heat trap, the ball is 

denser than water, and the weight of the ball seals the outlet until hot water is drawn and 

the water pressure lifts it out of the way. A small bypass channel is left for water to 

escape back into the inlet line from the tank after a large draw fills the tank with cold 

water. Heat traps can also be made of metal. Manufacturing costs appear to be roughly 

comparable between metal and plastic heat traps, but plastic heat traps are considerably 

more effective in reducing water heater standby losses. 

Other heat trap designs include U-shaped pipes, flexible seals, flaps, and springs. 

Insulation Improvements (Gas-Fired, Oil-Fired, Electric Storage). Standby 

losses can be reduced by improving water heater tank insulation. Increasing the thermal 

resistivity of the water heater jacket to reduce the amount of heat loss during standby 

periods increases the water heater energy factor. 

Insulation can be improved by modifying the baseline design of the standard gasfired storage water heater using (1) increased jacket insulation, (2) a plastic tank, (3) an 

insulated tank bottom (electric only), (4) advanced forms of insulation, and (5) foam 

insulation. 

Increased Jacket Insulation. Manufacturers insulate gas-fired, electric, and oilfired storage water heaters by filling the cavity between the jacket and the tank (top and 

sides) with insulation. Most storage water heaters on the market today have at least 1-

inch thick insulation; some models have 2- or 3-inch thick insulation. Increasing the 

diameter of the jacket insulation will reduce standby losses by increasing the thermal 

resistivity of the water heater jacket. Jacket losses represent a majority of the standby 

losses. Some manufacturers produce water heaters with increased insulation. Aftermarket insulating blankets are also commercially available to increase water heater 

insulation. 

Plastic Tank (electric only). Plastic water heater storage tanks can be constructed 

using a seamless, blow-molded polybutylene inner tank with a filament-wound fiberglass 

outer tank. A second method involves constructing a thin steel shell with an internal 

plastic tank. The steel exterior is constructed first, then plastic powder is injected into the 

shell and the tank is rotated in a furnace to coat the interior with the plastic. The steel 

exterior serves as the primary structural support for the tank. The lower heat conductivity 

of plastic compared to metal reduces the amount of heat conducted through the tank wall 

to the insulation and to the feed-throughs. However, the plastic tank cannot be used with 

standard center-flue gas-fired storage water heaters or with oil-fired storage water heaters 

because the plastic cannot withstand the high temperatures produced by the flames. 

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Insulated Tank Bottom (electric only). Insulated tank bottoms increase water 

heater efficiency by reducing standby losses. The standard water heater tank is not 

insulated on the bottom, where water temperature is lowest. However, the tank bottom is 

still conductive; therefore, adding insulation will reduce heat dissipation through the 

bottom of the tank. 

Advanced Forms of Insulation. Alternate ways of reducing the jacket losses 

without increasing the diameter of gas-fired, electric, and oil-fired storage water heaters 

include using advanced insulation materials or evacuated panels. Some of the advanced 

materials or methods of insulation considered here involve using vacuum insulation, inert 

gases, aerogel insulation, or partial vacuums. 

Vacuum Insulation. A “hard” vacuum between internal reflective surfaces 

is a very good insulator. It has been used for years in Thermos bottles and Dewar 

tanks for cryogenic applications. Durability and the difficulty of maintaining the 

seal over the life of the storage water heater are some manufacturing problems 

that have to be resolved. 

Gas-Filled Panels. Gas-filled panels are thermal insulating devices that 

retain a high concentration of a low-conductivity gas at atmospheric pressure 

within a multilayer infrared reflective baffle. The thermal performance of the 

panels depends on the type of gas fill and the baffle configuration. Gas-filled 

panels are flexible and self-supporting, and can be made in a variety of shapes and 

sizes to thoroughly fill most types of cavities. This technology has not been 

demonstrated for water heater applications.47

Aerogel Insulation. An example of advanced insulation materials is silica 

aerogel, which is composed of 96 percent air and 4 percent silicon dioxide. 

Aerogels are more efficient and weigh less than the polyurethane foam currently 

used in most water heaters. The R-value of the aerogel at atmospheric pressure is 

comparable to that of the polyurethane foam, but when 90 percent of the air is 

evacuated from a plastic-sealed aerogel packet, its resistance nearly triples. 

Another advantage of aerogel insulation over foam insulation is avoiding the use 

of chlorofluorocarbons to blow the polyurethane foam into the heater jacket. New 

manufacturing processes have been developed that can produce flexible blankets 

or clamshell forms of this material. The aerogel material is vulnerable to shock 

and vibration, however, and material handling is an issue. Because the aerogel is 

hygroscopic, it requires a thorough sealing of the cavity between the water heater 

tank and the outside cover. The material has not been demonstrated for use with 

water heaters. 

Evacuated Panels. Other materials with a lightweight open structure can 

provide effective insulation combined with “soft” or low vacuums. The materials 

can be enclosed with metals or plastic. A vacuum is drawn in this panel before 

sealing, and a lightweight, rigid foam keeps the vacuum from compressing the 

panel. This technology has not been demonstrated for storage water heater 

applications. 

EE-2006-STD-0129 COMMENT 56.10
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Foam Insulation. Foam insulation can be used as an alternative to fiberglass 

insulation. Chlorofluorocarbon-free, water-blown polyurethane foam is a common 

alternative to high-density fiberglass blankets. Incorporating foam insulation of the same 

thickness in place of fiberglass insulation can increase overall efficiency of the storagetype water heater. Foam typically has an R-value up to two to three times greater than 

fiberglass. Additionally, foam can be blown into the cavity between the tank and the 

outer case and does not need to be cut to form as required by some fiberglass installation 

methods. This facilitates the filling of small spaces and constrictive geometries where the 

potential for heat loss still exists, and which would be difficult to fill with fiberglass batts. 

Finally, manufacturing processes that use foam-blowing techniques are better suited for 

production line changes due to the shape-conforming characteristics of the foam. This 

allows additional technology options, methods, and advances to be incorporated into 

current designs with minimal impacts on insulation installation techniques. 

Power Vent (Gas-Fired and Oil-Fired Storage). The power vent technology 

option can increase the recovery efficiency, depending on the specific set-up of the 

technology. Power vents can be designed as either induced or forced draft systems. An 

induced draft fan is installed downstream of the draft diverter in the venting system and 

pulls flue gases through the flue. A forced draft fan is upstream of the combustion 

chamber and supplies the correct fuel-to-air ratio for combustion. Both methods improve 

efficiency by increasing turbulence in the flue gases. 

Typically, this technology is incorporated with a flue baffle that has a more 

restricted flow path. Induced and forced draft fans can transmit air through the restricted 

flue baffle, where a natural venting system would not be possible. This restriction of air 

flow increases mixing, which increases heat transfer, thermal efficiency, and recovery 

efficiency. When recovery efficiencies reach above 80 percent, condensation of flue 

gases is likely. Water heaters obtaining recovery efficiencies above 80 percent should 

include methods to properly dispose of condensate and be made of materials that resist 

corrosion caused by condensate. 

In addition to an increase in efficiency, there is also a reduction in standby loss. 

The restrictions created by the stationary blower installed in either the intake or flue paths 

reduce the off-cycle standby loss. The blowers act like dampers. 

Some manufacturers make water heaters with induced draft fans that, in addition 

to pulling the combustion products through the water heater, also draw excess air into the 

flue gases before venting. This is similar to a vent hood used in natural venting 

applications. Adding ambient air cools flue gases leaving the water heater to a low 

enough temperature so that standard plastic piping can be used for venting. This 

eliminates any problems with metal vent pipe corrosion. Plastic piping is often cheaper 

and easier to install than sheet metal or masonry chimneys. 

Heat Exchanger Improvements (Gas-Fired, Oil-Fired Storage, and 

Instantaneous). Heat transfer from the flue gases to the water can be enhanced by 

improving the flue baffle or heat exchanger. The improved heat transfer leads to an 

increase in the thermal efficiency of the water heater. If the thermal efficiency is 

EE-2006-STD-0129 COMMENT 56.10
3-55 

increased to about 84 percent, condensation of the flue gases begins to occur in the flue 

or vent pipe. Condensation may cause the surfaces of the flue and vent pipe to corrode. 

To avoid such problems, materials that resist corrosion and methods to properly collect 

and dispose of condensate are incorporated into water heater designs. 

