Taking a few minutes to write down a few of my thoughts on utility energy efficiency programs, tax credits, utility or third party financing for efficiency projects, and how this relates to running a successful Home Performance Contractor business.

Don’t Let the Past Predict the Future

While it is impossible to predict with certainty the future of energy efficiency programs and their subsidies or financing aspects, a few things are for certain:

-          Energy efficiency programs come and go

-          Periods of relative fluctuation will alternate with periods of stability

-          Times of uncertainty will alternate with times of certainty

-          Private contractors enter and exit the efficiency industry at all times

Contractors face the real world every day marketing and prospecting to consumers winning some bids while losing others. The most important thing that Home Performance Contractors can do is to plan for the future of their businesses with an eye towards independence from utility program rebates, tax credits, and third party financing. Taking advantage of available resources is important, but determining your own destiny independent (as much as possible) from the overall microcosm your business is operating in may be even more important.

Expanding the Platform of Operation – Bundling of Products & Services – Adding to the Menu

An interesting observation I have made working with Home Performance Contractors is the difference in platforms from which individual businesses operate. Some businesses specialize in test-ins and test-outs. Other businesses specialize in insulation and air sealing jobs. Some businesses come with a background of performing general home remodeling services such as carpentry, drywall, or paint jobs. Other businesses have a strong base in HVAC services.

Comfort comes from the experience that a contractor can draw upon when delivering a product or service. If there is enough work to go around there is nothing wrong with sticking to the familiar. The problem with comfort is that it can lead to complacency. Some contractors may not have to worry. They are sufficiently strong to weather a storm. However, businesses strong in one area may have to look at adding products and services to the portfolio to be viable in the long run.

The most successful businesses I encounter in the home performance industry make sure to perform their core service  well and consistently evaluate the addition of products and services that are  easy to implement and will not compromise the focus of the business.

My Top Product Category to Consider

Electric water heaters are at the top of my list of new product categories for contractors to consider. Home Performance Contractors spent 2-4 hours in a customer’s home. It is very easy to look up the age of a water heater by writing down the manufacturer, model, and serial number because the serial number includes the date of manufacture. Each manufacturer has a different way of encoding it, but it is easy to look up via a quick and easy Google search.

My recommendation to contractors is to write up a bid for a water heater installation every time they see a water heater 10 or more years old in a customer’s home. Most plumbers are competing on price not on quality or energy efficiency because they are called in to replace a hot water heater due to failure. Home owners simply pick up the phone: “Get me hot water!”  When servicing a home with a 10+ year old water heater, a contractor can encourage the homeowner to be proactive and replace the water heater with a more efficient model prior to failure. This can allow the homeowner to work with a professional to make a more informed decision about what water heater is the best fit for their household as opposed to being stuck in a dire situation when all they are concerned about is getting their hot water back. 

Home Performance Contractors can play an important role in helping out with good water heating solutions. Contractors that don’t have water heater know-how or experience but would like to add this product category to their list of business services can do so easily.

Entry Level to Advanced Water Heating Solutions

Electric water heaters in general are easier to work with than other water heaters on the market. Consider using Rheem Marathon water heaters as an initial water heater product for your home performance business. Marathon water heaters have been around for roughly 30 years and are manufactured in Eagan, Minnesota. Marathon water heaters are super-insulated and carry a lifetime warranty against rust or corrosion. The failure rate of Marathon water heaters in the field are at less than 3%. The manufacturer stands behind its warranty making it easy for home performance contractors to quote the product and installation with confidence.

Energy Trust of Oregon sees more than 700 Marathon water heaters installed annually by contractors specializing in energy efficient solutions. The product is generally not available in big box stores or via your standard plumber in your area. Plumbers are most often interested in installing products that require a new water heater installation every 6-15years – why wouldn’t they? Marathon water heaters offer home performance contractors an opportunity to differentiate themselves from the crowd.

Home Performance Contractors should consider partnering up with a local friendly plumber that will provide the installation for a negotiated flat fee. Installation costs for an electric water heater vary by region from $300 – $600 per installation. The product cost for a 50 gallon Marathon cost roughly double of what a 12-year warranty water heater costs depending on where they buy it. Contractors in Oregon and Washington usually mark up the product and installation between 10-20%. This provides an additional $100-$300 towards the contractor’s bottom line per home performance job that uses a Marathon water heater. Stretched over the period of a year these water heater installations can pay for part of your variable or fixed costs or in the best case: can result in profit.

