Heat Pump
Hot Water Heater

Water heating is typically the second-largest energy expense in a home; it can cost the average household approximately $400–$600 each year. Properly maintaining your water heater and choosing high-efficiency equipment can help you save energy, improve the comfort of your home, and contribute to a cleaner environment.

What are the benefits?

  • More energy efficient than conventional water heaters, resulting in lower utility bills
  • Lower operating costs than conventional water heaters
  • Produce fewer greenhouse gas emissions, contributing to a cleaner environment
  • Total cost (unit plus installation) is currently about twice that of conventional water heaters. However, lower operating costs can offset the higher purchase price in just a few years.
  • Extremely cost-effective way to reduce the greenhouse gas footprint of a home.

Is this right for my home?

  • Location needs to have at least 1,000 cu ft. of air space around the heater; heat pump unit is on top and so required floor to ceiling clearance is higher than conventional models.
  • Hot water heat pumps are best in a location where the temperature remains 40˚ – 90˚F (4.4 – 32.2˚C), but most can function like a traditional electric water heater if conditions get colder.
  • Operation of the unit both slightly cools and helps dehumidify the space it is in.
  • Installation is comparable to traditional electric storage hot water heaters; a drain for condensate is required.

Want to Learn More?

See Homeowner Success Stories and check out our most recent webinar recordings.

What will it look like
in my home?

Heat pump water heaters use electricity to move heat from one place to another instead of generating heat directly. This makes their operation far more energy efficient than conventional resistance electric heaters or those fired by natural gas, oil, or propane. Heat from the air is transferred to water in a tank, which is heated to 130 to 135 F. This is the process of a refrigerator, in reverse.

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Incentives and Rebates

Heat Pump Hot Water Heater (HPHWH) rebates vary by utility.

See the chart below to discover the utility and state offered incentives and rebates for HPHWH installation.

The EnergySmart Homes partner-installers will find your relevant state and utility rebates using calculations specific to your building and the proposed equipment. Every EnergySmart Homes partner installer has the necessary accreditation, software, and experience to accurately inform you of your true bottom line (included on your proposal) and will assist you with the paperwork. The EnergySmart Homes Team is here to help!

To access the utility rebates and state incentives you must use a Con Ed, NYSEG or NYSERDA participating installer.

Inflation Reduction Act:

The Inflation Reduction Act (IRA) empowers American households to save thousands of dollars on the upfront costs of electric machines, like heat pump hot water heaters. Learn more here.

See Rewiring America’s IRA calculator to see how much money you can get with the Inflation Reduction Act

Water Heating Incentives

Overview of Programs
to access ASHP rebates

  • To install a HPHWH and access the utility rebates, call an EnergySmart Homes contractor to schedule (link to installer page) your site visit.
  • Income eligible participants can access additional incentives through a NYSERDA program. Eligibility is based on household annual income.
  • Assisted Home Performance with ENERGY STAR provides incentives to eligible homeowners for heat pump hot water heater installation, in addition to other energy efficiency upgrades. See the Home Energy Efficiency page for more details.

Financing & Loan

This document provides information regarding financing options through NYSERDA for homeowners who are looking to install heat pumps and energy efficiency upgrades in their homes. It includes information on:

  • On-Bill Recovery Loan
  • Smart Energy Loan
  • Companion Loan
  • Renewable Energy Tax Bridge Loan

It also provides information on each loan’s interest rates and the general loan approval criteria for NYSERDA loans.

Residential Loan Information

Our EnergySmart Homes Partner Contractors offer additional financing options.

Contractor Loan Information

Federal Tax Credit

Don’t forget to take your IRS tax credit for heat pump installations. ENERGY STAR air source heat pumps qualify for a $300 credit. Consult a tax professional for questions about how to take advantage of this tax credit. This chart contains information about eligibility, home improvement solutions, and incentives for the Federal Tax Credit.

For More Information

Contact Lauren Brois


914-242-4725 x122

Email inquires to