The heat exchanger can be improved by modifying the baseline gas-fired storage 

water heater using (1) increased heat exchanger surface area, (2) an improved flue baffle, 

(3) a submerged combustion chamber, (4) multiple flues, (5) alternative flue geometry 

(helical), or (6) a u-tube flue. These approaches can increase recovery efficiency 

significantly, but may also cause condensation (and hence corrosion) to occur in venting 

systems. 

Increased Heat Exchanger Surface Area. The baseline design consists of a 

vertical flue in the center of the gas-fired or oil-fired storage water heater tank. This 

design can be improved by increasing the surface area of the flue, which increases the 

amount of heat transfer and thermal efficiency. One way to accomplish this is by 

increasing the diameter of the flue. The overall tank diameter would need to be increased 

to maintain consistent volume. Tank height could also be increased to maintain the same 

volume, which would also add surface area to the flue. The flue baffle would most likely 

require modification in order to maintain the same amount of air flow restriction. 

Enhanced Flue Baffle. The standard flue baffle of a gas-fired and oil-fired storage 

water heater is a twisted strip of metal inserted into the flue that increases the turbulence 

of flue gases and improves heat transfer to the walls of the flue. The geometry of the flue 

baffle can be modified to increase its effectiveness. Improving the flue baffle so that air 

flow becomes more restricted and more turbulent can increase the amount of heat 

transfer, which increases the thermal efficiency. Increasing the length of the path that the 

flue gases travel and including more turns in the flue gas path can improve the flue 

baffling. This can be accomplished by including fins or some other form of extrusion 

from the flue wall, or by increasing the number of flow altering features in the baffle, 

which is typically constructed from a flat piece of sheet metal and inserted into the flue. 

These methods to enhance the flue baffle, which increase air flow restriction and 

turbulence, may also result in an increased surface area, which also increases heat 

transfer. Enhanced flue baffle technology can also reduce standby losses. Enhancements 

to the flue baffle typically create restrictions to the air flow, which decreases convective 

heat loss during standby periods. 

Submerged Combustion Chamber. The combustion chamber in a standard gasfired and oil-fired storage water heater is below the water tank, and the bottom of the tank 

(below the burners) is seldom insulated. Therefore, the water heater loses heat from 

below the tank. The sides and bottom of the combustion chamber are not surrounded by 

water. By inserting the combustion chamber into the storage tank, more of the 

combustion energy can be recovered. Standby losses are reduced somewhat because of 

restrictions on air flow through the combustion chamber and flue. 

Multiple Flues. The multiple flue design uses several smaller flues in place of one 

large central flue in the middle of the storage tank. The increased surface area for heat 

EE-2006-STD-0129 COMMENT 56.10
3-56 

exchange between the flue gases and the water in the tank yields an increase in recovery 

efficiency. 

Alternative Flue Geometry (Helical). This technology option is most often 

associated with condensing gas-fired storage water heaters, but it also applies to oil-fired 

storage water heaters. The technology incorporates both a helical or spiraling flue and a 

u-tube flue. This technology contributes to increased efficiency in two distinct ways. The 

surface area of the flue is increased, since it runs a helical path considerably longer than 

the height of the water tank, increasing heat transfer during steady-state operations. Also, 

when the burner is not operating, the multiple turns in the flue resist heat convection out 

of the flue, reducing standby losses. Directing the flue downward with a “U” shape 

allows the forming condensate to drain from the water heater flue properly. The flue 

usually exits the sidewall of the water heater. Safety concerns exist due to the corrosive 

and acidic nature of the flue gas condensate; corrosion-resistant materials are used to 

mitigate this damage. 

U-Tube. A u-tube flue for a gas-fired or oil-fired storage water heater is a flue 

shaped like an inverted “U” within the water heater tank. This shape contributes to 

increased efficiency in two distinct ways. The surface area of the flue is increased, as it 

runs twice the height of the water tank, increasing heat transfer during steady-state 

operation. This effect is similar to the increased heat exchanger surface area technology 

option. When the burner is not operating, the inverted u-shaped flue resists heat 

convection out of the flue, reducing standby losses. This effect is similar to the flue 

damper technology options. 

Direct Vent. Another method to increase surface area includes a secondary heat 

exchanger. Combustion gases exiting through the vent preheat incoming air before it 

passes through the primary heat exchanger. Manufacturers currently produce 

instantaneous water heaters that accomplish this by running the inlet and exhaust vents 

concentrically. This venting configuration is known as direct-vent. This set-up is similar 

to a shell-in-tube heat exchanger. 

Manufacturers currently produce water heaters with heat exchanger improvement 

technologies. 

Electromechanical Flue Damper (Gas-Fired Storage). Gas-fired storage water 

heaters are typically equipped with a draft hood connecting the flue pipes to a vent pipe 

or chimney. During off-cycle, the water heater loses heat by natural convection and 

conduction through the vent pipe or chimney. Installing a damper at the flue exit or in the 

vent pipe can minimize the off-cycle heat losses. A flue damper is installed upstream of 

the draft diverter, while the vent damper is installed downstream of the draft diverter. 

Electric flue dampers are activated by an external source of electricity. The 

dampers open when combustion starts and close immediately after combustion stops. 

Therefore, there is a greater reduction in off-cycle losses compared to buoyancy-activated 

dampers. When the damper reaches the open position, an interlock switch energizes the 

solenoid and enables the gas ignition circuit. Therefore, the burner cannot be ignited 

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when the damper is in the closed position. Because the dampers open and close 

immediately, no bypass is needed. However, a knockout vents the flue gases from a 

standing pilot. The electric flue damper needs an electric hookup and consumes power 

when the gas supply is off. 

Flue and vent dampers have no effect on the steady-state performance of the 

water heater. However, flue and vent dampers can reduce standby losses of gas-fired 

storage water heaters, yielding improved energy efficiency. Some commercial water 

heaters use flue dampers. 

Side Arm Heater (Gas-Fired, Oil-Fired Storage). The side arm heater technology 

option for gas-fired and oil-fired storage water heaters avoids large flue losses by 

removing the flue from the center of the storage tank. Water is withdrawn from the 

bottom of the tank, heated over a burner in a small, separate heat exchanger, and returned 

to the top of the tank. A small circulation pump moves water through the heat exchanger 

when the burner is on. The burner could have electronic ignition, which would reduce 

pilot light losses. A low-voltage transformer, fed by a standard 120-volt wall connection, 

supplies auxiliary power. Water heaters using this design are not currently on the market. 

Electronic (or Interrupted) Ignition (Gas-Fired, Oil-Fired Storage, and 

Instantaneous). The most commonly used ignition system in gas-fired and oil-fired 

storage water heaters and instantaneous water heaters is a standing pilot ignition system. 

The disadvantage of these water heaters is that they burn gas continuously at a rate of 

about 1000 Btu/hr, and only part of this heat is converted to useful energy. As an 

alternative to standing pilots, three electronic ignition devices are sometimes used in gasfired and oil-fired storage water heater and instantaneous water heater products: 

Intermittent Pilot Ignition. This is a device that lights a pilot by generating a 

spark, which in turn lights the main burner. 

Intermittent Direct Ignition. This system lights the main burner directly by 

generating a spark. 

Hot Surface Ignition. This system lights the main burner directly via a sufficiently 

hot surface. 

Hydroelectric ignition is another form of electronic ignition used in gas-fired 

products, particularly instantaneous water heaters. However, it is not as common as the 

three forms of ignitions above. For hydroelectric systems, a small turbine is spun by 

flowing water to produce electricity, which ignites a pilot. This is similar to intermittent 

pilot ignition. 

Unlike standing pilot ignition systems that consume gas continuously, 

hydroelectric devices operate only at the beginning of each on-period. Although there is 

no increase in the steady-state efficiency with the use of electronic ignition devices, they 

reduce overall fuel consumption. Burner on-time may increase, however, to make up for 

the heat the standing pilot would have supplied during standby periods. 

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The “interrupted ignition” system for an oil-fired burner activates the spark only 

until a steady flame is established. This differs from “intermittent ignition” for oil-fired 

burners, where the energy source is activated during the entire burner operating cycle. 

