If the element is immersed in the water, and not wrapped around the heater, and if it burned out internally, which is seldom the case, then there are no problems, but it should also have no effect on your electric bil. If it burned out and ruptured, thw most common situation, then the electricity in the element is in contact with the water in the tank. In this case the efects can range from slight to serious. Since you are not getting excessively hot water, then the element has not bypassed the thermostat. But you could be using electricy into the water without heating it. Also, your water system could be energized with a low level electric current. Unless the element has leaked and rusted the element into place, replacing it is a simple matter. Again, the above assumes that it is an immersed element.: I have reduced hot water; lower element is not working; landlord refuses to replace it, insisting there is no ill effect from it; water heater is over 40 years old. My electric bill is much higher; what is effect of bad element? Any additional risks to be considered?