Heat Pump Water Heaters

Heat pump add-ons save energy and are eligible for tax credits

Reviews say ongoing service is even more important in choosing a heat pump water heater. This type heats water with energy that would otherwise be wasted -- from the surrounding air or from an air conditioner or furnace. It's far more efficient than other electric water heaters, especially in warm humid climates that need air-cooling and dehumidification along with hot water.

The payback rate is usually slower, but a family that conserves hot water can cut costs a great deal by using this type of water heater. The least expensive heat pump water heaters just attach to a regular tank-style water heater, converting the tank into a backup when faster hot water is needed. Heat pump water heaters are the only electric water heaters efficient enough to qualify for a 30 percent federal tax credit.

The newest model is a GE hybrid water heater that combines a heat pump and tank-style water heater in one unit. GE announced this model in January 2009, but it's not scheduled to get on the market earlier than October 2009. We found a preview of it at the Consumer Reports blog, but no performance tests exist yet. GE claims that it will use less than half the electricity of a comparable tank-style model, saving an estimated $250 a year in operating costs. No pricing has been announced.

The AirGenerate AirTap A7 (*est. $700) is a small add-on heat pump that sits on top of a regular storage tank water heater. It can cool and dry the air around the water heater, or -- if you need cool air more in another room -- use the optional AirVent (*est. $80) to connect to an air conditioning duct or just to another room. With an EF of 2.2 -- off the scale, really -- this device also qualifies for state and local rebates in many areas, in addition to the federal tax credit. The AirTap A7 plugs into a regular 110-volt outlet.

The E-Tech R106K-5 heat pump water heater (*est. $1,000), made by Applied Energy Recovery, gets good reviews at GreenBuilding.org, though some owners say it can be hard to get service. One owner in Alabama says it cools 2,400 square feet and provides enough hot water for a family of five -- including three teenagers (an age group noted for using a lot of hot water). Jim Dulley's report on heat pump water heaters notes that this company has been in business a long time, and the basic design of the E-Tech is well tested.

Dulley's report describes quite a few heat pump water heater models. The Nyletherm-1 (*est. $825) is one of the models that plugs into a regular 110-volt outlet, making it especially easy to install. It can mount on a wall or sit on the floor beside a tank water heater rather than on top of it. In addition to heating water, it dehumidifies at the rate of about one quart per hour.

Other models attach to an air conditioner, geothermal system or operate as standalone units. These bigger heat pump water heaters need to be selected and installed by an expert contractor, and are beyond the scope of this report. See our Useful Links section for more information.