Once space heating and cooling has been addressed, water heating methods –  the second  largest opportunity for efficiency improvement – must be considered. To optimize energy efficiency in a zero energy home, builders and designers should look at the type and location of water heating system they install as well as strategies for minimizing the use of hot water by residents. Water heater efficiency is expressed by energy factor (EF), which is essentially the percentage of fuel converted to useful heat. EF is expressed as a decimal, where .90 EF is 90% efficient. Selecting the right type of water heater depends on the amount of hot water to be used, the climate, and the building design.