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Co-op halts large-capacity water heater sales

One of Lorain-Medina Rural Electric Cooperative's most popular, long-standing and successful load-management programs has taken a broadside hit from the U.S. Department of Energy (DOE).

Electric resistance water heaters greater than 55 gallons cannot meet the Department of Energy's new energy efficiency standards that go into effect in April 2015. Effective immediately, the cooperative will no longer sell large-capacity water heaters.

For the past 20-plus years, the water heater load-management program has been successful and popular with LMRE members. The water heater is equipped with a "load control" switch and is used during summer and winter peak demand periods to cycle the unit on and off, which decreases energy use when electricity is most expensive to purchase.

Members benefited immediately by receiving incentives for installing the switch on their water heater. But over time, all members across the entire LMRE system benefited because reduced peak demand helps hold down energy costs.

But this adventurous program will no longer make sense under the new DOE regulation. The Department of Energy wants the market to move toward heat pump water heaters.

Since 1999, the cooperative has sold and installed 50-, 75-, 85- and 105-gallon lifetime-warrantied Marathon® water heaters to its members. The cooperative preferred the large-capacity, well-insulated, energy-efficient water heaters to maintain adequate hot water during the occasional load control periods that could extend up to six to eight hours.

The Marathon tank is manufactured by Rheem, which recently joined other manufacturers in announcing they will discontinue the production of their large-capacity water heaters in the spring of 2015.

The cooperative will continue to sell and install the 50-gallon Marathon water heaters, plus the 75-gallon tank while supplies last. It also will continue to see the 85- to 105-gallon tank to those members installing geothermal systems while supplies last. The cooperative is increasing its inventory of the large water heaters for warranty purposes.

In March 2013, LMRE General Manager Markus Bryant testified against these regulations before the Department of Energy on behalf of the Ohio electric cooperatives.

"The heat pump water heater may be more energy efficient, but the life expectancy is not there, making it a poor investment," Bryant said at the LMRE Board of Trustees' October meeting. "It's a case of crony capitalism gone wrong. The biggest beneficiary of this new rule is GE Corporation, who has invested heavily in heat pump water heaters. The Department of Energy is forcing the public to buy a product they do not want and can't afford. That's my take on it."

Bryant said the revised water heater program should be considered temporary. Working with their statewide and national organizations, cooperatives are working with federal legislators to find a long-term solution. "It may take three to six months, but we're going to continue to fight this new rule."

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