Interrupted ignition does not affect oil consumption, and there is no improvement in the 

recovery efficiency of the water heater. However, this technology option not only reduces 

the igniter’s electricity consumption, but also reduces its maintenance costs because the 

electrodes do not have to be replaced as often. In addition to changes in controls, the 

igniter can be made from solid-state electronics, instead of an iron core transformer. This 

improves performance and also reduces power consumption. Manufacturers produce 

water heaters with electronic ignition. 

Heat Pump Water Heater (Electric Storage). A heat pump water heater 

represents a merging of two otherwise unrelated technologies: an electric resistance 

storage water heater with tank and controls, and a refrigeration circuit similar to that 

found in a residential air-conditioner. Heat pump water heaters use existing heat pump 

technology to extract heat from the surroundings for heating stored water. For electric 

water heaters, this is an alternative to resistive heating. Heat pump water heaters transfer 

heat from air, typically at room temperature, to water at a higher temperature. The heated 

water can then be used to provide the residential hot water supply. Since heat does not 

naturally transfer from a low temperature to a higher temperature, a mechanical system 

consisting primarily of a closed refrigeration loop containing a refrigerant vapor 

compressor, an evaporator (a type of heat exchanger), a condenser (another heat 

exchanger), and an expansion device is used to transfer the heat. The working fluid in the 

loop, the refrigerant, extracts heat from the surrounding air. Typically, the evaporator 

captures heat from the ambient air, and the condenser delivers this heat to the water 

inside of a storage tank. The pump and expansion device facilitate pressure and phase 

changes to allow for these heat transfer processes. 

When used continuously, typical heat pumps appear to heat water at roughly two 

and a half to three times the rate of energy input (in the form of electricity). In practice, 

actual tested residential heat pump water heater designs typically yield energy factors 

from approximately 1.0 to 3.0,48 while a baseline electric storage water heater has an 

energy factor of 0.90. An energy factor range exists because of variations in design and 

ambient conditions. For example, differences in piping between the heat pump and 

storage tank, efficiencies of the individual components of the heat pump loop, and 

storage tank characteristics affect EF. 

It should be noted that most U.S. homes are heated for substantial portions of the 

year, and operating a heat pump water heater typically extracts heat from the household 

air and increases the load on the home heating system during these periods. Energy 

factors for heat pump water heaters, or any water heaters, do not consider home heating 

loads. For this reason, accounting for the net energy or energy cost impact of the heat 

pump water heater requires analyzing the energy cost impact on the entire house, not just 

the electrical energy input to the water heater. 

There are two basic designs for residential heat pump water heaters: add-on and 

integral. An add-on heat pump water heater is designed to be added to a separately 

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manufactured storage tank, often a standard electric resistance water heater. A small 

pump circulates water from the tank through the heat pump. The heat pump and storage 

tank are combined in the field during installation. The second type of heat pump water 

heater is an integral heat pump water heater. In an integral design, the heat exchanger 

(condenser) is combined with the storage tank design during the manufacturing process. 

This eliminates the need for a circulation pump and increases efficiency. Both heat pump 

configurations typically supplement resistive, or traditional electric, storage water heaters 

where the elements operate only when the demand for hot water is greater than what the 

heat pump can supply. 

Both designs have a refrigeration subsystem composed of at least an expansion 

device, evaporator, compressor, and a fan (to force air over the evaporator and enhance 

heat transfer). The refrigerant condenser, also part of the refrigeration loop, can be 

located with the rest of the subsystem as a separate unit (as is done with the add-on-type 

heat pump water heater), or be integral to the tank as with the integral heat pump water 

heater design. In the add-on heat pump water heater, cold water is removed from the tank, 

heated, and pumped back into the tank. In the integral design, the heat pump compressor 

moves refrigerant from the condenser coil to the evaporator coil. The condenser coil is 

typically either inside the tank or wrapped around the tanks exterior (i.e., between the 

tank wall and the insulation). The evaporator coil is typically housed on top of the tank 

along with the remaining heat pump components. The compressor, evaporator coil, and 

evaporator fan mounted on top of the storage tank will add approximately 12 inches to 

the height of a traditional electric water heater tank. Regardless of design, the expansion 

device, evaporator, fan, and compressor must be located outside the tank. In the add-on 

design, components can be mounted on top of the tank or as a completely separate unit 

that can be placed on the floor or mounted on the wall. For higher efficiencies, the add-on 

heat pump water heater should be placed relatively close to the tank. As the unit is placed 

farther from the tank, the water heating efficiency degrades due to piping losses, 

predominantly the result of warm water left in the piping between on-cycles that results 

in heat transfer to the surroundings. 

The heat pump water heater also produces condensate at the evaporator coil 

during operation. Like all refrigeration devices, the evaporator coil must be cold to 

extract heat from the surrounding air. When air blows across the coil, moisture in the air 

is condensed to liquid. The amount of liquid produced is a function of the humidity in the 

air blown across the coil, the temperature of the evaporator coil, and the hot water load. 

Locating the heat pump in the conditioned space of a residence does not eliminate all the 

condensate buildup unless the air conditioning system can be counted on to dehumidify 

all house air to a dew point below the coil temperature. Therefore, condensate drains are 

typically required to remove condensation that collects as a result of operation. A pump 

may also be needed to move condensate to a drain. 

Most residential heat pump water heater designs need back-up electric resistance 

heating elements because cost and space considerations limit the heating capacity of the 

refrigeration system. Typical heat pump water heaters have between 40 and 80 percent of 

the heating capacity of typical electric resistance storage water heaters. To compensate 

for this reduced heating capacity and allow faster water heating and shorter recovery 

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periods for the heat pump water heater during periods of high use, electric resistance 

heaters are employed that can heat the water in the tank faster than the heat pump unit. 

The cost of larger capacity systems generally outweighs the energy efficiency benefits to 

the average consumer. Additionally, removing large amounts of heat from a conditioned 

space during high use periods with a larger system may create unfavorable conditions in a 

residence. Instead, practical systems are designed to heat water gradually using the higher 

efficiency heat pump, but can, when required by the heating load, use a higher capacity 

electric resistance backup. 

Finally, the space in which the heat pump water heater is located must be large to 

provide adequate air flow and must provide ready access for regular air filter changes on 

the heat pump evaporator coil. The refrigeration subsystem of a heat pump water heater 

needs sufficient flow of warm air across the evaporator coils to serve as a heat source. 

Without this heat source, the heat pump cannot function and must revert to electric 

resistance operation. Operation in heat pump mode will generally require about 100 cubic 

feet per minute or more of warm air. Multiple manufacturers produce heat pump water 

heaters. Multiple manufacturers produce heat pump water heaters, conduct heat pump 

research, and develop prototype designs. 

Carbon Dioxide (CO2) Heat Pump Water Heater (Electric Storage). CO2 heat 

pump water heaters are similar to the aforementioned heat pump water heater technology. 

This technology uses carbon dioxide as a natural refrigerant to transfer heat from the 

surrounding air to the water stored in the tank through a heat pump loop. Current 

products and prototypes can achieve coefficients of performance as high as 3.0,49 which 

result in EFs ranging from approximately 1.0 to 3.0. This range accounts for differences 

in ambient air conditions, storage tank efficiency, and efficiencies of the components that 

make up the heat pump loop. Additionally, some products installed outdoors can function 

in cold weather without freezing pipes or frosting evaporators. Typically, this technology 

is installed outdoors due to the size of components. Typical installations include a 

separately packaged heat pump and a separately packaged storage unit consisting of two 

tanks and supporting hardware. CO2 heat pump water heaters also take advantage of load 

shifting strategies by heating water at night and storing it for use during the day. Products 

are predominantly available outside of U.S. markets where products have been made 

available by government subsidy rebate programs.50 

Buoyancy Operated Flue Damper (Gas-Fired Storage). This flue damper is a 

small, very lightweight aluminum dome-shaped poppet that slides up and down in an 

enclosure placed at the top of the flue of a gas-fired water heater. The buoyancy of the 

combustion products lifts the poppet, allowing flue gases to enter the venting system. 

This technology option would reduce off-cycle standby losses by sealing the flue 

and preventing convection to the venting system, but would have no effect on recovery 

efficiency because it does not affect the rate of heat transfer. This flue damper may not 

work with high recovery efficiency water heaters because there may not be enough waste 

heat in the combustion products to provide sufficient buoyancy to lift the poppet. 

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The safety standard51 for gas water heaters requires the burner to shut off if the 

flue gets blocked for some reason. Thus, the effects of a failure of the flue damper to 

open should be mitigated by the burner controls. 

