Water heating is the third largest energy expense in U.S. households.
Reducing your water use in general saves you money and saves the energy used to purify the fresh water you use and the wastewater you dispose of. Water heaters consume much of their energy just to keep a supply of hot water ready and waiting in the tank. The heat gradually leaks out of the tank until the heater turns on again to heat the water back up. Replace your old water heater with a new, higher-efficiency model. Insulate your hot water heater to minimize heat loss.