Some of the heat in hot water is lost between the central hot water heater and the faucet. You can reduce this waste by improving your hot water distribution system. For existing homes, common distribution system energy savings measures include installing low flow shower heads, fixing leaks, and adding insulation to pipes. If you are building a new house, the way the pipes are routed, and the location of faucets, can save a lot of energy. See EPA’s WaterSense for New Homes program for more information: www.epa.gov/watersense/new_homes/index.html
Point of Use (POU) water heaters can also help reduce heat lost in the how water distribution system. The term “point of use” is applied because water is heated very near the sink, shower or bath where the water is used, instead of a central heater. POUs are often used to boost the temperature of water at a fixture that is a long way from a central water heater. Adding a POU at the fixture may be the best option in terms of system-wide energy efficiency, especially compared to the alternative of increasing the temperature setting of a storage water heater. A POU may also be an energy efficient choice to heat water for a hot tub. However, POUs are not suitable back-ups for solar water heaters or geothermal heat pumps, as they will not be able to support the full hot water demand of a household when the solar or geothermal units are not opperating.
When to consider POU heaters:
In any of these cases, costs and benefits should be carefully assessed before going with a decentralized water heating approach. In general applications matching one or more of the qualities listed below are more likely to save energy and money with a decentralized water heating system.