Climate action

Replace your water heater with an electric heat pump water heater

Mimi Tran Zambetti

Oct 8, 2021 • 3 min read

Most homes have a gas water heater — if yours does, chances are that the water heater is the one of the highest sources of energy usage in your home, second only to heating & cooling. Replacing a 10+ year old water heater with a new one can save money on your energy bills, and is critical in decreasing reliance on fossil fuels.

In fact, the EPA estimates that if all heat pumps, central air conditioners and electric water heaters sold in the U.S. met the new Energy Star standards, we would avoid 113 million tonnes of greenhouse gases per year. That's about 13% of all U.S. residential emissions in 2020.

So in this guide, we're spotlighting the most wallet-and-environmentally-friendly technology: the hybrid electric water heater.

Why hybrid electric water heaters over gas or regular electric water heaters?

A hybrid water heater, also known as a heat pump water heater, combines heat pump technology with electric water heaters — the name isn't a reference to a combination of natural gas and electricity as energy sources.

This system draws in warmth from the surrounding air to heat your water, instead of burning gas or using electricity to heat the water directly. Thanks to this, it uses 60% less energy than other electric water heater technologies. That said, for optimal performance they need to be placed in a room that stays above 40°F year round.

A heat pump water heater can save your household of four people around $330 a year on your electric bill, according to the government website Energy Star. That adds up to a savings of around $3,400 over the lifetime of a typical heat pump water heater.

Top Pick

Rheem ProTerra 50 Gallon Hybrid

Most hybrid water heater models perform very similarly, and the main differences will show in upfront cost. That's why our top pick is the Rheem ProTerra (sometimes sold under Ruud, though they are the same brand) — it has one of the lower retail prices (about $1400-$1700 depending on sales), and the lowest yearly energy cost, at just $104!

It also comes in many tank sizes ranging between 40 to 80 gallons, which can be helpful to size your water heater perfectly to your household's needs.

Depending on where you live, you might qualify for a $300 federal government tax credit!

How to compare models

If you're browsing your local home improvement store, you might notice that most appliances now come with an energy guide label. For water heaters, the energy guide will detail the average annual energy cost & how much water you get out of the unit in the first hour of operation (the higher the better).

Another metric you might see on water heaters is UEF, or Uniform Energy Factor. UEF is like an exchange rate: Water heaters with high UEF ratings will yield a higher return of hot water on every dollar of energy you put in. In general, ENERGY STAR certified conventional gas and electric water heaters have UEF ratings between 0.65 and 0.95 — or 65 to 95 cents on the dollar — while hybrid electric heat pump water heaters have much higher UEF ratings of 2.75 to 3.5.

See more about how Energy Star uses UEF to evaluate appliances.