Dishwashers, washing machines, taps and showers could soon all have new water efficiency labels.
The government has launched a consultation on the measure that is predicted to save consumers more than £270 million on bills over ten years.
According to Defra analysis, the new labelling system could save £125 million on water bills and £147 million on energy bills.
It could also save around 1,200 million litres of water a day, the equivalent of 480 Olympic swimming pools.
Under the new government plans, the new separate water label from the existing energy label will be introduced for toilets, urinals, kitchen sink taps and other appliances.
Water Minister Steve Double said: “Water is a precious resource. We want to support consumers so they can make savings without having to make significant changes to their daily lives.
“These plans will help people to make the right choices to save water and reduce their energy bills.”
David Black, Ofwat Chief Executive Officer, said: “This summer has highlighted the importance of water. Water labelling is a key tool, helping everybody make informed choices that can reduce their water use and bills.”