The four ways to cut your water-heating bill are to: Use less hot water, turn down the thermostat on your water heater and appliances that use hot water, insulate your water heater, or buy a new, more efficient, water heater and other appliances that use hot water. Lowering the thermostat on your water heater to a setting of 115 o F should provide comfortable hot water for most uses.

Reduce the Flow--Use Low-Flow Showerheads & Aerator Faucets: If you don't have them already, low-flow showerheads and faucets can drastically cut your hot water-heating expenses. Savings of 10-16% of water heating costs.
Well under $20 for most showerheads, a little more for faucets.

Ahhh, a Hot Water Wrap: Wrap your hot water tank with jacket insulation: This is especially valuable for older water heaters with little internal insulation. Be sure to leave the air intake vent uncovered when insulating a gas water heater. Savings up to 10% on water-heating costs.
Less than $20

Energy Star Dishwasher: 80% of the energy used for dishwashing is for water heating. An Energy Star dishwasher can save up to 20% on water- heating costs. Use the air-dry setting or turn the dishwasher off after its final rinse and open the door. Click here for qualifying models.
$200 to $500
Rebate: $50

Solar Water Heater: If you have an unshaded, south-facing location (such as the roof) on your property, you should consider having your water heated by incident sunlight. For information, see our Renewables section.
$200 to $5000

Energy-Star Clothes Washer: A front-loading, Energy Star clothes washer uses up to 50% less energy than a standard washer. Switching your temperature setting from hot to warm can cut a load's energy use in half. And remember, your spin cycle uses large amounts of energy; so, skip the second rinse unless you really need it.
$500 to $1500
Rebate: $75 from Utility; $125 for Water District Voucher (see below)
NOTE: If you're looking to qualify for both incentives, you will have to purchase a model that is approved by both the utility and the water district.

In addition to rebates from the utility, the Carlsbad Municipal Water District, City of Del Mar, City of Escondido, Helix Water District, City of Oceanside, City of San Diego, Olivenhain Municipal Water District, Otay Water District, Padre Dam Municipal Water District, City of Poway, Ramona Municipal Water District, Rincon Del Diablo Municipal Water District, San Dieguito Water District, Santa Fe Irrigation District, Sweetwater Authority, Vallecitos Water District, Valley Center Municipal Water District, and Vista Irrigation District offer a $125 applicable voucher on approved clothes washer models. Call 800-986-4538 or click here for more information.

High-Efficiency Gas Water Heater: An efficient gas water heater can help you save up to $35 per year. Lowering the thermostat on your water heater to a setting of 1150 F should provide comfortable hot water for most uses. View qualifying models here.
$200 to $500
Rebate: $30

Pools & Spas: Pumps and motors that keep pools and spas operating should be upgraded to more efficient models that use half the horsepower. You can also receive a credit if you switch to filtering during off-peak hours, outside of 12 pm to 6pm.
$400 to $500
Rebates: $30 or $250 per unit.

And while you're at it, consider installing a low-flow toilet. It won't save you money on your water heating bill, but will decrease your monthly water bill! Click here for more info from the San Diego County Water Authority.