What is a high-efficiency water heater?

A high-efficiency water heater is one that uses a small amount of energy to keep the water in a home or business warm. Energy efficiency is indicated by the EF rating; the higher the number, the greater the water heater's efficiency.

The EF rating is based on the recovery efficiency, standby losses and cycling losses. The recovery efficiency is the time it takes energy to heat the water. The standby loss is how much heat is lost per hour from the saved water. The cycling loss is the amount of heat that is lost as the water circulates through the heater.