The thermostat settings that lower your energy bill most are setbacks: turn the heat down 7°F to 10°F for 8 hours a day in fall and winter, which the U.S. Department of Energy says can save as much as 10% a year on heating and cooling. Pair that with a water heater set to 120°F, a clean furnace filter and a yearly tune-up. If you have a heat pump, use a thermostat made for heat pumps before you try setbacks.
Heating, cooling and hot water are the biggest energy users in most homes. The U.S. Department of Energy (DOE) says space heating and air conditioning together typically make up about 32% of home energy use, and water heating about 18%. That means the right lower energy bill thermostat settings, plus a few water heater and furnace tweaks, can move your bill more than almost anything else you do.
This guide covers what to set, what to clean and what to leave alone. Every number here comes from DOE or ENERGY STAR.
What thermostat settings lower your energy bill?
The biggest win is a setback: letting the house be cooler while you sleep or are away in winter, and warmer when you are away in summer. DOE says you can save as much as 10% per year on heating and cooling by turning your thermostat down 7°F to 10°F for 8 hours a day in fall and winter.
Here is how to use that in practice:
| Season | When you are home and awake | When asleep or away | Source |
|---|---|---|---|
| Fall and winter | As low as is comfortable | 7°F to 10°F lower for about 8 hours | DOE |
| Spring and summer | As high as is comfortable | Raise it while you sleep or are away | DOE |
DOE does not give one “best” number, because comfort varies. Start with a setting you can live with, then add the setback. DOE also reminds you to keep pets’ comfort and safety in mind in summer.
Use the fan setting and ceiling fans
Two small settings help too:
- Thermostat fan on “Auto.” DOE says to keep it on Auto unless an indoor air quality pro has set your system to run the fan nonstop for health reasons.
- Ceiling fans in summer. DOE says a ceiling fan lets you raise the thermostat about 4°F with no loss in comfort. DOE says fans cool by creating a wind chill effect, so turn them off when you leave the room.
- Ceiling fans in winter. DOE says to reverse the fan to run clockwise to push warm air down from the ceiling.
Is a smart or programmable thermostat worth it?
Yes, if it means your setbacks actually happen every day. A programmable thermostat runs the schedule you set. A smart thermostat can learn your schedule, let you adjust it from your phone and show your energy use, according to DOE.
ENERGY STAR says homes with high heating and cooling bills, or homes that sit empty much of the day, can save about $100 a year with an ENERGY STAR certified smart thermostat. ENERGY STAR certifies these models based on real-world field data.
Before you buy, ENERGY STAR says to confirm the thermostat works with your heating and cooling system. For very high-efficiency equipment, a controller from the equipment maker may be a better fit.
Set your schedule around real life. A setback only saves money if it runs on the days and hours you are actually asleep or away, so review the schedule when your routine changes.
Should you set back a heat pump thermostat?
Only with the right thermostat. DOE says not to set back a heat pump manually if it causes the backup electric-resistance heat to come on, because that heat costs more to run.
DOE recommends installing, or having a pro install, a smart or programmable thermostat with functions suitable for a heat pump. If your thermostat shows “aux” or “emergency” heat often after a setback, read our guide to what ecobee aux heat means, since the same idea applies to most brands.
What furnace habits lower your heating bill?
A clean, well-tuned furnace burns less fuel for the same heat. These habits come straight from DOE and ENERGY STAR.
- Check the filter monthly. ENERGY STAR says to check it every month and change it at least every 3 months. DOE says regular filter changes keep the system running efficiently.
- Keep registers clear. DOE says to make sure warm-air registers and baseboard heaters are not blocked by furniture, carpets or drapes.
- Get a yearly tune-up. ENERGY STAR compares it to a car tune-up for efficiency and comfort. The pro should check gas connections, gas pressure, burner combustion and the heat exchanger.
- Use the sun. DOE says to open south-facing curtains on winter days and close them at night.
