A Water Heater Blanket is an insulation blanket that is wrapped around a water heater to help prevent standby heat loss from the tank of the water heater. Water Heater Blankets are often constructed from fiberglass insulation and have a plastic layer on the outside. The blankets are wrapped around the water heater and tape is used to seal the seams and edges.
When installing a Water Heater Blanket the water heater manufacturers instruct installers to not cover any access covers for servicing, signage pertaining to safe operation of the water heater, air inlets and access covers for burners, and to keep it away from the flue where it may be ignited.
Water Heater Blankets may be of little value on modern well insulated water heaters with an R-10 blanket installed on a modern high efficiency EF 0.93 electric water heater yielding an annual savings of only 96 kWh. On older water heaters that were produced before 1987 a Water Heater Blanket could yield an annual savings of 809 kWh. On gas fired water heaters the primary heat loss is through the flue which extends up through the center of the water heater which the Water Heater Blanket can not do anything about. Power venting, direct venting and flue dampers can prevent the flue losses and many of the newer gas water heater installations use these methods to increase efficiencies by lowering the losses in the flue on gas water heaters.