How Much Do Hybrid Heat Pump Water Heaters Cost – And How Much Can You Save?
Hot water heaters account for approximately 20% of an average home’s energy costs, so installing a hybrid heat pump hot water heater in your home can lead to substantial savings over time. Hybrid hot water heaters are about 3.5 times more efficient than traditional hot water heaters, and the U.S. government estimates that a family of four will save approximately $350 a year on electric bills compared to a traditional electric hot water heater. Over time, these savings from a hybrid heat pump hot water heater will more than offset the near-term costs of buying and installing one. But for a homeowner, it’s good to have an idea of the up-front costs to determine if they fit into your budget.
Here’s what we’ll cover in this guide – feel free to jump to the section you’re interested in.
- How Much Does it Cost to Buy a Hybrid Heat Pump Water Heater?
- How Much Does it Cost to Run a Hybrid Heat Pump Water Heater?
- Do Hybrid Heat Pump Water Heaters Save Money?
- Savings Calculator for Hybrid Heat Pump Water Heater
- Installation Costs for a Hybrid Heat Pump Water Heater
- Are Hybrid Heat Pump Water Heaters Worth It?
- Tax Credit for Hybrid Heat Pump Water Heater
- Rebates for Hybrid Heat Pump Water Heater
- Warranty for Hybrid Heat Pump Water Heater
How Much Does it Cost to Buy a Hybrid Heat Pump Water Heater?
So how much is a heat pump water heater? As with any major home purchase, there’s a wide variation in prices between different models, ranging anywhere from slightly over $1,000 for basic models, to larger or more feature-rich units costing closer to $3,000. Price alone does not tell the whole story: rebates from the manufacturer or the government (more on these below) and even the time of year can save you money (fall and winter, when contractors are less busy, tend to see lower prices on installation).
How Much Does it Cost to Run a Hybrid Heat Pump Water Heater?
Hybrid heat pump water heaters use less power than conventional hot water heaters; far less, in most cases. Since hybrid hot water heaters are about three times more efficient than conventional electric models, if your conventional hot water heater costs $35 a month to run, a hybrid model will only cost about $9.50 a month.
Do Hybrid Heat Pump Water Heaters Save Money?
Hybrid heat pump hot water heaters save money over standard gas or electric models thanks to something called their “Energy Factor” (EF). EF measures the percentage of energy the heater is able to turn into hot water: the higher the number, the more efficient the hot water heater. Electric tank heaters have an EF of around 0.95, while gas and oil tank heaters’ EF is around 0.6. A hybrid hot water heat, by contrast, has an EF of 3.5 – using much less energy and saving you money.
Savings Calculator for Hybrid Heat Pump Water Heater
How much you can save with a hybrid heat pump water heater is dependent on multiple factors, including your energy use, how many gallons of hot water per day you need, how hot you want your water to be, and the price you pay to run your current hot water heater. For a personalized estimate, use this calculator from Efficiency Maine: Calculator
Installation Costs for a Hybrid Heat Pump Water Heater
Installing a new hybrid heat pump water heater may require changes to your home’s water, electric, and/or gas systems – so your best bet is to hire a licensed contractor. The great news is that the savings from your new hybrid water heater will usually pay for purchase and installation costs in about five years. For more information see our guide on the installation process: “How to Install Hybrid Heat Pump Water Heater”
Are Hybrid Heat Pump Water Heaters Worth It?
Replacing your water heater is not a small job, but since conventional heaters only last eight to ten years, it’s something most homeowners will face – probably sooner than later. A hybrid heat pump water heater can take a lot of the sting out of this process: their high efficiency means that your energy savings begin from the first day they are connected – and let these heaters pay for themselves over time. They are environmentally friendly and can help cool your home while heating your water. And finally, they are more reliable than standard heaters – so their lifespans can be longer. For more details see “What is a Hybrid Heat Pump Water Heater”
Tax Credit for Hybrid Heat Pump Water Heater
The federal government knows that hybrid water heaters are good for people and good for the environment, so it offers a tax credit (as of 2021) to homeowners who install a high-efficiency water heater. Qualifying homeowners can get a $300 federal tax credit by filing the appropriate paperwork with their tax returns. You can learn more here: Equipment Tax Credits for Primary Residences
Rebates for Hybrid Heat Pump Water Heater
Federal tax credits are just the tip of the iceberg when it comes to hybrid heat pump hot water heater incentives. Rebates from manufacturers, utility companies, and state agencies can offer three times as much money back – or more – and they can be claimed even if you are also claiming the tax credit. A couple of these programs are from Rheem and Energy Star Rebate Finder. Find rebates and special offers near you by entering your zip code here.
Warranty for Hybrid Heat Pump Water Heater
Hybrid heat pump water heaters have better reliability ratings than many of their conventional predecessors. Not surprisingly, they have strong warranties. Learn more about the Rheem hybrid water heater warranty here.
Contractors for Hybrid Heat Pump Hot Water Heater Installation
Finding the right contractor can be the key to having a hybrid heat pump water heater installed correctly and safely, and is certainly easier than doing it yourself. Beyond word-of-mouth recommendations, local building inspectors or trade groups may have a list of licensed contractors in your area.