What Goes into the Cost of Installing a Heat Pump Water ...

### What Goes into the Cost of Installing a Heat Pump Water Heater? #### What Goes into the Cost of Installing a Heat Pump Water Heater? Are you interested in learning more about air to water high temp heat pump? Contact us today to secure an expert consultation! Interest in electric heat pump water heaters is taking off, due in large part to their superior efficiency, tremendous energy savings, and greenhouse gas reduction potential. An ENERGY STAR certified heat pump water heater is typically at least 3-4 times more efficient than standard electric and gas models. As a result, a family of four could save nearly $550 per year in energy costs compared to a standard electric water heater. Those savings translate into average payback periods (compared to purchasing a traditional electric water heater) of 3-6 years and thousands of dollars in savings over the product's life. New federal tax credits and local incentives for heat pump water heaters are making the opportunity to change even sweeter.  While installing a heat pump water heater is generally more expensive than purchasing one of the standard alternatives, they are eligible for a range of current and upcoming incentives that make this smart energy choice more affordable. Federal tax credits established by the Inflation Reduction Act cover up to 30 percent of the unit and installation costs (up to a total tax credit amount of $2,000). In addition, many electric utilities and municipalities offer incentives for purchasing a heat pump water heater, typically ranging from $300 - $1,000. Finally, state rebate programs, another component of the Act, are expected to launch in late 2023.  ### Water Heater Replacement Traditional storage water heaters have an expected lifespan of between 10 and 12 years. In contrast, heat pump water heaters are typically cited as lasting between 13-15 years. When considering a heat pump water heater, we recommend that you proactively plan to replace your existing water heater. This can save money and the added headache of cleaning up a leaky tank and/or footing the bill for an expensive emergency contractor call. Getting multiple quotes in advance can also help you identify a contractor who has experience working with heat pump water heaters and can cue you into other considerations that may need to be addressed as listed below. More than 80 percent of water heaters found in homes today are one of two types: standard electric resistance storage water heaters and natural gas storage water heaters. If you're not sure which type you have, look at the top of the unit. If there is a 3-4” round exhaust vent or flue protruding from the top for ushering combusted gases out of the home, it’s safe to assume that you have a natural gas (or perhaps, propane) storage water heater. If your unit does not have a 3-4" round exhaust vent or flue protruding from the top, you more than likely have an electric resistance storage model. **Tip:** Many installers appreciate a photo or two of your existing water heater and the space around it to assess any hurdles or first steps to prepare your home for an installation. With this information at hand, some may even offer quotes without the need for an in-person appointment. ### Replacing a Standard Electric Water Heater If you are replacing a standard electric storage water heater with a heat pump water heater, the per-unit cost for a new heat pump water heater typically ranges from $1,500 to $3,000 (not including applied tax credits, rebates, and/or utility incentives), though some “split-unit” models (which become a consideration if your space is constrained) can cost several times more. The tank size is one of the most important factors in determining cost. Heat pump water heater tanks range in size from 40 to 80 gallons, with larger tanks typically landing on the more expensive side. **Note:** You should not select tank size based on cost. It is important to size correctly, and sizing recommendations for heat pump water heaters can differ from gas and even from standard electric. You may want to size up in many instances, particularly when replacing a gas unit. Expected costs for materials and labor to install a heat pump water heater can vary widely due to several considerations. A recent informal survey of contractors revealed labor and material estimates ranging from $1,000-$3,000, in addition to the cost of the unit. Some experienced installers charge a flat rate for installation, though most rely on an hourly rate plus materials approach. A general rule of thumb is that the installation cost may be roughly equal to the cost of the water heater itself. However, there are a variety of factors that will play into each individual installation cost structure. Considerations that are likely to impact installation pricing include: - **Local plumbing and/or HVAC labor costs.** - **Condensation management:** Heat pump water heaters capture moisture from the surrounding air in the form of condensate. In traditional mechanical rooms and garages, this water can be routed to a floor drain. In other locations, condensation management will need to be addressed by a contractor and may add an additional cost to installation. Note: The condensation is pure, neutral water, unlike the discharge from some other mechanical equipment, so it can go right into existing drains. - **Air Space:** Heat pump water heaters do not require venting off the unit top as there are no combustion products to release, but they do require at least 450 cubic feet of surrounding air space, which is roughly the available space within an 8' x 8’ utility closet, to ensure proper airflow across the heat pump (Note: Always refer to individual product space requirement specifications. Some manufacturers may recommend additional airspace). Smaller enclosed spaces may be suitable when paired with a louvered door for additional air circulation. Carpentry work, such as installing a louvered door, may increase installation cost. - **Venting:** Just as refrigerators and freezers emit warm air from the sides, rear, or top during normal operation, a heat pump water heater extracts warmth from the surrounding air (even at temperatures below 40F) and emits cooler air. In some cases, homeowners may want to vent this cooler air to an adjoining space. Most manufacturers have venting kits available for an additional fee. - **Sound management:** Heat pump water heaters