Directly Fired (Gas-Fired, Oil-Fired Storage). In this technology option, water is 

sprayed through a series of baffles above the burner of gas-fired and oil-fired storage 

water heaters. Burner flame and flue products are in direct contact with the water, which 

is re-pressurized by a circulating pump and returned to the storage tank. The direct 

contact process allows for more efficient heat transfer than conventional shell-and-tube 

gas-fired and oil-fired storage water heaters because the heat resistive barrier between the 

water and the flue products is eliminated. However, direct contact with flue products can 

lead to contamination of the domestic water. This can potentially cause health and safety 

problems for end users. This technology option can also cause conflict with local and 

uniform plumbing codes (e.g., International Association of Plumbing and Mechanical 

Officials (IAPMO) 1991) with respect to water quality.

Condensing (Gas-Fired, Oil-Fired Storage, and Instantaneous). Energy 

efficiency of gas-fired and oil-fired storage and instantaneous water heaters can be 

increased by extracting more heat from the flue gases. More energy can be extracted by 

condensing the combustion products in the flue gas, which extracts more heat in the form 

of latent energy, leading to an increase in the thermal efficiency of the gas-fired and oilfired storage and instantaneous water heater. Water heater technology options or a 

combination of technology options can be added to a water heater design to condense the 

combustion gases. 

The flue-gas condensate is often acidic and corrosive. Therefore, special 

corrosion-resistant heat exchangers and vent linings are required for safe and reliable 

operation of the water heater. Corrosion due to condensation of combustion gases limits 

the thermal efficiency of a fuel-fired water heater with a standard flue and vent system. 

Using corrosion-resistant heat exchangers or sidewall venting, and lining the 

vent/masonry systems with corrosion-resistant material can extend the thermal efficiency. 

Condensing gas appliances can be fully condensing or near condensing. Fully 

condensing appliances have flue gas temperatures less than the dew point (130 oF to 140 

oF) of the flue products. Condensation is expected in both the heat exchanger and the vent 

system. Near-condensing appliances have flue gas temperatures approaching the dew 

point of the flue gases, but still greater than the dew point. Condensation is expected in 

the vent system but not in the heat exchangers. The thermal efficiency of fully 

condensing water heaters can be as high as 99 percent. For near-condensing water 

heaters, thermal efficiency is generally between 84 and 90 percent. Manufacturers 

produce residential and commercial condensing water heaters. 

Condensing Pulse Combustion (Gas-Fired, Oil-Fired Storage, and 

Instantaneous). Pulse combustion burners for gas-fired and oil-fired storage and 

instantaneous water heaters are another condensing technology. Pulse combustion 

burners operate on self-sustaining resonating pressure waves that alternately rarefy the 

combustion chamber (drawing a fresh fuel/air mixture into the chamber) and pressurize it 

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(causing ignition by compression heating of the mixture to its flash point). This process is 

initiated by a blower supplying an initial fuel and air mixture to the combustion chamber. 

A spark ignites the mixture. Once resonance is initiated, the process becomes selfsustaining. 

Pulse combustion systems feature high heat transfer rates, can self-vent, and can 

draw outside air for combustion even when installed inside. Because the pulse 

combustion process is highly efficient, the burners are generally used with condensing 

appliances. 

Thermophotovoltaic and Thermoelectric Generators (Gas-Fired, Oil-Fired 

Storage, and Instantaneous). Heat and light energy can be extracted from the 

combustion process of gas-fired and oil-fired storage and instantaneous water heaters and 

converted into useful electrical energy. Thermophotovoltaic generator technology uses a 

special light-emitting burner coupled with silicon photovoltaic cells that generate 

auxiliary power that can run a fan, operate the electronic ignition and controls, and charge 

a battery. This avoids the requirement of an auxiliary electrical supply, while offering the 

efficiency advantages of electronic ignition and forced-draft combustion. 

Another method of generating electricity at the water heater is based on 

thermoelectric technology. Thermoelectric generators use semiconductors to convert a 

temperature differential into a voltage source. This voltage source can provide power to 

run a fan, operate the electronic ignition and controls, and charge a battery, similar to the 

thermophotovoltaic generator. Thermoelectric generators are available, but none have 

been used to generate auxiliary power for water heaters. 

Reduced Burner Size (Slow Recovery) (Gas-Fired, Oil-Fired Storage, and 

Instantaneous). Reducing burner size for gas-fired and oil-fired storage and 

instantaneous water heaters while keeping flue baffle and tank geometry the same will 

increase the ratio of heat transfer surface area to energy input, thereby increasing the 

recovery efficiency. The lower energy input means that recovery would be slower than 

with conventional burners. 

Timer Control (Electric Storage). This technology option limits the time of day 

when the elements of an electric storage water heater may be energized. This is most 

often used as part of an electric utility demand-side management program for load 

shifting (“demand avoidance strategy”). Energy savings are possible because the water in 

the tank remains at a reduced temperature for part of the day. However, the actual energy 

savings will depend on the end-use profile, lifestyle of the consumer, and a basic desire to 

save energy. Savings will be greater for water heaters where standby loss levels are high 

because the electric consumption, in response to the standby losses, shifts from on-peak 

to off-peak times when electricity costs less. 

After-market timer controls for water heaters are commercially available. Some 

utilities also offer load-shifting controls for water heaters to reduce peak daytime 

demand. 

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Two-Phase Thermosiphon (Gas-Fired, Oil-Fired Storage). Two-phase 

thermosiphon (TPTS) technology removes the flue from the center of gas-fired and oilfired storage water heaters and places a heat exchanger outside the storage tank, reducing 

standby losses. This is similar to the side-arm heater technology option. TPTSs are heatpipe mechanisms that transfer heat from the external burner to the storage tank. The 

TPTS is a closed loop device consisting of an evaporator, in which the working fluid 

(water) is heated by the burner, percolating liquid and vapor into the condenser where 

heat is transferred into the water storage tank. At the condenser, which is inside the 

storage tank, the vaporized working fluid is condensed and drains back through a separate 

restricted tube to the evaporator, where it is reheated. The restriction prevents the heated 

vapor and liquid from flowing to the condenser through the return path. During off-cycle, 

there is very little heat transfer through the TPTS system. This reduces standby losses to 

levels similar to those of electric water heaters. 

Modulating Controls (Instantaneous). Modulating controls within an 

instantaneous water heater can reduce energy consumption, improve efficiency, and 

improve overall performance by changing the operating conditions in response to 

household demand. Basic controls (i.e., those without modulation) operate at either the 

minimum or the maximum output levels, based on simple inputs from either the user or 

the water heater. Alternatively, modulating controls can reduce output so that excess 

energy is not wasted when only small temperature differentials or low flow rates need to 

be satisfied. By modulating the controls, the demand can be met more precisely by the 

appropriate outputs. For example, a control will not open fully to correct a small 

differential; rather, the control will modulate to a lower, or stepped, position to avoid 

wasting energy. An added benefit to modulation is the elimination of stacking, the effect 

of overheating due to a succession of short hot water draws. Stacking can lead to scalding 

and other safety issues. Finally, duty cycling can be reduced, which can reduce the total 

amount of energy consumed. Several manufacturers currently include modulating 

controls in instantaneous water heaters. 

Intelligent Controls (Gas-Fired, Oil-Fired, Electric Storage, and 

Instantaneous). Intelligent controls, self diagnostics, and electronic controls for storage 

and instantaneous water heaters minimize energy consumption and maximize hot water 

output. Monitoring functions typically operate to minimize operating cost while still 

meeting household demand. This works by tracking usage patterns and adjusting water 

heater operations to maximize efficiency. Also, water heaters may employ economizer 

modes to limit the maximum temperature to reduce energy consumption. Smart vacation 

settings operate to minimize energy usage while maintaining temperatures above 

freezing. Diagnostic software may also maintain the optimal burner conditions, valve 

positions, and air-to-fuel ratios to maximize efficiency, for example. Several storage- and 

instantaneous-type water heaters incorporate intelligent, self-diagnostic, and electronic 

controls. 

