Is Your Water Heater Raising Your Bill? What You Must Know

The water heater in your home is one of the most energy-hungry appliances in your home. So when your water heater is not working optimally, it has the potential to raise your monthly bill for running this device. So, how do you know if the water heater is raising your bill, and what can you do about it?

It is certainly possible for a water heater to increase your utility bill. Several factors can reduce the efficiency, including a unit that is too small, too old, bad water, or an incorrectly set thermostat can increase the energy bill. Leaks and long pipes can increase your water usage.

The water heater unit may be one of the largest energy-using appliances in your home, but it may result in higher bills for other utilities in your home as well. We will look at how your water heater can raise your utility bill and what you can do to reduce these costs.

Can A Water Heater Make Your Bill Go Up?

Your water heater can influence the monthly cost of your utility bill in several ways. If you think about what your water heater consumes and what it contains, you will see how your bill can go up if all is not well with your water heater.

Your water heater consumes energy to generate the heat needed to warm up the water it contains to supply your home with your hot water needs. These commodities, energy, and water are cost factors that will influence your utility bill.

Can A Faulty Hot Water Heater Use More Electricity?

Several factors relating to your water heater influence its efficiency and effectiveness in doing its job. If you observe a gradual or sudden increase trend in your utility bill, the culprit may be your water heater.

The circumstances can cause your water heater to raise your bill.

  • Age. Water heaters generally have a lifespan of between 10 and 15-years. If your water heater unit is older than this, its efficiency will have started to decline, which will definitely cause an increase in your energy bill as the heater takes longer to warm up the water. The remedy is to replace the water heater.
  • Energy efficiency rating. Most reputable water heater manufacturers will give their units an energy efficiency rating on an Energy Guide label on the unit. Cheap units may not display this information because they do not comply with energy-efficient protocols and will use more energy. The solution is to replace the heater with a more energy-efficient model.
  • The thermostat is set too high. If the thermostat on your water heater is set too high, the water will constantly be kept at a scorchingly hot temperature. The water heater will continuously work hard to maintain this high temperature. If the water temperature that comes out of your hot water faucet is scorching, try turning the thermostat down a little and see if the new temperature is suitable. The solution is to turn down the thermostat. This will reduce the energy consumption of the water heater.
  • Hard water. Hard water contains many minerals and sediments that can settle at the bottom of your water heater and also coat the heating element reducing its effectiveness in heating the water. This will contribute to a higher energy bill. As little as a quarter-inch of lime and mineral deposits on the bottom of your water heater tank can lower the unit’s efficiency by as much as 20%.The solution is to flush your water heater once a year to get rid of the sediment.
  • Low capacity. If your water heater is too small, the unit will be working continuously to try and keep up with the household demand for hot water. This could increase the energy bill as the water heater is constantly heating the cold water flowing into the tank. Installing a larger capacity water heater to meet the demand will be more energy-efficient.
  • A malfunction. Water heaters have a long lifespan, but things do occasionally go wrong. A faulty heating element can cause the unit to heat the water constantly and fail to switch off when the water is up to temperature. The thermostat can go faulty, causing the water heater to constantly overheat the water. This is often noticeable by steam venting through the overflow pipe or water constantly dripping from the overflow as the steam condenses. The solution is to replace the thermostat or replace the water heater.

Your water heater consumes energy, which is a cost factor, but the unit houses water, another component of your utility bill that the water heater can affect.

Can A Water Heater Increase Your Water Usage?

Another component of your utility bill is your water usage. Your water heater contains a large volume of water at any one time. When things are not optimal with your water heater, the increased costs may relate to your energy and water bills.

  • Long pipes. If the length of the pipes from the water heater to the faucet is a significant distance, you will need to run the water out of the tap for some time before warm water is dispensed. This uses additional water and raises the water bill and will also result in more water being taken from the water heater, resulting in more energy being used to heat the cold water entering the tank. The solution is to install a small capacity water heater closer to the outlet. This will reduce both water and energy consumption.
  • Water heaters have water inlet and outlet connections to provide the necessary water flow for the unit. Faulty fixtures or leaking connections and pipes can go unnoticed at the water heater because it is not an appliance you see every day. The leaks can become significant and result in an increase in the water usage bill and your energy usage bill. If you notice an increase in water and energy usage, an inspection of your water heater can prevent further cost increases.


Can A Water Heater Cause High Gas Bill?

Some water heaters operate from gas or natural gas, and the water heater can make up as much as 15% of your total natural gas bill.

Old gas water heaters can suffer from inefficiencies that can lower their effectiveness and increase fuel usage. Lime and mineral build-up in these gas water heaters will have the same effect as with electric water heaters and need to be drained periodically to get rid of the sediment.

Gas pipes and connections can also become old and perished and result in gas leaks, which can be dangerous and contribute to an increase in your gas bill.

Service your gas water heater regularly, and if it is on the far side of its lifespan, replace it with a newer model, which is more efficient and will reduce your gas bill.


If you notice any increase in your utility bills, be it gradual or sudden, the water heater unit should be the first port of call to inspect for any potential problems contributing to the raised bill.

Since the water heater is a significant energy consumer in the household, when things go wrong with this unit, or it has been set incorrectly, the costs can quickly escalate on your bill.

Annual servicing and inspections of the water heater can help to catch problems before they become too pricey, and replacing an aging unit can save you money in the long run.