have become quieter in recent years, with most new models generating between 45 and 60 decibels (db) while running - roughly the quiet hum of a kitchen refrigerator (45 dB) or, on the other end, a modern window AC unit (60 dB). Consider whether this noise level would affect the surrounding environment when utilizing a setup with louvered doors. Make sure to find a location where this noise would not cause a distraction. Manufacturers also offer sound reduction kits if necessary. - **Orientation:** The hot and cold-water lines need to enter the heat pump water heater at certain locations on the unit, and the heat pump fan or blower needs to have adequate access to the surrounding air. While some units can be installed with zero clearance on the back - meaning they can be placed directly against a wall - you must correctly configure the unit's orientation, so follow the installation instructions provided. The flow of air matters for the unit to operate at optimal energy efficiency. - **Thermostatic mixing valve:** Some local plumbing codes and utility programs may require installation of a thermostatic mixing valve with a new water heater. - **Additional electrical permitting:** May be required by local code. Contractors accustomed to installing heat pump water heaters are often more willing to offer fixed pricing and/or lower installation cost estimates than those less familiar and perhaps hesitant to install a product they have not previously installed. Visit ENERGY STAR’s Heat Pump Water Heater and Installer Finder to locate contractors with experience in your vicinity. ### Replacing a Gas or Propane Storage Water Heater When replacing a fuel-based water heater, there are additional considerations associated with installing an electric heat pump water heater. These include: - **Electrical service capacity:** If you are switching from a fuel-based water heater, you may need to expand the electrical capacity of your home at the breaker box. A contractor should be able to tell you whether an upgrade is required and how much it will cost. - **Sealing of vent penetrations:** Fuel-based water heaters have pipes or ducts that vent to the outdoors. Heat pump water heaters do not vent outside, so those penetrations need to be sealed. Sealing entry points helps reduce air leakage and makes a home more energy efficient, so it is a win-win! - **Electrical availability:** Besides confirming that your home’s electric panel can support the additional load of a heat pump water heater, a 240-volt electrical supply needs to be available at the local site of the installation. Additional electrical work, like running dedicated conduit from the breaker box, may be necessary if proper wiring is not available near the installation location. - **Proper sizing:** Each unit needs to be sized properly according to the individual manufacturer's specifications. Usually, when switching from a gas to a heat pump water heater, you will need to size up - for example, from a 40-gallon to a 50-gallon or from a 50-gallon to a 65-gallon - to ensure that recovery time between significant use events is not compromised. - **Capping the gas:** When converting from gas to a heat pump water heater, the installer must also cap the gas line at some point leading up to the water heater. The cost for doing so, though, is typically nominal. ### Make Energy Choices that Count Installing a heat pump water heater is one of six energy-saving improvements you can make as part of an ENERGY STAR Home Upgrade to help prepare your home for the clean energy future. To find a local heat pump water heater installer, check out ENERGY STAR’s Heat Pump Water Heater and Installer Finder. ### How Much Does a Heat Pump Water Heater Cost? Heat pump water heaters are a great alternative to traditional water heaters. But how much does a heat pump water heat cost? Compared to conventional water heaters, they cost more on average. However, heat pump systems are drastically more efficient than standard gas or electric water heaters, producing impressive savings over time. We spent countless hours getting real heat pump water heater quotes so we could give you the most accurate and up-to-date cost data. This guide explores common costs associated with heat pump water heaters to provide you an idea of what to expect from your installation. Need a new heat pump water heater for your home? Use the widget below to get quotes from top-rated local contractors today. Get Free Estimates From Professional Plumbers Match with a plumbing expert to help you with installation or repair. How Much Does a Heat Pump Water Heater Cost? A heat pump water heater usually costs around $3,600, although costs may dip as low as $1,200 or as high as $6,000 or more. However, it’s important to note that the exact cost of your project hinges entirely on factors specific to your installation, including the system size, installation difficulty, and system efficiency. **Low**|**Average**|**High** $1,200|$3,600|$6,000+ ### How Do Heat Pump Water Heater Costs Differ By Size? The size of an electric heat pump water heater plays a critical role in determining the final cost of the system. The larger the unit’s capacity, the more you’ll pay for your setup. The chart below offers a quick peek into common costs based on size. **System Size**|**Average Cost** 40 gallons|$1,200 – $2,000 50 gallons|$1,500 – $2,800 65 gallons|$1,800 – $3,000 80 gallons|$2,500 – $6,000 ### 40 Gallons A 40-gallon heat pump water heater is best suited to small homes with one or two people. These units can only adequately supply enough water for a few showers before they need more time to heat water, so they’re not ideal for larger homes. On average, these systems cost between **$1,200 and $2,000**. ### 50 Gallons A 50-gallon heat pump water heater works well in smaller homes with two to three people. Like the 40-gallon tank, it may run out of hot water after around 20 minutes of continuous showering, so it’s best suited to smaller homes or households where residents don’t regularly take consecutive showers. These systems usually cost between **$1,500 and $2,800**. ### 65 Gallons A 65-gallon tank takes things a step up, featuring a larger capacity and the ability to provide more hot water for more toasty rinses. It can supply plenty of hot water for midsize homes, as it has enough capacity to deliver up to 30 minutes of hot water for showering. A 65-gallon system usually costs between **$1,800 and $3,000**. ### 