Is a timer on your electric water heater worth it?

Why the water heater

A tank water heater is a battery that stores heat instead of charge. It draws 4 to 5 kilowatts while heating, then nothing for hours while the tank holds temperature. Because the tank stores the result, it does not matter much when the heating happens — hot water at 7am can have been heated at 3am. That is exactly the property a time-of-use plan rewards, and it is why water heating and car charging are the two loads those plans are built around. A family of four uses roughly 6 to 10 kWh a day heating water, second only to space heating or cooling in most homes.

On a flat rate: no

If every hour costs the same, a timer can only save through standby loss — the heat the tank leaks through its insulation while it waits. Modern tanks lose about 1 kWh a day standing; turning the element off for eight hours saves a fraction of that, then the tank reheats the water it lost. The net is a few dollars a year. What a timer can do on a flat rate is stop the heater running during the two hours nobody is home, which is worth nothing per kilowatt-hour and something in convenience. It is not a savings measure.

On a time-of-use rate: it depends on the gap

The value is simple arithmetic. Take the kilowatt-hours you move, multiply by the difference in price between the hours they were in and the hours they end up in, and multiply by the days. The gap is the number that matters, and it varies enormously by plan.

The plan in our index where a moved kilowatt-hour is worth most is TOU-D-5-8PM-CPP at Southern California Edison Co: about $430 a year for every kilowatt-hour a day shifted from 5pm to midnight, so a water heater timer there is worth several hundred dollars. The median time-of-use plan charges 2.6× more at peak than off-peak, which for most tariffs is a gap of 10 to 20 cents. Your own plan’s gap is on its rate page, in the legend above the schedule grid.

Setting it up

• Heat in the last off-peak hours before morning. A tank heated at 4am is still hot at 7am; one heated at 10pm has leaked for nine hours. Set the on-window to end just before peak begins.
• Allow a second window if peak is long. A 4pm-to-9pm peak means the tank has to carry the household from morning until 9pm. Most 50-gallon tanks can; a 40-gallon tank with teenagers may not, and a short midday window on a shoulder rate is cheaper than running out.
• Turn the thermostat up a few degrees, not down. A hotter tank stores more usable heat between windows. Stay under 140°F and fit a mixing valve at the outlet if there are children.
• A smart heater or a utility program does the same job. Many utilities now offer a connected controller free, in exchange for the right to shift your heater during grid events. That is a timer with a rebate.

Heat pump water heaters are different

A heat pump water heater uses a quarter of the electricity of a resistance tank, so there is less to move — and it heats slowly, so it needs a longer window. The savings from a timer shrink, and the risk of running out grows. Most of them have a built-in schedule that handles this better than an external timer would.