Water heating is the third largest energy expense in your home. It typically accounts for about 13% of your utility bill.

What you can do:

There are five ways to cut your water heating bills:

1. Use less hot water
2. Turn down the thermostat on your water heater to 120 degree 
3. Insulate hot water pipes
4. Buy a new, more efficient water heater
5. Install a water heater timer and heat water during off-peak rates

The fifth way only works for households that have an electric water heater and their utility company provides reduced off-peak pricing for electricity: install a timer that automatically turns on the hot water heater when off peak rates are in effect and shuts off the water heater when those rates are not in effect.

Savings:

• Turn down thermostat: you’ll save 3-5% ($10-$30) for every 10 degree reduction in temperature. Many thermostats are set at 140 degrees and so resetting the thermostat to 120 degrees could save as much as $60/year.
• Insulate hot water pipes: $15-$20/year
• Install a water heater timer and heat water during off-peak rates: up to $150/year