80 Gallons The 80-gallon tank is the largest of the bunch and is usually best suited to midsize to large homes with higher hot water demands. These systems can deliver 40 minutes or more of hot water for showering, making them ideal for more than a few individuals. These systems are pricier, as most homeowners pay **$2,500 to $6,000** or more. ### How Does Efficiency Affect Heat Pump Water Heater Pricing? The energy efficiency of a heat pump is a critical factor when considering the overall cost of the system. The U.S. Department of Energy measures a water heater’s efficiency using the uniform energy factor (UEF). The higher the number, the more efficient the unit. Most heat pump water heaters have a UEF rating of 2.75 to 3.5. This is substantially higher than the typical UEF rating of a conventional natural gas or electric water heater, which usually falls between 0.65 and 0.95. More-efficient heat pump water heaters are usually pricier, whereas their less efficient counterparts are generally less expensive but have higher operating costs. However, since the cost of the system is highly dependent on its size, smaller models with high efficiencies are still usually more affordable than larger models with lower efficiency ratings. Here are the average costs based on the efficiency of the heat pump water heater: **Efficiency (UEF)**|**Cost Range** 2.75|$1,200 – $2,000 3.0|$2,000 – $3,700 3.25|$2,500 – $4,800 3.5|$3,000 – $6,000 ### Which Factors Impact Heat Pump Water Heater Cost Estimates? The cost of your heat pump water heater and the subsequent installation hinges on an array of factors, from labor costs to permitting. Here are a few key factors that contribute to the cost of your project. #### Labor The cost of labor is one of the most important factors playing into the cost of a home-related project. Of course, if you DIY the project, this factor isn’t anything you need to worry about, as it’s your own time. However, if you plan to hire a professional to complete the project for you, remember to factor in labor costs. Labor costs vary from state to state and even at the county level. Typically, heat pump water heater installation costs range from **$1,000 to $3,000**, or about equal to the cost of the water heater.  For more pool heat pump calculator information, please contact us. We will provide professional answers. You can always get quotes from a couple of local contractors to help you prepare and budget for your project. Still, it’s important to remember that unexpected complications can require more time and labor, adding to the cost of your project. So, to be on the safe side, ensure you leave some wiggle room in your budget. #### Removal Removing an old water heater setup will add to the cost of your project. If you have your contractor remove, haul away, and dispose of your old water heater, you can expect to pay more overall for the project. Removal costs vary depending on your location and contractor. Some may remove it for free, but it usually costs **$100 to $300** for removal. However, if you’re starting from scratch and don’t have an existing water heater, this factor won’t impact you. #### Permitting Most areas require homeowners to obtain a permit before installing a new water heater or HVAC-related system. Since a heat pump water heater ties into both categories, you’ll likely need to obtain specific permits to complete the project. If you hire a contractor, they can tell you more about the permits you’ll need before starting the project. In some cases, they might even include this cost in their bid and handle this part of the project for you. Permit costs vary depending on where you live but typically range from **$50 to $400**. If you’re DIYing the project, talk to your local building authority for more information about necessary permits. #### Location Your location can play a key role in the cost of your heat pump water heater and associated installation costs. For example, in areas with high demand or remote areas, you might pay more for installing these systems. On top of that, labor costs vary drastically based on living costs, so some areas have higher labor costs than others. For example, if you live in the heart of a city with a high living cost, you can expect to pay more for your project. In contrast, if you live in a rural area with a lower cost of living, you’ll likely pay less for your installation. #### Installation Difficulty The difficulty of the installation plays a critical role in determining the final cost of your heat pump water heater project cost. If you choose to DIY the installation, this factor isn’t as much of a concern, but if you hire a contractor to handle the project, it’s a pivotal factor that impacts the price. The more complex the installation is, the more you can expect to pay for your project. More complicated installations require more time and labor to complete the task, resulting in higher costs overall. For example, if the job only takes one hour, it will cost less than a job that takes three hours. In contrast, simple installations without unexpected delays or complications are usually more affordable. Unfortunately, it can be hard to determine the installation difficulty level until you begin, so ensure you budget for some variation in this area. Of course, certain factors will create obvious complications. For example, if the space you’re having the system installed in is hard to reach or not easily accessible, you can expect to pay more for the installation, as it will likely take your contractor more time to complete the task. #### System Brand As with many products, the cost of a heat pump water heater varies based on the brand you choose. Some brands charge more for their products, whereas others feature more affordable prices. Generally, the more well-known brands charge more, while the unfamiliar brand names offer less expensive equipment. For example, you can find A.O. Smith, Ecosmart, and Rheem Proterra or Performance Platinum heat pump water heaters for **$500 to $2,000**, depending on size, efficiency, and type. On the more expensive end of the spectrum, you can find Goodman, Daikin, Bosch, and Bradford White heat pump water heaters available for **$1,700 to $4,000**. ### What Are the Benefits of a Heat Pump Water Heater? Heat pump water heaters have a clear edge over traditional gas and electric water heaters. Below are a few of the main benefits these systems have to offer. #### Better Efficiency,