Self-Cleaning (Gas-Fired, Oil-Fired, Electric Storage). This technology option 

for storage water heaters is a modification of the conventional dip tube associated with 

the baseline storage water heater. Water exits a conventional dip tube with a weak 

diffusing action. Self-cleaning technology incorporates a method to introduce the inlet 

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water at high turbulence. This is accomplished by modifying the exit orifice at the end of 

the dip tube to increase the inlet velocity of the water and create a spray pattern. Designs 

may also incorporate orifices along the length of the dip tube. These introduce inlet water 

at various points within the tank to increase mixing and overall tank turbulence. Further 

designs may turn the flow path of the inlet water to a horizontal angle to increase the 

amount of swirling, or rotational turbulence. This can be accomplished by simply 

bending the dip tube. 

This technology has the benefit of self-cleaning, but this does not contribute to an 

increase in energy efficiency as measured by the DOE test procedure. By introducing the 

inlet water at higher velocities and with turbulence, naturally occurring sediment in the 

water is forced to remain in suspension. Therefore, the sediment can be drawn out of the 

tank when there is a call for hot water, instead of settling to the bottom. If long standby 

periods occur, the dip tube is designed to unseat any settled particles so that they can be 

withdrawn from the tank. This prevents the formation of permanent deposits, which 

degrade heat transfer. Deposits decrease water heater performance, can cause leaks, and 

reduce tank volume. 

3.3.2.2 Direct Heating Equipment 

DOE identified the following technology options that might improve the 

efficiency of direct heating equipment: 

1. Heat exchanger improvements 

2. Electronic ignition 

3. Thermal vent damper 

4. Electrical vent damper 

5. Power burner 

6. Induced draft 

7. Two stage and modulating operation 

8. Improved fan or blower motor efficiency 

9. Increased insulation (floor furnaces only) 

10. Condensing 

11. Condensing pulse combustion 

12. Air circulation fan 

13. Sealed combustion 

Heat Exchanger Improvements (Fan Wall, Gravity Wall, Floor, Room, 

Hearth). Improving the heat exchanger for fan wall, gravity wall, floor, room, and hearth 

heaters can improve heat transfer from combustion gases to the air. The improved heat 

transfer leads to an increase in the thermal efficiency and AFUE of direct heating 

equipment. If the AFUE increases to about 90 percent, condensation of the combustion 

gases begins to occur in the heat exchanger or vent pipe. Condensation typically occurs 

when the combustion gases are cooled to approximately 130 oF. Condensation may cause 

corrosion to the surfaces of the heat exchanger and vent pipe. To avoid such problems, 

direct heating equipment designs incorporate materials that resist corrosion and methods 

to properly collect and dispose of condensate. If the design does not include a means to 

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manage condensate, the use of this technology option will be limited to an AFUE below 

90 percent to avoid damage. 

The technology option of improved heat exchanger can be achieved by modifying 

baseline designs of standard gas-fired direct heating equipment using (1) increased heat 

exchanger surface area, (2) multiple flues, (3) multiple turns in flue, (4) direct vent, and 

(5) increased heat transfer coefficient. 

Increased Heat Exchanger Surface Area. The performance of the heat exchanger 

can be improved by simply increasing its surface area, which increases the amount of 

heat transfer occurring in the direct heating equipment. This, in turn, improves the direct 

heating equipments’ ability to extract heat from combustion gases. The result is an 

increase in the steady-state efficiency of the unit, and thus, the AFUE. 

Multiple Flues. Incorporating a multiple flue design can increase heat exchanger 

surface area. The heat exchanger heats room air by passing it through multiple tubes 

instead of a single tube. One manufacturer incorporates 15 tubes to increase the surface 

area and increase the rate of heat transfer. 

Multiple Turns in Flue. This technology increases heat exchanger surface area by 

including multiple turns in the flue pipe. Overall dimensions of the outer case do not 

necessarily need to increase to accommodate a longer flue path. The longer flue path 

increases heat exchanger surface area, which increases steady-state efficiency and AFUE 

of the unit. One manufacturer incorporates turns in a heat exchanger to increase surface 

area and AFUE. 

Direct Vent. Another method to increase surface area includes a secondary heat 

exchanger. Combustion gases exiting through the vent are used to preheat incoming air 

before it passes through the primary heat exchanger. Manufacturers currently produce 

direct heating equipment that accomplishes this by running the inlet and exhaust vents 

concentrically. These units are known as direct-vent heaters. This set up is similar to a 

shell-in-tube heat exchanger. 

Increased Heat Transfer Coefficient. An alternative to increasing the size of the 

heat exchanger is enhancing the inside and outside heat transfer coefficients of the heat 

exchanger. This can be accomplished by modifying the surface of the heat exchanger 

material for the purpose of increasing turbulence in the air passing close to the 

exchanger’s surface, for example. Incorporating dimples or some other surface feature to 

enhance turbulence can increase the heat transfer coefficient when correctly designed. 

Also, the heat exchanger may be constructed of a material with a higher thermal 

conductivity than the standard copper that is typically used. 

Electronic Ignition (Fan Wall, Gravity Wall, Floor, Room, Hearth). All gravitytype heaters and the majority of fan-type heaters have a standing pilot ignition system. In 

direct heating equipment, standing pilots continuously burn gas. The efficiency of the fan 

wall, gravity wall, floor, room, and hearth heaters can be improved by simply replacing 

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the standing pilot ignition system with an electronic one, such as an intermittent pilot 

system or a hot surface ignition system. This eliminates the need for the standing pilot. 

In assessing the impact on energy consumption, it is important to account for the 

added electrical energy consumption of the electronic ignition device in addition to the 

reduction in gas energy consumption that results from eliminating the standing pilot. 

The two standing pilot ignition systems for gravity heaters, hydraulic and 

millivolt, do not require an outside source of electricity to operate. Consequently, these 

gas valves are more complex and more costly than those of an ignition system requiring a 

separate power source. For both the hydraulic and millivolt systems, the small amount of 

electricity that is required by the gas valve and thermostat is generated by either a 

thermocouple or thermopile. The thermocouple or thermopile draws its power from the 

burning pilot, and only a small fraction of the heat energy is converted to electricity. The 

pilot burns at approximately 775 Btu/hr constantly, and the electrical power typically 

required is only around 1 Watt, or 3.5 Btu/hr. The remaining heat is lost or transferred to 

the room (even when there is no call for heating). 

For fan wall furnaces that already require an outside source of electricity to 

operate the fan, the electronic ignition system is powered off the fan power supply. The 

power draw of the fan power supply transformer occurs continuously. For direct heating 

equipment that does not already require electricity, a means to supply power must be 

included in the design. 

Both hot surface and intermittent pilot electronic ignitions require an outside 

source of electricity to operate. The gas valve for each electronic ignition system 

typically only consumes power during a call for heat. The control module, which houses 

the electronic circuitry required to control the entire ignition system, typically only 

consumes power during a call for heat. Finally, the electronic thermostat draws power 

continuously (regardless of whether heat is needed). These power requirements in total 

are typically less than the pilot burn rate. Manufacturers currently produce direct heating 

equipment with electronic ignition. 

Thermal Vent Damper (Fan Wall, Gravity Wall, Floor, Room, Hearth). Vent 

dampers are installed between the draft hood and the vent pipe of fan wall, gravity wall, 

floor, or room heaters. Vent dampers improve efficiency primarily by reducing off-cycle 

infiltration and off-cycle sensible heat losses. Vent dampers have no effect on steadystate efficiency because they do not improve heat transfer. 

A pair of bi-metal coil springs activate thermal vent dampers. Heat created by 

combustion gases causes the two coil springs to contract and open the damper blade. 

After heating discontinues, the springs cool and expand, closing the damper. Response 

time to open and close the damper varies and may be slow because the bi-metal coil 

spring does not heat up or cool down instantaneously. Thermal vent dampers can be 

installed on units using either a standing pilot or an electronic ignition system. In the 

closed position, thermal vent dampers allow some bypass to ensure that combustion gases 

will not be trapped within the heat exchanger during start up. The bypass also allows the 

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venting of flue gases from a standing pilot. Adding a bypass reduces off-cycle losses 

because the damper is only partially closed. 

Combustion products must maintain a certain amount of heat in order to expand 

the bi-metal coil springs of the thermal vent damper. If a high efficiency heater transfers 

nearly all heat to a room and an insufficient amount of heat remains in the combustion 

gases on contact with the thermal vent damper, there will not be enough heat to open the 

damper. 

