HEAT PUMP WATER HEATER
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HEAT PUMP WATER HEATER

What Is a Heat Pump Water Heater and How Does It Work?

By Mike Holmes

Mike’s Advice / Plumbing & Water Quality

Wednesday, April 16th, 2025 @ 12:32pm

How Do Heat Pump Water Heaters Work?

You’ve seen us install tankless water heaters on our jobs, but if you’re considering replacing a traditional tank water heater, a heat pump water heater (HPWH) is worth a look.

A heat pump water heater (also known as a hybrid water heater) can be an energy-efficient option for many homes using less energy than standard models. These water heaters are well insulated and can heat water more quickly. That means lower energy costs for you. 

I first learned about this technology at the AHR EXPO in 2024, and I was very impressed. Let’s take a closer look at heat pump water heater technology. How do heat pump water heaters actually work?

 

 

What Is a Heat Pump Water Heater?


You may be familiar with heat pump technology. A heat pump water heater (also known as a hybrid water heater) uses the same energy-efficient technology to transfer heat from the surrounding air into the water, rather than generating heat directly like traditional electric or gas water heaters. 

 

Heat Pump Water Heater vs. Traditional Water Heater: What’s the Difference?

A traditional electric heater tank water heater heats water by using electricity to generate heat directly. 

A heat pump water heater moves heat instead of creating it. This makes it 3 to 4 times more efficient.

 

 

How Does a Heat Pump Water Heater Work?


A heat pump water heater transfers heat from one place to another. In this case, they move heat from the air inside your basement, utility room or garage to heat your water. The process works because the refrigerant inside the pump is colder than the surrounding air, allowing it to absorb heat. 

The heating process begins with a fan that pulls in warm air from the surrounding space. A refrigerant then absorbs this heat and moves it through a compressor, where the temperature is increased. The hot refrigerant passes through coils wrapped around and inside the water tank, transferring heat to the water. 

As the refrigerant loses heat, it cools down and releases cool, dehumidifier air back into the room. This process continues until the water reaches the desired temperature.

 

What Are The Benefits Of Installing A Heat Pump Water Heater?


They use 60-70% less electricity

Heat Pump Water Heaters (HPWH) perform optimally in environments where the temperature remains above 40°F (4°C) year-round. 

They use 60-70% less electricity than traditional electric water heaters. This means homeowners can save hundreds of dollars annually on energy bills. 

 

A More Sustainable Choice

In addition to lowering energy costs, Hybrid Water Heaters reduce carbon footprints, making them a more sustainable choice. With proper maintenance, they can last between 10 to 15 years. 

 

Good Replacement For Tank Water Heaters

The Bosch hybrid electric water heater (which is what I install on my jobs) is specifically designed as a seamless replacement for conventional electric storage units, featuring identical power and water connections. 

 

Rebates For Hybrid Water Heaters

Many utility companies and government programs offer rebates for heat pump water heater installations. This makes it more affordable. 

Check out the Bosch Home Comfort link to find rebates and incentives in your area to see what’s available.

 

50 Gallons or 80 Gallons

The water heaters with heat pump technology from Bosch are available in 50 gallons or 80 gallons. Good options for households of different sizes.

 

Considerations Before Installing a Heat Pump Water Heater


A heat pump water heater needs about 700-1,000 cubic feet of air space and is ideal for basements, garages, utility rooms or areas with warm air. 

There are higher upfront costs but it pays off over time in energy savings. Hybrid water heaters work best in moderate to warm climates but may require a backup heating source in colder areas.

The GreenTonic 7000 T is a hybrid electric water heater designed to be a perfect replacement for electric storage units, making it an ideal option for both retrofits and new construction. 

Remember, you will also need to confirm with a licensed electrician to ensure your current electrical panel and service can handle new appliances like a heat pump water heater.

 

Why I’m a Fan of the Bosch GreenTronic 7000 Hybrid Water Heater


I get excited when I learn about new technologies and innovations related to home mechanics, and the heat pump water heater is no exception. The team at Bosch is dedicated to innovation, so I was excited when the Bosch GreenTronic 7000 Hybrid Water Heater launched last year. 

 

heat pump water heater by Bosch

Heat Pump Water Heater by Bosch

 

Here are some of the reasons I’m a fan of this product and recommend you look into this if you’re in the market for a new water heater:

  • Is up 3 or 4 times more efficient than a traditional electric water heater without sacrificing comfort
  • Back-up heating elements are available for when faster heat-up times are needed
  • Operates at 49 dB(A), comparable to a quiet refrigerator.
  • Optional duct adapters give flexibility of air flow and installation space.
  • Convenient connections: Water connections on the left and electrical on the right means that plumbers and electricians can work simultaneously. The heater can be installed in a corner since there are no connections on the back.
  • 10-year limited warranty on tank and parts including 1-year labor.
  • You can buy an auto shutoff leak protection kit to go along with the unit. This detects leaks and will shut off the supply of water to your water heater.

 

Importance of Professional Installation


Like with most home mechanical systems installing a heat pump water heater is NOT a DIY job. It should be installed by a licensed professional for optimal performance and service. 

I would recommend going a step further and using a manufacturer certified licensed professional, like a Bosch Home Comfort Pro as they are specially trained in that specific brand and type of units, giving you peace of mind and warranty coverage.

 

Pro Tip: Electrical work is never DIY and should always be done by a licensed electrician. They’ll also be able to assess your current system and see if it can handle the load.

 

Heat pump water heaters may have a higher initial cost compared to traditional units, but they can lead to significant savings on your energy bills. These modern heat pump water heaters are a worthwhile investment because they consume less energy, resulting in both cost savings and longer lifespans. 

Additionally, with available rebates, incentives, and energy savings, upgrading could pay for itself over time. If you are looking for a smarter and more energy-efficient way to heat your water, this could be the right choice for your home.

 

RELATED:

HEAT PUMP MYTHS – BUSTED!

 

Heat Pump Water Heater FAQ


Do heat pumps use more electricity than heating? 

Generally, heat pumps are more energy efficient.

 

How much can I save on energy bills with a heat pump water heater?

According to Energy Star, compared to a standard electric water heater, an HPWH uses 60-70% less electricity. This can save a family of four roughly $550 annually on their energy bill, leading to expected lifetime savings of over $5,600! 

 

Can I install a heat pump water heater in my existing home?

Yes, but work with a licensed professional to ensure the installation is done properly. Most heat pump water heaters use identical power and water connections of traditional units.

 

How noisy is a heat pump water heater?

Most heat pump water heaters have a low humming noise, like a refrigerator. However look for models with 45-55 decibel range.

 

How long do heat pump water heaters last?

Most high-quality heat pump water heaters should last 10-15 years or more with regular maintenance and service.

 

Are there government rebates or incentives available?

Yes, contact your local dealer or government agency to find out about rebates, incentives and programs to help make your home more energy efficient.

 

How can I adjust the temperature of the hot water?

Most heat pump water heaters have dials or digital settings that allow homeowners to customize the water temperature and flow depending on the model.

 

About Mike Holmes:

Mike Holmes is a renowned renovation expert, contractor, and television personality. With decades of experience, he specializes in home improvements, repairs, and building projects. Known for his commitment to quality and safety, Mike is dedicated to helping homeowners achieve lasting, well-crafted renovations through his popular TV series, Holmes on Homes.

 

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