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Hot water
Heating cold water is very energy intensive - and also a great place to save energy. By reducing your hot water usage, you reduce the amount of energy you consume which plays an important role in helping reduce greenhouse gases.
Temperature
Turn it down. Turn your water heater down to 54°C. (1) This will save you money and keep you from burning your hands. If your heater doesn't have a temperature gauge, run a meat thermometer under the hot water for a reading.
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Sediment
Drain it. Experts recommend draining a pint or so of water from your water heater a few times a year to reduce sediment and increase efficiency.
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Insulation
Add insulation. As long as you're dealing with your water heater, you might as well add some insulation. Since the standard hot water heater is on all the time, adding extra insulation will save more energy than you think. Most hardware stores sell pre-made insulator "jackets" that can be easily wrapped around your water heater.
Experts estimate that adding insulation to your water heater and any exposed pipes can knock up to 15% off the costs of heating water. (2) Caution: Be sure to read the manufacturer's instructions before taking this step.