Electrical Vent Damper (Fan Wall, Gravity Wall, Floor, Room, Hearth). In 

direct heating equipment, vent dampers are installed between the draft hood and the vent 

pipe of fan wall, gravity wall, floor, room, and hearth heaters. Vent dampers improve 

efficiency primarily by reducing off-cycle infiltration and off-cycle sensible heat losses. 

Vent dampers have no effect on steady-state efficiency. Vent dampers have no affect on 

steady-state efficiency because they do not improve heat transfer. 

An external source of electricity is needed for electrical vent damper operation. 

Sensors indicate when the burner is off, allowing for fast closure of the damper. This 

results in a greater reduction in off-cycle losses than can be achieved with thermally 

activated vent dampers. Electric vent dampers include safety interlocks to prevent burner 

operation when the damper is not fully open. Unlike thermal dampers, electric dampers 

do not allow for bypass since they can open immediately upon burner operation, unless 

standing pilot ignition is employed. When standing pilots are in use, a knockout on the 

damper allows standing pilot combustion gases to vent when the damper is fully closed. 

Safety concerns do exist. A power failure may cause the electrical damper to 

remain closed and not cycle open while the heater operates to meet heating demands. 

This issue is mitigated by including safety interlocks that allow operation of the burner 

only when the damper is in the open position. Also, a spring return actuator that fails in 

the open position can be used. In this case, when the electric vent damper experiences a 

power loss, a spring forces the damper to the open position. 

Electrical dampers require an electrical connection, but use only a nominal 

amount of power during opening and closing. Spring return dampers, if installed, require 

only a nominal amount of power as well. Power is required while opening and holding 

closed during standby periods (to overcome the return spring). 

Power Burner (Fan Wall, Gravity Wall, Floor, Room, Hearth). Fan-assisted 

combustion systems for fan wall, gravity wall, floor, room, and hearth heaters can be 

designed with power burner technology. Power burners use blowers upstream of the 

combustion zone to supply a more efficient fuel-air mixture to the burner. Power burners 

also reduce off-cycle losses by restricting air flow and convection of warm air to the vent 

system, similar to a vent or combustion box damper. 

Increasing the amount of primary air to the burner will also increase the 

accompanying steady-state efficiency. This is accomplished without further design 

modifications to the heater. Because the power burner can be designed to overcome 

EE-2006-STD-0129 COMMENT 56.10
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relatively large pressure drops within the heat exchanger, further increases in steady-state 

efficiency can be attained by redesigning the heat exchanger system. The heat exchanger 

can be designed to be more compact with more restrictions so that more heat can be 

extracted from the combustion gases. As efficiency increases, condensation of 

combustion gases within the vent system becomes more likely. Condensation of 

combustion gases should be avoided unless the system is specifically designed as fully 

condensing direct heating equipment. 

Induced Draft (Fan Wall, Gravity Wall, Floor, Room, Hearth). Fan-assisted 

combustion systems for fan wall, gravity wall, floor, room, and hearth heaters can be 

designed with induced draft technology. Induced draft fans are located downstream of the 

combustion zone (at the exit of the heat exchanger) and regulate the amount of primary 

air at the burner resulting in a higher combustion efficiency. Induced draft systems also 

reduce off-cycle losses. Since induced draft fans are located at the exit of the heat 

exchanger, they tend to reduce off-cycle infiltration losses more than power burners. The 

induced draft fan essentially acts as a vent damper to prevent heated room air from being 

drawn into the vent system. 

The space allocated for the draft hood is large enough to accommodate an induced 

draft fan. The induced draft fan could also be located anywhere along the length of the 

vent pipe as long as a draft can be maintained. Some installations may even incorporate a 

fan in the vent cap at the end of the venting system. Besides increasing AFUE, the 

steady-state efficiency will also increase because of the increasing amount of primary air 

to the burner. This increase is accomplished without further design modifications to the 

heater. Because the induced draft fan can be designed to overcome relatively large 

pressure drops within the heat exchanger, further increases in steady-state efficiency can 

be attained by redesigning the induced draft heat exchanger system. The heat exchanger 

can be redesigned to be more compact with more restrictions so that a greater amount of 

heat can be extracted from the flue gases. As efficiency increases, condensation of 

combustion gases within the vent system becomes likely. Condensation of combustion 

gases should be avoided unless the system is specifically designed as fully condensing 

direct heating equipment. 

Two-Stage and Modulating Operation (Fan Wall, Gravity Wall, Floor, Room, 

Hearth). Two-stage or modulating operation allows fan wall, gravity wall, floor, room, 

and hearth heaters to meet heating load requirements more precisely. When low heating 

load conditions exist, the heater can operate at a reduced burner rate. This reduces cycling 

of the unit, which in turn, reduces large fluctuations in room temperature. 

Two-stage or modulating burners attempt to reduce cycling of the heater by 

reducing the flow rate of gas at lower heating loads. These burners regulate gas flow but 

not air flow. Excess air is induced at lower gas flow rates, resulting in lower combustion 

efficiencies when compared to a normal or maximum gas flow rate. Because of this, 

heaters equipped with two-stage or modulating burners will always have a lower energy 

efficiency, as measured by the DOE test procedure, than heaters equipped with singlestage burners. 

EE-2006-STD-0129 COMMENT 56.10
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To overcome this lower efficiency and achieve efficient two-stage or modulating 

operation, an induced draft or forced draft system using a two-speed or variable speed 

combustion fan must incorporate the two-stage or modulating burner. With the multispeed combustion fan, the excess air drawn into the burner at low gas flow rates can be 

reduced so that there is no decrease in the steady-state efficiency of the heater. The aircirculation fan on forced-air two-stage and modulating direct heaters must also be 

capable of two-stage or variable speed operation to avoid a similar decrease in energy 

efficiency. 

Improved Fan or Blower Motor Efficiency (Fan Wall, Hearth). For fan wall and 

hearth heaters equipped with air circulation fans, the fan or blower motor efficiency can 

be increased to reduce the electrical energy consumption of the unit. 

Typical fan motor sizes are 1/20 horsepower. Since the motor is so small, 

increased efficiency would yield extremely small electrical energy savings. Direct 

heating manufacturers typically use permanent split capacitor (PSC) fan motors. The next 

jump in motor efficiency would be a permanent magnet brushless DC (BLDC) motor. A 

brushless DC motor uses electronic controls to commutate the motor, eliminating brush 

friction and losses, and therefore increasing motor efficiency. BLDC motors also have 

longer lifetimes than electric motors containing brushes. 

Increased Insulation (Floor). Floor furnaces are the only heater types installed 

directly in an unconditioned space. Floor furnaces are typically installed where the 

majority of the unit is below the subfloor of the first floor and in the crawlspace of a 

home. DOE considered increasing or improving the insulation of a heater only for this 

product class of DHE. Since room heaters and wall furnaces are installed in the 

conditioned space, insulation in the cabinet would only serve to minimize cabinet hot 

spots and reduce the amount of radiated heat coming off the heater. Additionally, the 

DOE test procedure calls for the measurement of jacket losses only for floor furnaces. 

Increased or improved insulation would reduce the jacket losses of this type of DHE and 

increase the overall AFUE. Insulation is installed in a floor furnace at the perimeter of the 

cabinet. 

Condensing (Fan Wall, Gravity Wall, Floor, Room, Hearth). If fan wall, gravity 

wall, floor, room, and hearth heaters are designed to have high steady-state efficiencies, 

enough heat will be extracted from the combustion gases so that condensing will occur 

within the heat exchangers. This type of heater is typically termed a condensing heater 

and AFUEs generally exceed 90 percent. One typical condensing design uses a high 

efficiency fan-assisted combustion system with additional heat exchanger surface area. 

This heater system can be designed to achieve high efficiencies that are much 

higher than non-condensing systems. In the power burner or induced draft technology 

option description, condensation of the combustion gases within the vent system was not 

desired. Since condensation is now desired, the fan-assisted system is designed to extract 

as much heat from the combustion gases as possible. Typically, condensing systems 

exhaust their combustion gases through a direct vent. Positive pressure can be maintained 

within the vent system to exhaust the low temperature combustion gases with a fan 

EE-2006-STD-0129 COMMENT 56.10
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installed upstream of the combustion zone. Conversely, negative pressure can be 

maintain within the vent system to draw combustion gases from the combustion chamber 

with a fan installed downstream of the combustion zone. The combustion gases can be 

passed through a larger or improved heat exchanger to extract as much heat as possible. 

