a closeup of the heat pump water heater unit on top of the hybrid water heater tank with a green graphic indicating efficiency and money savings

In the past decade, heat pump water heaters, also known as hybrid water heaters, have been gaining popularity as a more energy-efficient alternative to conventional storage water heaters. HPWHs can save homeowners hundreds of dollars each year on their energy bills. 

So, why are heat pump water heaters so much more efficient?

This article will explain how heat pump water heaters work and why they are much more efficient. So, let’s get into it!

Why Are Heat Pump Water Heaters So Much More Efficient?

Heat pump water heaters (HPWHs) are energy-efficient because instead of heating the water up with coils like a conventional water heater, they use a small amount of electricity to transfer heat from the surrounding air into the water using the heat pump unit sitting on top of the tank.

Are HPWHs More Efficient Than Gas?

Heat pump water heaters are more efficient than gas. The US Department of Energy states they can be up to three times more efficient than gas water heaters. Heat pump water heaters use the heat in the surrounding air to heat water, while gas water heaters generate their own heat.

Here are several reasons why heat pump water heaters are more efficient than gas heaters:

  • Electric HPWHs don’t use any fossil fuels to generate heat
  • Gas water heaters must generate heat constantly, resulting in higher energy consumption
  • Transferring heat from the air is a more efficient process than generating heat
  • The compressor in an HPWH can transfer more heat than a combustion process in a gas water heater

The Environmental Protection Agency (EPA) reports that HPWHs can have emissions levels 100 times lower than gas-fired units.

Why Are HPWHs More Efficient Than Traditional Water Heaters?

There are two main types of electric water heaters—traditional storage tank water heaters and heat pump water heaters.

Both use electricity to operate, but HPWHs are much more efficient, eco-friendly, and safer than traditional electric water heaters. 

Here’s why:

  • HPWHs use refrigerant to transfer heat from the surrounding air to the water in the tank. This feature makes it more economical than using coils for energy generation, which is how classic water heaters work.
  • HPWHs have a much higher efficiency rating than traditional electric water heaters. While most conventional electric water heaters have an efficiency rating of about 80%, HPWHs can have up to 200% efficiency ratings. This might not seem like a huge difference, but it translates to a much smaller electric bill. 
  • HPWHs use the heat already in the air to warm up water instead of burning fossil fuels to generate that heat. This process is much more environmentally friendly than traditional electric water heaters. 
A diagram showing the components of an electric heat pump water heater
Courtesy of the Department of Energy
  • Heat pump water heaters are available in various sizes and models to meet different needs. Some units can be installed inside the home, while others are designed for outdoor installation. They can also be used in conjunction with solar water-heating systems to increase efficiency further.
  • HPWHs don’t have the same safety issues that some traditional electric water heaters have. So while you still need to practice caution when using HPWHs, these heaters are much less likely to explode and cause injury or death. 

If you’re looking to replace your old water heater, consider purchasing an energy-efficient model, such as a heat pump water heater. The initial cost of buying an HPWH is typically higher than that of a traditional water heater, but the increased efficiency may result in significant savings over time. 

What Are the Pros And Cons of an HPWH? 

While HPWHs are more expensive than electric resistance water heaters, their increased efficiency offsets the additional cost over the long term. In addition, federal and local rebate programs are available to help reduce the net installation cost of an HPWH system.

You also can read about installation costs, along with my own story of installing heat pump water heaters in two of our netzero solar renovation homes by clicking here.

Heat Pump Water Heater Pros

  • They’re easy and convenient to use – heat pump water heaters are simple to install and require minimal maintenance. In addition, they come with various features that make them even more efficient, such as automatic temperature control and timer settings so you can set the heater to turn off when not needed. 
  • They’re much more efficient than an ERWH, especially in warm climates – heat pump water heaters use up to three times less energy than their electric counterparts. Instead of generating heat directly, HPWH uses electricity to transfer heat. This mechanism makes them highly efficient.
a blue tesla model 3 on the left with a rheem hybrid heat pump water heater on the right in a garage

Heat Pump Water Heater Cons

  • HPWHs are more expensive than ERWHs – still, you will recoup your initial investment in the long run when you consider the reduction in your energy bill. 
  • HPWHs require more space than traditional water heaters – they contain an evaporator coil and condenser coil, as well as a fan to circulate air. If you’re tight on space in your home, a heat pump water heater might not be your best option.
  • They make noise – you probably don’t want these in your living areas due to this. I made a quick video (see below), along with this other article, on the different sound levels and noises they make. Here in Florida, they are perfect to put in the garage for all the reasons mentioned above, but largely because you can’t hear the noise (yet it’s still protected indoors).

Will a Heat Pump Water Heater Work in Zero-Degree Weather?

Heat pump water heaters will work in zero-degree weather. They are designed to operate in a wide range of temperatures, from 0°F (-18°C) to 120°F (49°C). Their main advantage is that they’re energy-efficient, but not many people know that HPWHs can also be used in cold weather.

Each manufacturer can be different, so be sure to verify their specifications on the model you’re ordering before you buy.

As temperatures outside dip below freezing, you might wonder whether your heat pump water heater will still work. 

Here are a few things to keep in mind:

  • HPWHs can operate in freezing temperatures – however, when the temperature outside is freezing, the unit will have to work harder to maintain the water temperature. This means it will use more electricity and may not be as efficient as in warmer weather.
  • If you live in an area where the temperature routinely dips below freezing, consider installing a backup heating source for your heat pump water heater – this measure will ensure your unit always has enough power to keep the water warm. 

Heat pump water heaters are an excellent choice for people who live in areas with cold winters and have access to power. But when it’s cold outside, the heat pump doesn’t have to run as long because the warm indoor air temperature is already close to the ideal temperature for heating water.

How To Choose the Right HPWH Model

Choosing a suitable water heater model for your home can be daunting. There are so many different makes and models on the market. So how can you know which one is right for you? 

Here are a few tips to help you choose the best heat pump water heater:

  • Consider the size of your home – a larger home will need a bigger heat pump water heater to meet your hot water needs. 
  • Take a look at your energy usage – for example, if you use a lot of hot water, you’ll want to choose a highly efficient model.
  • Calculate your budget – heat pump water heaters can range in price, so be sure to choose one that fits your budget.

By following these simple tips, you can be sure to choose the best HPWH for your home. 

Here’s an exciting seven-minute video of a satisfied customer sharing his thoughts on using a heat pump water heater for over a month: 

Screenshot from a video of a satisfied customer sharing his thoughts on using a heat pump water heater for over a month
Courtesy of Lithium Solar


As the name suggests, heat pump water heaters use pumps to move warm air for water heating purposes. They transfer heat from the surrounding air. This process is much more efficient than simply generating heat, which is how traditional water heaters work. 

Heat pump water heaters use significantly less power than their traditional counterparts, saving you much money in the long run.

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