Are heat pump water heaters worth it?
Pump heater costs vs. savings
Your water heater is one of the most inefficient appliances in your home — electric water heaters account for an average of 18% of your electricity costs, according to the Department of Energy (DOE). Generally, the older your water heater, the less energy-efficient it is.
A heat pump water heater is a more efficient option. As Sarah Widder, formerly of the DOE’s Pacific Northwest National Laboratory, explained, these pump water heaters can use up to 63% less energy than traditional electric water heaters.
Key insights
- A household of four people can save approximately $330 per year on electric bills by using a heat pump water heater.
- Heat pump water heaters generally last around 13 to 15 years, while conventional electric water heaters tend to last about eight to 12 years.
- Heat pump water heaters provide long-term cost savings, but they come with a higher upfront cost than traditional electric water heaters.
- Overall, heat pump water heaters offer improved energy efficiency, long-term cost savings and a longer life spans when compared with traditional electric water heaters.
How does a heat pump water heater work?
Heat pump water heaters use electricity to move heat from one place to another (rather than generating their own heat like traditional electric water heaters). This makes them two to three times more efficient, according to the Department of Energy (DOE).
You can think of a heat pump water heater as a refrigerator working in reverse: A refrigerator pulls heat from inside a box and dumps it out; an electric pump water heater pulls heat from the surrounding air and dumps it, at a higher temperature, into a tank to heat water.
You might hear heat pump water heaters referred to as “hybrid” water heaters — they can actually switch to electric power as needed.
Heat pump water heaters are sometimes called “hybrid” water heaters because, during periods of high hot water use, they can switch to standard electric resistance heat automatically. You can use your unit’s control panel to set the water heater to various settings, including hybrid mode. If you don’t want it to switch over automatically, simply set it to the regular heat pump mode.
Many control panels have multiple settings and modes to maximize energy savings. If both of your kids are showering at the same time in different bathrooms while you’re running the dishwasher, for instance, you can switch it to “high-demand” or “hybrid” mode to get adequate hot water. Hybrid mode is the most energy-efficient mode for daily use.
These water heaters can also save you money — a reviewer from Canada on our site said about their heat pump water heater: “Have been running it on heat pump only mode for two weeks now and have experienced consistent hot water. Just fantastic and our natural gas bill has dropped significantly.”
How much will a heat pump water heater save you?
A heat pump water heater can save a household of four people around $330 a year on electric bills, according to the Environmental Protection Agency. That adds up to a savings of around $4,000 to $5,000 over the life of a typical heat pump water heater. The larger your family, the quicker you’ll see a return on investment.
If every household in the U.S. used a heat pump water heater (under 55 gallons), the energy cost savings would top $8.2 billion dollars a year, the EPA calculated.
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Heat pump water heaters also have a longer life span (around 13 to 15 years) than conventional electric water heaters (around eight to 12 years).
How much will a heat pump water heater cost you?
Like most things that operate more efficiently and save you money, a heat pump water heater costs quite a bit more than a traditional electric water heater. As of publishing, at Lowe’s, a 50-gallon heat pump water heater goes for around $1,950, while the older, conventional electric water heater is closer to $560.
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A comparable heat pump water heater may cost three times or more what an electric water heater costs, but it can also save you hundreds per year.
It’s recommended to have a professional install your heat pump water heater to maximize its energy efficiency (installation might cost anywhere from $150 to $800 more). When choosing a qualified professional to install your water heater, remember to:
- Request estimates in writing
- Ask for references
- Check for complaints with your state’s attorney general or the Better Business Bureau
- Make sure the installer knows about local building codes and permitting
In the end, your savings should offset the initial cost of a heat pump water heater due to lower electricity bills.
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