Condensing systems require some means to collect and drain the condensate that 

develops within the heat exchangers. Condensing systems can be designed to use 

secondary heat exchangers and air circulation fans as well. 

Condensing Pulse Combustion (Fan Wall, Gravity Wall, Floor, Room, Hearth).

If a fan wall, gravity wall, floor, room, or hearth heater is designed to have a high steadystate efficiency, enough heat will be extracted from the flue gases so that condensing 

occurs within the heat exchanger. This type of heater is typically termed a condensing 

heater and AFUEs generally exceed 90 percent. One typical condensing design uses pulse 

combustion with additional heat exchanger area. 

This heater system can be designed to achieve very high efficiencies. In the power 

burner or induced draft technology option description, condensation of the combustion 

gases within the vent system was not desired due to the corrosive nature of the 

condensate. However, to achieve high AFUEs, enough heat must be extracted from the 

combustion gases to cause the combustion gases to condense. Condensing pulse 

combustion systems are designed to extract as much heat from the combustion gases as 

possible. Pulse combustion systems, like a direct-vent type heater, draw combustion air 

from the outside. Once ignition is accomplished, the pulse combustion process is selfsustaining. The turbulent nature of the pulse combustion process requires no mechanical 

devices (e.g., induced draft fans or power burners) to vent the combustion products to the 

outside. Pulse combustion designs may use a secondary heat exchanger and an air 

circulation fan to increase steady-state efficiency. The secondary heat exchanger is 

usually located at the forced air blower outlet and before the combustion air enters the 

combustion chamber. Part of the efficiency gain comes from capturing the heat of 

vaporization of the combustion gases before they are expelled to the outside. Combustion 

gases condense because the temperature of the vented gases falls to about 130 °F. A 

condensate drain is usually needed to route the condensed moisture into a floor drain. 

Air Circulation Fan (Floor, Room). Air circulation fans improve the steady-state 

efficiency of floor and room heaters by circulating air in a counter-current mode to the 

flow of combustion products. In gravity-type heaters, room air circulates co-current with 

the combustion products, driven only by the thermal buoyant forces. Counter-current heat 

exchangers are inherently more efficient than co-flowing types. In addition, the higher air 

flow rates that occur in forced-air heaters result in higher heat transfer coefficients than 

gravity-type heaters can achieve. 

AFUE increases due to air circulation fans result solely from improving the 

steady-state efficiency of the heater. This technology is only considered for room heaters 

and floor furnaces. Air circulation fans are known to be easily incorporated into currently 

available room heater models as manufacturers already provide consumers with the 

option of purchasing fans for these units. Though floor furnaces do not currently have the 

EE-2006-STD-0129 COMMENT 56.10
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option of adding a circulation fan, DOE believes the cabinet is large enough to 

incorporate a fan without having to enlarge the cabinet. 

Sealed Combustion (Fan Wall, Gravity Wall, Floor, Room, Hearth). Fan wall, 

gravity wall, floor, room, and hearth heaters that pull air from the conditioned space to 

use for the combustion process waste heat. Removing energy in the form of heated air 

and exhausting it outside of the conditioned space is inherently less efficient than 

drawing outside air for the combustion process. Fan wall, gravity wall, floor, and room 

direct heating equipment with sealed combustion chambers prevents heat rejection from 

occurring. Using outside air for heating ensures that air within the conditioned space is 

not used for combustion. 

Unlike sealed combustion heaters (which do not induce any pressure), non-sealed 

combustion heaters induce negative pressure during operation. When air is exhausted 

from a conditioned space, the removed air must be replaced to satisfy the induced 

pressure differential. This happens naturally by infiltration, or leaking, of cool outside air 

into the conditioned space. Sealed combustion does not contribute to exchanges of air 

between the interior conditioned spaces and exterior unconditioned spaces. 

Sealed combustion provides inherent safety benefits. Sealing the combustion 

process prevents harmful combustion gases from mixing and accumulating in the 

conditioned space. Combustion products are exhausted outside the space. 

3.3.2.3 Pool Heaters 

The following technology options could improve the efficiency of pool heaters: 

1. Electronic ignition 

2. Improved heat exchanger design 

3. More effective insulation (combustion chamber) 

4. Power venting 

5. Sealed combustion 

6. Condensing pulse combustion 

7. Condensing 

Electronic Ignition. One of the most common ways to reduce energy 

consumption of pool heaters is to eliminate the standing pilot light as a method of 

igniting the main burner. Pool heater manufacturers already make heaters with electronic 

ignition and many different variations in models are available. Since February 1984, 

California has required that pool heaters use electronic ignition instead of standing pilot 

lights. Three electronic ignition devices are used in gas-fired pool heaters: 

Intermittent Pilot Ignition. This device lights a pilot by generating a spark, which 

in turn lights the main burner. 

Intermittent Direct Ignition. This system lights the main burner directly by 

generating a spark. 

EE-2006-STD-0129 COMMENT 56.10
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Hot Surface Ignition. This system lights the main burner directly from a 

sufficiently hot surface. 

Unlike standing pilot ignition systems that consume gas continuously, these 

devices operate only at the beginning of each on-period. Although there is no increase in 

the steady-state efficiency when using electronic ignition devices, the overall fuel 

consumption is reduced. Pool heater pilot lights typically consume approximately 1,100 

Btu/hr on average. 

Improved Heat Exchanger Design. Pool heaters are currently capable of reaching 

the steady-state efficiency level where potentially damaging condensation will start to 

form on the heat exchanger. A small increase in heat exchanger size may be possible 

without causing condensation of the combustion gases by increasing the heat exchanger 

surface area. The burner configuration might also require adjustment. No blower would 

be required for this technology option. 

The heat exchanger size can also be increased while preventing condensation 

from forming by using a governor. The governor maintains pool water temperature and 

water flow to prevent condensation of combustion gases. The governor limits the 

efficiency of the heat exchanger so that the latent heat of the combustion gases is not 

transferred to the pool water. At least one manufacturer makes a pool heater with a 

condensing governor. 

If condensation is desired to achieve a high steady-state efficiency, then the pool 

heater design must properly manage and dispose of the potentially damaging condensate. 

This can be accomplished with corrosion-resistant materials and a condensate drain. 

More Effective Insulation (Combustion Chamber). Combustion chambers for 

pool heaters are insulated with fiberglass blankets to prevent heat loss through the walls 

of the combustion chamber to the exterior of the pool heater. Manufacturers reduce the 

amount of heat loss to increase the thermal efficiency by using materials with more 

effective insulation properties. Pool heater manufacturers currently produce products that 

use Fiberfrax panels and refractory tiles to reduce the amount of heat loss through the 

combustion chamber walls. By lining the sides and bottom of the heat exchanger with 

these materials, manufacturers increase the amount of heat that is transferred from the 

combustion chamber to the heat exchanger. DOE identified several manufacturers that 

use insulation that is more effective than fiberglass blankets for pool heater combustion 

chambers. 

Power Venting. Fan-assisted combustion systems for pool heaters can be 

designed with power venting technology. Induced draft fans located downstream of the 

combustion zone (at the exit of the heat exchanger) or forced draft fans located upstream 

of the combustion zone (at the entrance to the combustion chamber) regulate the amount 

of primary air at the burner resulting in a higher combustion efficiency. 

To increase the energy efficiency, a larger heat exchanger surface area (which 

increases the heat transfer rate) is required. The larger heat exchanger typically increases 

EE-2006-STD-0129 COMMENT 56.10
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the amount of restriction to the air flow path and the combustion gases are typically not 

buoyant enough to provide adequate draft. Therefore, the power vent forces combustion 

gases through the restricted heat exchanger area. Forcing the air increases turbulence, 

which increases the rate of heat transfer. The increased rate of heat transfer will in turn 

increase steady-state efficiency and energy efficiency. Configuration of other parts of the 

pool heater, such as the combustion chamber and burner, can remain constant with this 

technology option. However, additional alterations of the heat exchanger may be needed 

if condensing occurs, which can corrode the heat exchanger. 

