<P> Energy efficiencies of water heaters in residential use can vary greatly, particularly depending on manufacturer and model . However, electric heaters tend to be slightly more efficient (not counting power station losses) with recovery efficiency (how efficiently energy transfers to the water) reaching about 98% . Gas fired heaters have maximum recovery efficiencies of only about 82--94% (the remaining heat is lost with the flue gasses). Overall energy factors can be as low as 80% for electric and 50% for gas systems . Natural gas and propane tank water heaters with energy factors of 62% or greater, as well as electric tank water heaters with energy factors of 93% or greater, are considered high - efficiency units . Energy Star - qualified natural gas and propane tank water heaters (as of September 2010) have energy factors of 67% or higher, which is usually achieved using an intermittent pilot together with an automatic flue damper, baffle blowers, or power venting . Direct electric resistance tank water heaters are not included in the Energy Star program, however, the Energy Star program does include electric heat pump units with energy factors of 200% or higher . Tankless gas water heaters (as of 2015) must have an energy factor of 90% or higher for Energy Star qualification . Since electricity production in thermal plants has efficiency levels ranging from only 15% to slightly over 55% (combined cycle gas turbine), with around 40% typical for thermal power stations, direct resistance electric water heating may be the least energy efficient option . However, use of a heat pump can make electric water heaters much more energy efficient and lead to a decrease in carbon dioxide emissions, even more so if a low carbon source of electricity is used . </P> <P> Unfortunately, it takes a great deal of energy to heat water, as one may experience when waiting to boil a gallon of water on a stove . For this reason, tankless on - demand water heaters require a powerful energy source . A standard 120 - V, 15 - ampere rated wall electric outlet, by comparison, only sources enough power to warm a disappointingly small amount of water: about 0.17 US gallons (0.64 L) per minute at 40 ° C (72 ° F) temperature elevation . </P> <P> On April 16, 2015, as part of the National Appliance Energy Conservation Act (NAECA), new minimum standards for efficiency of residential water heaters set by the United States Department of Energy went into effect . All new gas storage tank water heaters with capacities smaller than 55 US gallons (210 l; 46 imp gal) sold in the United States in 2015 or later shall have an energy factor of at least 60% (for 50 - US - gallon units, higher for smaller units), increased from the pre-2015 minimum standard of 58% energy factor for 50 - US - gallon gas units . Electric storage tank water heaters with capacities less than 55 US gallons sold in the United States shall have an energy factor of at least 95%, increased from the pre-2015 minimum standard of 90% for 50 - US - gallon electric units . </P> <P> Under the 2015 standard, for the first time, storage water heaters with capacities of 55 US gallons or larger now face stricter efficiency requirements than those of 50 US gallons or less . Under the pre-2015 standard, a 75 - US - gallon (280 l; 62 imp gal) gas storage water heater with a nominal input of 75,000 British thermal units (79,000 kJ) or less was able to have an energy factor as low as 53%, while under the 2015 standard, the minimum energy factor for a 75 - US - gallon gas storage tank water heater is now 74%, which can only be achieved by using condensing technology . Storage water heaters with a nominal input of 75,000 btu or greater are not currently affected by these requirements, since energy factor is not defined for such units . An 80 - US - gallon (300 l; 67 imp gal) electric storage tank water heater was able to have a minimum energy factor of 86% under the pre-2015 standard, while under the 2015 standard, the minimum energy factor for an 80 - gallon electric storage tank water heater is now 197%, which is only possible with heat pump technology . This rating measures efficiency at the point of use . Depending on how electricity is generated, overall efficiency may be much lower . For example, in a traditional coal plant, only about 30--35% of the energy in the coal ends up as electricity on the other end of the generator . Losses on the electrical grid (including line losses and voltage transformation losses) reduce electrical efficiency further . According to data from the Energy Information Administration, transmission and distribution losses in 2005 consumed 6.1% of net generation . In contrast, 90% of natural gas' energy value is delivered to the consumer . (In neither case is the energy expended exploring, developing and extracting coal or natural gas resources included in the quoted efficiency numbers .) Gas tankless water heaters shall have an energy factor of 82% or greater under the 2015 standards, which corresponds to the pre-2015 Energy Star standard . </P>

Where does the heating process begin in a hot water heater system