Besides being a trouble free, durable, long-lasting electric water heater on its own, Marathon water heaters can be used as part of a two tank solar thermal water heater installation for regular sized households. The Marathon water heater takes the role of the so called booster tank. A standard solar thermal system with a preheating tank can be installed right beside it. Home owners can finish the conversion towards going solar at any time or decide to stick with the Marathon water heater on its own.

Similarly, it is possible to set up a heat pump water heater as a preheater in combination with a Marathorn water heater as booster tank. This may be a good solution for environmentally friendly electric water heating solutions for homes with higher demands for hot water.

With this foundation of knowledge about different installations and applications for Marathon water heaters to pass on to clients, home performance contractors can feel more comfortable to go out in the field to  customers’ homes with  prepared ready-to-go  bid sheets. The bid sheet gets filled out and handed over to a potential customer if the water heater is 10 years old or older. This is the first step in the process to encourage the homeowner to be proactive and install a more energy efficient and reliable water heater before a failure can occur. 

Given the uncertainty of energy efficiency programs and tax credits, Marathon water heaters provide home performance contractors with the opportunity to expand their business with an easy to install product that also provides an assurance of high quality and durability.

Next Steps to Take When You Feel Comfortable with Water Heating

Once a contractor is familiar and comfortable with the technology, the bidding, and sales of Marathon water heaters, the foundation is laid to increase the business’s water heater portfolio by considering heat pump water heaters. Heat pump water heaters have come a long way since their introduction in the US-water heater market in 2009. The products available are much better today than what they used to be in the early 1980s.

With that said there is still the gas water heater side of things. I will leave this side of water heating to future blog posts.

Did you know that water heaters make up the second largest energy use in homes? The energy used to generate hot water can make up 15-25% of a household’s total energy use.  The choice of water heater is rather important since it can settle a home owner with low or high energy bills for years to come.

Marathon Water Heater

With an energy factor of up to 0.94EF, Rheem Marathon water heaters can provide significant energy savings. Using electricity to generate hot water is very efficient. Most Marathon water heater tanks lose less than 5% of heat per 24 hour cycle. If you live in a rural area prone to energy outages, a Marathon water heater can supply you and your family with hot water while you are waiting for the power to be restored. Marathon offers a 50 gallon tank which will allow a family to go for quite some time before running out. If you are worried about your hot water needs and would like the assurance of more capacity, you can get a larger tank to create an even bigger hot water supply buffer. Depending on your needs, Marathon water heaters also come in 15 gallon, 20 gallon, 30 gallon, 40 gallon, 75 gallon, 85 gallon, and 105 gallon tank sizes.

Another thing to consider when choosing a water heater is durability. Water heaters are often hidden in closets, basements, garages, under staircases, or in laundry rooms.  Leakages can cause damage that you may not become aware of until it is too late requiring costly repairs of flooring material, floor joists, and drywall. Marathon water heaters, manufactured in the United States of America, have a lifetime warranty against rust or corrosion, which may make a Marathon water heater the last water heater you will ever buy. The cross-linked polybutylene fibers make Marathon water heaters close to indestructible even under harsh water conditions.

Laundry room installation: Marathon water heater

Rheem Marathon water heaters are special and anything but your average electric tank you can find at a Home Depot. In addition to the many high quality features, installation of Marathon water heaters is easy and straightforward. If the time comes, you can buy a Marathon water heater at GP Conservation. The outfit is the largest factory authorized retailer of Rheem Marathon tanks in the continental USA. They will ship the water heater right to your home or business. If you need someone to do the installation for you, call a contractor that specializes in the installation of efficient water heaters.

The pictures below show an 85 gallon Marathon water heater installed in a laundry closet in a senior couple’s home in Portland, Oregon. Having gone through more than 6 water heaters during their lifetime, the couple decided to eliminate the perpetual task of swapping out water heaters once and for all and installed a Rheem Marathon water heater.

Greenhouse gases and climate change are hot topic these days. Many utilities are beginning to offer renewable energy promoting ‘green tags’ that are helping to reduce our dependence on carbon based fuels and foreign sources of energy.

Unlike every gas water heater, including those new tankless models, Marathons do not create greenhouse gases when powered by renewables such as wind, hydro, solar or nuclear.

Water heating is big load that accounts for 15-25% of residential energy consumption. This is a load that can be easily shifted to renewables, at times when renewables are available as well as efficiently storing this energy for future use.

