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An analytical study is carried out to assess the impact of corrections to nominal test conditions on the measured energy factor for residential water heaters. While test conditions are specified in the method of test, the difficulty in exactly achieving these test conditions in the laboratory necessitates a computational approach to correct the results to nominal conditions. This paper examines the magnitude of those corrections for a range of water heaters of various fuel type, heating method, and size across a number of potential draw volumes during a 24-hour simulated use test. In making these corrections, a recovery efficiency and a standby heat loss coefficient are determined during the test; the effects of variations in those measured values on the resultant energy factor are discussed. Finally, the impact of tighter test tolerances on the variability of the energy factor is investigated to assist in evaluating the benefits of changing test conditions.