- Fix the ducts. ENERGY STAR says sealing and insulating ducts can improve system efficiency by as much as 20 percent.
A clogged filter does more than waste fuel. Poor airflow can make the furnace overheat and shut down, which shows up as limit codes such as Carrier furnace code 33.
When is it time to replace the furnace?
ENERGY STAR says heating and cooling equipment more than 10 years old should be checked by a professional. It also says replacing old equipment with ENERGY STAR certified models can cut your annual energy bill by nearly $140, depending on where you live. Ask for a model with a high AFUE rating, which DOE describes as the measure of heating efficiency for furnaces and boilers.
What water heater settings save money?
Set the tank to 120°F. DOE recommends 120°F as a temperature considered safe for most of the population, and turning down the water heater thermostat is one of DOE’s four main ways to cut water heating bills.
The other three are using less hot water, insulating the heater and pipes, and buying a more efficient model. Here is what each step can save, according to DOE:
| Step | DOE savings figure |
|---|---|
| Insulate a tank that is warm to the touch | 7% to 16% a year on water heating costs |
| Insulate hot water pipes | An additional 3% to 4% a year |
| Insulate under an electric tank | Another 4% to 9% of water heating energy |
| Drain a quart every 3 months | Removes sediment that lowers efficiency |
| Install heat traps on the pipes | Prevents heat loss (most new heaters have them built in) |
DOE says to follow the manufacturer’s recommendations for any tank insulation and draining. Check your water heater manual before you wrap the tank.
Is a heat pump water heater worth it?
If your tank is getting old, it may be. ENERGY STAR says a certified heat pump water heater can save a household of four more than $330 per year on electric bills compared with a standard electric water heater. DOE says most storage water heaters last 10 to 15 years, and ENERGY STAR suggests planning a replacement before an older unit fails.
If your tankless or tank heater is showing a code instead of a temperature, start with our Rheem water heater error codes list.
⚠️ Safety first
- If you smell gas, leave the home and call your gas utility or 911 from outside. Do not operate switches.
- Turn off power at the breaker before touching an electric water heater thermostat. Disconnect power at the breaker before removing panels.
- On gas furnaces and water heaters, leave burner, gas valve and gas pressure work to a licensed technician, as ENERGY STAR’s checklist lists them as pro tasks.
- The USFA says to keep anything that can burn at least 3 feet from all heat sources, and never use an oven to heat your home.
What else lowers your heating and cooling bill?
Settings work best in a tight house. DOE says ducts that leak into an attic or crawl space can add hundreds of dollars a year to heating and cooling bills. It also says combining a new system with insulation, air sealing and good thermostat settings can cut heating and cooling bills by about 30%.
Simple, low-cost steps:
- Seal duct joints in unconditioned spaces, or have a pro do it.
- Keep summer window coverings closed during the day, as DOE advises.
- Turn kitchen and bath exhaust fans off within 20 minutes after cooking or bathing, unless they are designed to run all the time.
Frequently asked questions
What is the best thermostat setting to save money in winter?
DOE does not name one temperature. It says to set the thermostat as low as is comfortable, then turn it down 7°F to 10°F for 8 hours a day, such as while you sleep. That setback can save as much as 10% a year on heating and cooling.
Does turning the heat down at night really save energy?
Yes, according to DOE, which says a nightly setback of 7°F to 10°F for 8 hours can save as much as 10% per year. The exception is a heat pump without a heat-pump-ready thermostat. If the setback triggers backup electric heat, DOE says not to do it manually.
What temperature should I set my water heater to?
DOE recommends 120°F, which it calls safe for most of the population. If your dishwasher heats its own water, DOE says 120°F is usually fine, but check the dishwasher manual first.
How much can a smart thermostat save?
ENERGY STAR says about $100 a year for homes with high heating and cooling bills or homes that are empty much of the day. Savings depend on your climate, your system and how you set it up.
