lets assume a 300 buck a year operating cost and it sounds like you
might save 4% on a more efficent model.

Here's all the math.

Energy costs are based on this document:
http://www.pge.com/tariffs/pdf/G-1.pdf

Equations & assumptions came from this document:
http://tinyurl.com/38eh4d

http://www.gamanet.org/gama/inforesources.nsf/vAttachmentLaunch/C2AAFB8D41D003F485256E9000607F66/$FILE/12-07-gas-rwh.pdf

PROCEDU
0. Calculate minimum legal efficiency (EF)
1. Calculate maximum peak-hour requirements (FHR)
2. Calculate total installed price ($/installation)
3. Calculate yearly operating costs ($/year)
4. Calculate payback period (months/installation)

CALCULATIONS:
0. Calculate the minimum energy factor required by federal & local law:
(based on October 1990 Dept. of Energy Test Procedure for Water Heaters as
published in the May 11, 1998 Federal Register.)
For gas-fired residential water heaters, the minimum energy factor is:
Minimum EF for 40-gallon water heaters = 0.67 - 0.0019 * 40 = 0.58
Minimum EF for 50-gallon water heaters = 0.67 - 0.0019 * 50 = 0.59

Note: Southern California uses different legal minimum numbers than
northern California so be advised to modify the calculation for your area!

1. Determine your peak requirements:
20 gallons per shower x 2 showers in one hour = 40 gallons per hour
20 gallons per bath x 0 baths in one hour = 0 gallons per hour
2 gallons per shave x 0 shaves in that hour = 0 additional gallons
4 gallons per personal wash x 0 = 0 additional gallons
4 gallons per shampoo x 0 = 0 additional gallons (do it in the shower)
4 gallons per hand dishwashing x 0 dishes = 0 gallons
14 gallons per dishwasher load x 1 load = 14 additional peak gallons
5 gallons per food preparation x 1 meal = 5 additional gallons
26 gallons per wringer wash x 1 load = 26 additional peak gallons
32 gallons per automatic wash x 0 loads = 0 additional peak gallons
-----
TOTAL PEAK GALLONS = 40 + 14 + 5 + 26 = 85 gallons First Hour Rating

2. Determine price installed (inclusive):
Sears 33154 is $882 ($449 for the heater + $433 for full installation)
HD 183-717 is $747 ($349 for the heater + $398 for full installation)

3. Determine yearly operating costs given your basal energy unit, FHR, EF,
and average-use assumption.

CHOICE A:
Sears 33154 (marketed as Kenmore but made by AO Smith) FHR=97 EF=0.63
(41,045 btu/0.63)($1.21106/therm * 1 therm/100,000 btu) x 365 = $288/year

CHOICE B:
Home Depot 183-717 (marketed as GE but made by Rheem) FHR=80 EF=0.58
(41,045 btu/0.58)($1.21106/therm * 1 therm/100,000 btu) x 365 = $313/year

Note: Irrelevant specs would have been tank size, burner BTUs, gallons to
recovery to 90 degrees in one hour, etc. as the only figures that matter
for the calculations are the EF and the FHR since they take into account
all other design-size specifications.)

4. Determine payback period:
a. Additional cost of more efficient model = $882 - $747 = $135
b. Annual savings of more efficient model = $313 - $288 = $25 per year
c. Payback period = $135 / $25 * 365 / 30 = 65 months (5.4 years)

5. Determine overall savings:
The two water heaters compared in this simplified calcuation would be
equivalent in overall costs at approximately 5 and a half years.

Considering the average water heater lasts 13 years, total savings for the
more expensive yet more economical heater would be:

(13 years - 5.4 years) * $25/year = $190 savings overall for the initially
more expensive Sears unit.