Sealed Combustion. Pool heater combustion processes require a regulated ratio of 

fuel to air to be efficient. The primary air for the combustion chamber must be supplied at 

a constant rate without any fluctuations. To maintain a specific supply of primary air, 

manufacturers seal the combustion chamber of the pool heater. Manufacturers produce 

pool heaters with seal combustion chambers and air intakes that operate at consistent 

energy efficiency levels regardless of outside conditions. Pool heaters, particularly those 

installed outdoors, without seal combustion chambers are susceptible to reductions in 

thermal efficiency in high winds. Pressure and air flow variations caused by ambient 

conditions can vary the amount of primary air supplied to the burners, which can reduce 

burner efficiency. Several manufacturers produce pool heaters with sealed combustion 

chambers. 

Condensing Pulse Combustion. To increase the energy efficiency of a pool 

heater, the water vapor in the combustion gases must be condensed to capture the heat of 

vaporization. The heat exchanger must be altered for condensing operations to prevent 

the acidic condensate from corroding the heat exchanger. A condensate drain is also 

required. 

Condensing can be accomplished by using pulse combustion burners. These 

burners operate with self-sustaining resonating pressure waves that alternately ratify the 

combustion chamber (causing a fresh fuel/air mixture to enter the chamber) and 

pressurize it (causing ignition by compression of the mixture to its flash point). This 

process is initiated by a blower that supplies the initial fuel and air mixture to the 

chamber. The fuel and air mixture is ignited with a spark igniter. Once resonation is 

established, the process becomes self-sustaining. Pulse combustion systems feature high 

heat transfer rates through the heat exchanger due to increased turbulence of combustion 

gases. High-efficiency gas-fired boilers using pulse combustion are currently available. 

Condensing. To increase the efficiency of a pool heater, the water vapor in the 

combustion gases must be condensed in order to capture the heat of vaporization. The 

heat exchanger must be altered for condensing operations to prevent condensate from 

corroding the heat exchanger. A condensate drain is also required. 

This technology option uses a radiant burner, a modified heat exchanger to 

condense the combustion gases, and a burner located above the heat exchanger to prevent 

corrosion from contact with condensate. A ceramic matrix radiant burner is located above 

a series of finned heat exchanger tubes. A blower forces an air and gas mixture through 

the ceramic matrix burner and down past the heat exchanger. Most of the heat is radiated 

EE-2006-STD-0129 COMMENT 56.10
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to the heat exchanger. By locating the burner above the heat exchanger and out of the 

way of any condensation, the burner does not require corrosion protection. The heat 

exchanger must still be corrosion-resistant, however, and a condensate drain must be 

installed. 

3.3.3 Technologies That Do Not Affect Energy Efficiency as Measured 

DOE reviewed the technologies presented in the previous assessment and 

considered their impacts on DOE’s test procedure results as well as their impacts on 

energy use. Since EF, AFUE, and thermal efficiency are the relevant performance metrics 

in this rulemaking, DOE did not consider the technologies discussed in section 3.3.2 that 

have no effect on EF, AFUE, or thermal efficiency during the screening analysis. 

However, DOE does not discourage manufacturers from using these technologies 

because they might reduce annual energy consumption. In this section, DOE explains 

why these technologies do not affect EF, AFUE, or thermal efficiency. 

3.3.3.1 Water Heaters 

The following technology options either do not effect or do not increase the EF of 

residential water heaters: timer controls, self-cleaning, intelligent controls, and 

modulating controls. 

Timer Controls (Electric). Timer controls affect the time of day when the 

elements of an electric storage water heater may be energized. This feature has the 

potential to reduce energy use because the water in the tank remains at a reduced 

temperature for part of the day.52 These savings are achieved because the electric 

consumption, in response to the standby losses, is shifted from on-peak to off-peak times 

when electricity costs less. 

However, the DOE test procedure for electric storage water heaters does not show 

the effects of timer controls because the test specifies normal operation for the water 

heater during the entire testing period. Additionally, this technology affects the energy 

consumption pattern of the water heater and not energy efficiency because load is shifted, 

not reduced. The typical use of the average consumer is specified by the test procedure, 

and time of day and conditions of an electrical supply grid (on-peak or off-peak) are not 

factors. Although this technology can reduce peak energy demand and reduce overall 

energy costs to the consumer throughout the year, it does not increase EF under the DOE 

test procedure for electric storage water heaters because of the specified test conditions. 

Therefore, DOE does not consider timer controls as a technology for improving EF of 

electric storage water heaters. 

Self Cleaning (Gas, Oil, Electric Storage). Self-cleaning incorporates a method 

to introduce the inlet water at high turbulence so that the sediment occurring naturally in 

the water remains in suspension and does not settle to the bottom of the tank. 

Additionally, a self-cleaning dip tube unseats sediment that accumulates during long 

standby periods. Tank cleaning does not improve EF as measured by the DOE test 

procedure. The test procedure to determine EF is 24 hours, and testing immediately 

EE-2006-STD-0129 COMMENT 56.10
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follows manufacture. Sediment build-up can reduce EF over the life of the water heater, 

but the amount of build-up that could occur in a 24-hour period, if any, would not be 

enough to affect the test results. This technology facilitates the removal of deposits, 

which can build up over the life of a water heater, which is typically 9 to 15 years. 

Deposits decrease water heater performance, reduce tank volume, and can cause leaks. 

Self-cleaning improves tank life and reduces the required maintenance, but these are not 

determinants for EF. Therefore, DOE does not consider self-cleaning as a technology for 

improving EF of electric, gas, or oil storage water heaters. 

Intelligent Controls (Gas, Oil, Electric Storage). Intelligent controls and selfdiagnostics minimize energy consumption and maximize hot water output. Several 

storage and instantaneous type water heaters currently on the market include selfdiagnostics and electronic controls. Typically, varying the temperature of the heated 

water based on the household demand minimizes energy consumption. However, the 

DOE test procedure has a set draw pattern and usage for the water heater, and specifies 

an inlet and outlet temperature for the water. As a result, there is no opportunity for 

varying temperatures to affect the EF calculation. Consequently, DOE does not consider 

intelligent controls as a technology for improving EF of electric storage, gas storage, and 

gas instantaneous water heaters. 

Modulating Controls (Instantaneous). Modulating water heater controls can 

reduce energy consumption, improve energy efficiency, and improve overall performance 

by changing the operating conditions in response to household demand. Modulating 

controls can also reduce output so that excess energy is not wasted when only small 

temperature differentials or low flow rates need to be satisfied. Although modulating 

controls can increase energy efficiency over a broad operating range, they do not affect 

EF as measured by the DOE test procedure. Due to the specified test conditions, (i.e., no 

variability in demand or delivery), there is no opportunity for varying operating 

conditions to affect the EF calculation. Therefore, DOE does not consider modulating 

controls as a technology for improving EF of instantaneous water heaters. 

3.3.3.2 Direct Heating Equipment 

DOE has not identified any technologies that do not affect or do not increase 

AFUE for residential direct heating equipment as measured by DOE’s test procedure. 

3.3.3.3 Pool Heaters 

Only one technology option has no effect on the thermal efficiency of residential 

pool heaters: electronic ignition. 

Electronic Ignition. Electronic ignition (intermittent pilot, intermittent direct, and 

hot surface ignition) reduces the energy consumption of gas-fired pool heaters by 

eliminating the standing pilot. Pool heater pilot lights burn continuously with a burn rate 

ranging from 1,000 Btu/h to 2,000 Btu/h during the pool heater operating season. 

Electronic ignition uses energy only when there is a call for heating and only until a 

flame has been established. 

EE-2006-STD-0129 COMMENT 56.10
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Electronic ignition can be used to replace the standing pilot and reduce the overall 

energy consumption of the pool heater. However, the thermal efficiency descriptor 

specified by EPCA and measured by DOE’s test procedure, does not take into account 

the energy efficiency benefits of ignition sources that are alternatives to standing pilots 

(e.g., electronic ignition). The thermal efficiency descriptor, as measured by the DOE test 

procedure, does not account for additional energy consumption of a continuous, standing 

pilot light when the burner is off because it is a steady-state test procedure and thermal 

efficiency is determined when the burner is on. That is, thermal efficiency only captures 

energy efficiency impacts that affect combustion and the transfer of energy to the water. 

The thermal efficiency descriptor does not account for any energy that a pool heater may 

use in the standby period. Therefore, standards expressed in terms of this descriptor 

cannot require use of such alternative ignition sources or capture the full energy savings 

benefit of their use. Therefore, DOE does not consider electronic ignition as a technology 

for improving thermal efficiency for pool heaters. 

EE-2006-STD-0129 COMMENT 56.10
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