Name another high impact appliance can make this claim! It’s ok, we’ll wait…

Thermal Storage Applications include:

• Storing hot water in traditional demand-response and load shifting programs
• Storing solar energy—both thermal and photovoltaic’s
• Storing geothermal—“Free” hot water when heat pump is in cooling mode
• Buffer and/or thermal storage tank for in-floor radiant heat
• Storing heat from a ‘waste heat’ recovery system

Marathons not only offer excellent thermal efficiency, they are built to last a Lifetime. That means they do not require replacement every 10-years like the average steel water heater. Nearly 10,000,000 water heaters are produced every year. This amount theoretically could be cut by 50% by getting more people using Marathon water heaters.

Imagine the energy savings from all the reduced manufacturing activities. Transporting/storing finished goods, fuels used in re-installation service and removal of the failed tank. Possible recycling of materials every 10-years!

The few Marathons that fail find a ‘second life’ as rain barrels, insulated residences for domestic and wild animals, fish ponds and more. Marathon’s that cannot be ‘morphed’ for another use can be finally burned as fuel. Thus possibly generating more electricity!

Make a significant reduction in greenhouse gases while saving money with an efficient Marathon water heater.

Purchasing a water heater is an important investment in your home. With a little bit of knowledge and research you can have confidence that your new water heater will provide you with many years of reliable service.

Should I invest in an electric, propane, or natural gas heater?

Electric water heaters have the greatest energy efficiency of all the fuels available on the market. What will be the cheapest cost of operation though comes down to the costs of energy in your local community and not efficiency necessarily.

However, in nearly all markets a Marathon would be the cheapest and most fiscally responsible solution compared to propane and natural gas heaters, especially with the trend of greatly fluctuating gas prices around the world. By investing in electric energy you are also gaining the safety and peace of mind from the dangers of other energy sources such as fuel leaks, carbon monoxide and even NOX fumes.

Additionally electric water heaters are cheaper to install and do not require the cumbersome and unattractive flues and channels necessary for venting the fumes from other water heaters.

How can I determine a tank’s efficiency?
Many other retailers will talk about a water heater’s first hour rating. This rating has its use in determining an element’s wattage but does not factor in any other attributes of the water heater. Because of this many high-end models will have roughly the same rating as cheaper and less efficient water heaters.

The best way to evaluate efficiency is with the Energy Factor (EF). The EF is a required assessment which all water heaters must undergo that simulates real-world conditions. This assesment will take into account factors such as element usage, insulation and standby loss. Marathon water heaters offer the greatest EF rating in every category of any tank available.

What this means is that only the water you use is being heated. Energy is not being wasted and heat is not being radiated while in standby.

What should I watch for in selecting a warranty?
What you should first observe is the warranty’s length. The U.S. Department of Energy claims that the typical lifetime for a steel water heater is no greater than ten years. While your previous steel heater may have survived fifteen to twenty years, your next steel heater probably will not.

Because manufacturers have found ways to cut production costs over the years. Due to this newer units have less steel and porcelain than past models thus they will likely not last long past their warranty.

Having to replace your water heater frequently can become very costly. Labor costs to have a qualified plumber install your heater can add up very quickly. Faulty heaters can cause a lot of damage if a leak goes unnoticed – a potential danger which will increase if you frequently invest in low quality water heaters.

The second biggest concern for buyers is the warranty exclusions. Many companies construct what appear to be great warranties but sidestep responsibility by having the most common causes of failures void the warranty. Some of these exclusions include laying the heater on its side during shipping, hard water, etc. 

What Marathon offers its residential consumers is a lifetime “no-leak” warranty. Marathon does not include an abundance of exclusory legal practices. If under normal conditions your tank begins to leak you’ll be provided with another – no strings attached.

What else should I consider when looking for a tank?
Purchasers should not just take into account the tank. Everything included with the water heater (or more commonly, not included) should be considered. Marathon saves its consumers time and money by providing the necessary components that other retailers will withhold as “accessories.”

Marathon water heaters come with a factory-installed temperature and pressure relief valve, a vacuum relief valve, four feet of pipe insulation and union fittings for every connection. All of our components are of the highest quality – the drain valves and fittings included are all brass. Many other manufacturers use poor plastic components that are not as durable.

Our products were also made with you in mind – the tank’s concave bottom allows for easier sediment removal and draining while diminishing sediment accumulation in the process. Features like these keep Marathon running a step ahead of the rest.

How large of a water heater do I require?
A combination of factors goes into determining the size of the heater required. The number of members you have in your household as well as large hot water expenditures such as whirlpools or Jacuzzis all add to the size necessary to make supply match the demand.

If you have a greater number of bedrooms than household members it still may be a good idea to purchase a larger heater as this could help your home’s resale value and will prove useful if your family does expand.

If you invest in Marathon you are not getting a typical water heater, you are getting one that will last a lifetime.