Author Topic: Water Heater Efficiency?  (Read 1645 times)


  • 5 O'Clock Shadow
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Water Heater Efficiency?
« on: February 18, 2016, 06:31:24 PM »
I recently bought an multifamily (will post about it once I get settled into it) and am thinking of ways to cut some costs.

I have a natural gas furnace - the picture is attached. I believe it is from 1960, and works fine. It was converted from an oil furnace to a natural gas furnace in the 80s I believe. It has a 115 gallon hot water holding tank.

I use about $4k/year in natural gas for the tenant's hot water, and am wondering if anyone has an educated guess as to the efficiency of  furnaces from that era? I know they make new highly efficient 95%+ heaters and want to figure out a ballpark figure of what the cost savings is. I think if I can reasonably assume that it is below 70% efficient that I'll seriously consider replacing.


  • Bristles
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Re: Water Heater Efficiency?
« Reply #1 on: February 18, 2016, 08:20:39 PM »
Open flame, uninsulated tank, $4k a year for hot water....yikes!

That thing needs to go to a

Get a pro out there asap to give you a estimate on a efficient system. I'm sure it'll pay for itself in no time!


  • 5 O'Clock Shadow
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  • Posts: 19
Re: Water Heater Efficiency?
« Reply #2 on: February 19, 2016, 09:18:54 AM »
It's for 16 units, so it comes to about $20/mo per unit for hot water - not too outrageous I thought?

Does that mean you think its below 70% efficient? I've tried to research efficiency from that era, best I could find was something from the 70s that was estimated 70% efficiency.


  • 5 O'Clock Shadow
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Re: Water Heater Efficiency?
« Reply #3 on: February 22, 2016, 04:39:02 PM »
It may be $20/mo for each unit, but you are paying for it, right?

I've never replaced a water heater like this, just furnaces and air conditioning units, but I also worked for an ESCO that did projects like this for large building owners, and here is how I would look at it.

Call three or four companies that replace this kind of unit. See what they would propose to replace what you have now, and ask them how they derived their sizing information.

They should be able to show you some calculations in order to determine the size of the unit.

It may be possible that new low flow shower heads would cut your hot water consumption, which would cut your overall energy spend as well as your up front capital costs.

That said, using the income valuation approach an improvement in net operating income increases the value of the property. So if you can cut your energy spend by 50% ($2,000/yr) and your cap rate is, say 8% then you can take 2000/.08 and find that the project increases the value of the building by $25,000.


  • Magnum Stache
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