Energy-efficient upgrades save money, protect the environment, and make economic sense. Our heat pump water heaters qualify for ENERGY STAR 5.0 certification as well as federal 25C tax credits and local incentives that encourage new construction or retrofits.
These models use electricity to move heat rather than create it, using up to three times less power than gas or electric-resistance models. Our incentive calculator can help you identify potential opportunities in your home.
1. Energy Efficiency
Under this law, all residential gas and electric water heaters manufactured after Jan 1, 2018, must be 25% more energy-efficient than their predecessor models; this significant leap forward will reduce consumers’ utility bills through savings in energy use.
Water heaters that rely on resistance heating elements for producing heat cannot achieve UEF ratings of more than 1. Electric heat pump water heaters, on the other hand, can use relatively minimal electrical energy to output three or four times more thermal energy into water than they consume; to qualify for energy credits under 25C, this requires at least 2.2 UEF ratings on new water heaters.
Tax credits offer an invaluable incentive to upgrade your home with energy-efficient products, worth 30% of qualifying upgrades capped at $2,000 per project.
Most states also provide incentives, rebates, and financing programs designed to make energy-saving upgrades more cost-effective. You can search the Database of State Incentives for Renewables and Efficiency (DSIRE) to identify relevant offerings, or just type “heat pump” into Google search and your state name into the box provided to find local options.
2. Tax Credits
The 25C Energy Efficient Home Improvement Credit is one of the federal incentives designed to make heat pump water heaters more cost-effective for homeowners. Only those filing taxes may apply and claim this non-refundable credit, which means it won’t give back more than you paid in federal income tax for that year. You can learn more by searching the Database of State Incentives for Renewables and Efficiency (DSIRE), while tax preparation software such as TurboTax may help explain your options regarding credits like this one.
Installing a heat pump water heater could earn you rebates from both your local utility provider and manufacturer, and there’s nothing preventing you from claiming both federal credit and these rebates at once, though getting money from local utility providers might take longer depending on their programs.
There are also energy rebates that don’t depend on household income, including ENERGY STAR 5.0 rebates and manufacturer rebates not subject to household income restrictions. Depending on your situation, these may be the best ways to lower the cost of a new water heater purchase.
3. Incentives
Heat pump water heaters use less fossil fuel and emit fewer greenhouse gases, making them an eco-friendly choice. Unfortunately, though, they may be more costly to install depending on your budget; that is why utility and state programs provide cash incentives to encourage homeowners to make the switch.
Oregon residents can take advantage of Pacific Power and PGE rebates of $700 on heat pump water heaters installed, while federal Energy Star tax credits cover up to 26% of installation costs and qualify for up to 26% off their total costs. Furthermore, state, local, and utility incentives may help make heat pump water heaters even more affordable for consumers.
Now available to homeowners, the 25C energy efficiency and electrification tax credit provides up to a 30% rebate off eligible projects, such as heat pumps or HPWHs, electrical panel upgrades installed alongside these devices, certain weatherization measures, and home energy audits.
Credits can be claimed annually and don’t impose lifetime limits like other energy efficiency upgrades such as insulation. Check DSIRE (Database of State Incentives for Renewables and Efficiency) to see what incentives may be available in your region.
4. Easy Installation
Heat pump water heaters may have higher upfront costs than traditional electric and gas units; however, their higher efficiency results in lower energy costs over time. Furthermore, heat pump units produce fewer greenhouse gases and are therefore an eco-friendly choice that could reduce homeowners environmental footprint.
Installing an electric heat pump water heater follows similar procedures as other electric water heaters. Start by disconnecting and shutting off the water supply; clean up your working area to make room for the new unit; make sure it has adequate clearance around its exhaust vent pipe, which typically sits on one of its sides; check manufacturer instructions for installation guidelines (minimum six-inch clearance around vent pipe); check local codes regarding seismic strapping if applicable and follow them until complete.
Heat pump water heaters are easy to install and maintenance-friendly. Regular checks include cleaning the exhaust vent to remove rust, soot, and debris buildup from its passageways, as well as keeping up with manufacturer instructions regarding thermal expansion tanks, temperature and pressure relief valves, and discharge lines—not forgetting proper insulation to minimize heat loss.
FAQ’S
1. What are heat pump water heaters?
Heat pump water heaters use electricity to move heat, making them more energy-efficient than traditional gas or electric water heaters.
2. How much can I save with a heat pump water heater?
Heat pump water heaters use up to three times less power than conventional models, leading to significant savings on energy bills.
3. Do heat pump water heaters qualify for tax credits?
Yes, heat pump water heaters qualify for the federal 25C tax credit, covering 30% of the installation cost, up to $2,000.
4. What incentives are available for heat pump water heaters?
Incentives vary by state, utility, and manufacturer, including rebates and tax credits to reduce installation costs.
5. Is it difficult to install a heat pump water heater?
Installation is similar to traditional electric water heaters but requires proper clearance for the exhaust vent and adherence to local codes.
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