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Lowering your water heater temperature could save more than $400

Written by Jackie Whetzel

Last updated February 10, 2020

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It might not be hot now, but Texans know better than anyone how refreshing a cool shower feels after a blistering summer day.

Most folks do it for a cooldown – not even realizing they’re putting money in their pocket every time they turn their shower temperature down and let the water flow.

But did you know that if you made it a habit of lowering your water heater temperature year-round – even in colder weather – you could scrub some of the expense from your annual energy bill? Think $450-ish

Here’s the scoop:

According to the federal Department of Energy, hot water accounts for about 18 percent of your power bill – the second largest energy expense behind heating and cooling your home.

The DOE estimates that a household can save anywhere from 4 to 22 percent on their energy bill by reducing their hot water consumption.

But implementing a cold shower routine isn’t all you can do to save money.

You can increase your energy savings considerably if you take the step of manually lowering the thermostat on your water heater.

Think about all the appliances in your home that use heated water.

The average shower uses about 10 gallons of heated water, dishwashers use an estimated 6 gallons per use and washing machines use about 25 gallons per load. All these appliances are add dollars and cents to your monthly energy bill.

The recommended temperature

So, what is the ideal temperature? Many manufacturers set water heater thermostats at 140 degrees when they sell them. But operating your water heater at this high of a temperature isn’t always necessary.

Tom Massimin, co-owner of the Hot Water Guys in Houston, says 140 degrees is really too hot for the average home. “It is scalding. The average temperature should be set at 120,” Massimin said.

The DOE agrees with this Texas business owner. The average household only needs water heaters to be set at 120 degrees, which also is the temperature suggested to “minimize mineral accumulation and corrosion in the water heater and pipes,” according to the DOE.

“Set too high, or at 140ºF, your water heater can waste anywhere from $36 to $61 annually in standby heat losses and more than $400 in demand losses,” the DOE says. Standby heat is heat loss from the water heater to a surrounding area like a cool basement.

There are, however, a few exceptions where 120 degrees isn’t optimal.

Dishwashers without a booster heater may require 130 to 140 degrees Fahrenheit to ensure the best cleaning. Lower settings also are not recommended for individuals with a suppressed immune system or chronic respiratory disease.

The DOE says “there is a very slight risk of promoting legionellae bacteria” when the temperature is set to 120 degrees. However, they say this heat setting is perfectly safe for the majority of people.

Tankless water heaters – an easy temperature change

If you own a tankless hot water heater, you’re in luck. Experts say it is one of the easiest to adjust the temperature on to start saving money.

While other types of hot water heaters typically only offer a cooler or warmer setting choice, the tankless water heater makes it as easy as adjusting the heating and cooling thermostat in your home.

“They don’t really give you an option to change the actual degrees,” Massimin says regarding tank water heaters. “With tankless water heaters, you get the exact temperature the machine is set at.”

While simple temperature adjustments make a tankless water heater sound intriguing, Massimin there are additional benefits to owning one.

“Down here in Texas we get about 70 percent in energy savings switching from a tank to a tankless,” he said.

The price tag on a tankless water heater can cost you about three times more, but you get about four times the life expectancy out of it, according to Massimin.

“In a lot of newer homes where they have two water heaters, the cost is about two thirds, because you’re replacing two tanks with one tankless,” he said. “But you also reduce the chance of leaks tremendously.”

Tips when lowering a water heater’s thermostat

There are a few tips to keep in mind when changing your hot water heater’s temperature. However, we always recommend that you follow your water heater owner’s manual for instructions on how to properly operate your appliance.

  • Always turn off the electricity to the water heater before opening any panels.
  • Electric water heaters thermostats are usually found behind one or more panels so have a screw gun handy.
  • When you remove the panel(s), you’ll want to pull back the insulation so you can get to the thermostat. You’ll need to put the insulation back in place after you’re done, so don’t completely remove it.
  • You may notice some electric water heaters have two different thermostats – one for the upper element and another for the lower. If you own a single element water heater, you’ll want to remove the bottom panel.
  • Gas water heater thermostat dials are usually located on the bottom of the tank on a gas control valve.


Jackie Whetzel is a freelance writer for She also is a reporter who has written articles on energy, government, business, economic development and education.  Her work has been featured in newspapers across the country.

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