What is an Energy Guide Label and How to Use It?

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Every water heater, either built as the tank-type or tankless and sold in the US and Canada, comes with the “energy guide” label. The label provides valuable information such as how much energy a water heater uses - so buyers can accurately compare the energy use of similar models.

The provided information can help homeowners buy a water heater with higher efficiency to lower utility bills and protect the environment.

Water heaters sold in the US have the black-and-yellow “EnergyGuide” label, while in Canada, it is a black-and-white “EnerGuide” label. Both countries use similar methods to rate energy efficiency, but there are some differences. Also, some appliances that use both labels and can include an Energy Star logo also.

This is a great tool when buying a water heater as it gives more confidence to homeowners.

Note: When shopping for a new water heater, check the label for type and size info to make sure you are comparing similar models.

What can homeowners from the US find on the “EnergyGuide” label?

photo: wikipedia

If you are looking to buy a water heater in the US, you will find the following information on the EnergyGuide label:

  • Water heater type (tank or tankless)Model type and manufacturer
  • Fuel type (natural gas, propane gas, or electricity)
  • Capacity or GPM rating
  • First-hour rating - FHR
  • Estimated yearly operating costs
  • Range of energy consumption
  • Estimated annual energy consumption
  • Energy Star compliance

Storage capacity or GPM rating. Tank-type water heaters utilize storage tanks with the capacity shown in gallons. Tankless models use a maximum water flow rate expressed in gallons per minute (GPM rating).

First Hour Rating or Delivery (FHR or FHD). FHR/FHD indicates how much hot water a water heater can provide in the first hour of operation.

Estimated yearly operating costs show how much you will pay to run a water heater for one year. In the same section, you will find the cost range of similar models, helping you compare operating costs for all models and brands with similar features.

Estimated annual energy consumption is how much energy your water heater will use in a year, on average. This information depends on your local utility rates and usage.

If your water heater has an Energy Star logo on the EnergyGuide label, that means that the unit is high efficient, helping you save energy, money and reduce pollution.

Note: In the US, federal law requires the manufacturers to place the EnergyGuide label on all new water heaters and heat pumps.

To get the full benefits, pay attention to these three of the most important features (if applicable):

  • First-hour rate - FHR
  • Range of the estimated energy consumption
  • Estimated yearly operating costs

You can find more info on the official site here.

What can homeowners in Canada find on the “EnerGuide” label?

For the Canadian buyers, this is the information you will find on the EnerGuide sticker (if applicable).

  • Model’s capacity (very small, low, medium, or high) (gas only)
  • Universal Energy Factor (UEF) for gas models or standby heat loss for electric models
  • UEF (gas) or standby heat loss range (electric)
  • UEF (gas) or standby heat loss (electric) indicator which specifies how your model compares to the least and most efficient models

Standby heat loss. The energy efficiency (performance) of electric water heaters is measured by standby heat loss expressed in watts.

Standby heat loss is defined as the amount of heat lost by a water heater when it is not heating, or a hot water tap is not running.

If this number is low, the model is high efficient. So look for the lower standby heat loss number. Water heaters equipped with better insulation (high R-value) around the tank have lower heat loss.

The energy efficiency of gas water heaters is measured by the Uniform Energy Factor (UEF). The model is more efficient if the UEF number is higher. Water heaters with a UEF over 0.9 are considered ultra-efficient, and these are known as condensing. Low efficient models have a UEF of around 0.6.

Started from mid-June of 2017, water heating manufacturers are required to comply with new government testing procedures and standards, resulting in replacing EF ratings with UEF, or Uniform Energy Factor. With the new Uniform Energy Factor, everyone benefits because the new procedure provides a more consistent and accurate way to measure energy efficiency.

Note: In Canada, it is not mandatory for water heater manufacturers to use the EnerGuide label; it is voluntary. Check out the latest info on the official site here.

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How to calculate the energy costs of gas and electric water heaters?

Use the following formula to calculate the energy costs of a gas water heater:

The volume of used gas in cubic feet X gas fuel costs = energy costs


What is the energy cost if you use 50 cubic feet of gas where each cubic foot of gas costs $0.07?

50 x 0.07 = $3.5

Use the following formula to calculate the energy costs of an electric water heater:

Kwhr X fuel costs = energy costs


What is the energy cost if you use 50 kilowatt-hours of electricity where each kilowatt-hour costs $0.05?

50 x 0.05 = $2.5

Note: Always consult a water heater expert when consider buying and installing a water heater.


The energy guide label found on most home appliances, including water heaters, is a helpful guide that can help you make an energy-wise choice.

When buying a new water heater, you can use this valuable tool, compare the energy efficiency and cost savings, and get the most cost-effective model.

Keep in mind that actual savings depend on various factors, including location, climate, weather, energy rates, usage, equipment, and others.

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