The great case of hybrid water heaters

Rheem 50 Gallon Proterra Hybrid Water Heater

Cutting to the chase

I instrumented and datalogged my new heat pump water heater, also known as a hybrid water heater. It saves about 180 kWh of energy per month and reduced my monthly power bill by $23, while also dehumidifying and cooling the garage by 5% RH (Relative Humidity) and 2 degrees F. (Scroll down to see some cool graphs)

How water heaters work

Drawing of conventional resistive heating element water heater

Historically, water heaters were simple devices. A heating element is contained within an insulated tank to heat water. It is 100% efficient, where every watt of electrical energy is used to heat the water. At first glance, it is hard to improve this.

With modern engineering, this device can be about 3 times as energy efficient. If you are running the numbers, 3 times 100% efficiency equals 300%!

Energy cannot be created or destroyed. So how can it seemingly break the laws of physics?

The beauty of heat pumps

Cutaway of heat pump water heater operation

Instead of spending energy to directly heat the water, you can spend the energy to TRANSFER it from the ambient air and concentrate it into your water tank. Even if the air "feels" cold, it still has energy inside of it that can be concentrated and transferred. It's essentially an air conditioner sitting on top of your water heater. You could almost call it a "hybrid water heater." Note: The image above is from website (opens in a new tab)

Motivations for switching

I spend quite a bit of time working in my home shop, which can get quite hot and humid. Naturally, I looked into air conditioning the space. Installing a mini-split is quite involved compared to installing a heat pump water heater.

If I'm going to ultimately pump heat out of the shop, I might as well "save" that energy and concentrate it into the water tank. This not only reduces the power bill but also makes the shop more comfortable to work in—a huge step in the right direction.

What brand or model to buy?

Do your own research and read recent reviews. The big-name manufacturers are Rheem, Bradford-White, GE, and AOSmith. The exact model I used was a Rheem 50 Gallon Proterra.

Is there a difference in operation?

Nope! I open the tap, and hot water comes out. No thoughts past that.

When this might not be a good idea

  • If you live in a northern region with real winters

You will be operating at lower efficiency and removing heat from your house. Hybrid water heaters work better if your ambient temperatures are warmer, and if you prefer to dehumidify and air condition the space around it. In the southern regions of the USA, you are running the air conditioner almost all the time, and the heater almost never turns on. If this is your case, then hybrid water heaters will probably be a good fit.

  • If you want bombproof reliability.

    There is no question that hybrid water heaters are more complicated machines. If the power surges or some small component fails, a hybrid water heater has more chances of failing when compared to a conventional electrical water heater. In my opinion, it is worth the extra complexity, as more people buy these units, economies of scale and competition will occur in parts and service.

  • If you are purchasing a hybrid water heater to reduce "faceplate" electrical demand on your house.

    Under eco mode, it draws about 400W of power, but the faceplate is roughly 5kW due to the backup heating elements in the unit. You have to use the worst-case load when calculating your service load.

Payback Period

Pure MSRP Cost
6.25 years
Add Tax Credit deduction
4.3 years
All costs factored
2.5 years

After taxes, my unit cost about 2kUSD.BasedontheyellowEnergy.govstickeronthewaterheater,itsaves2k USD. Based on the yellow sticker on the water heater, it saves 319 per year when compared to a conventional electric water heater. 2000/2000/319 a year in power savings equals approximately 6.25 years to ROI.

With the Inflation Reduction Act and the associated 30 percent tax credit, it's about 4.3 years before the unit pays for itself!

In real life, the ROI is even better. If your conventional water heater fails, and you are shopping for a new one, the purchase price in the ROI calculations is the spread between a heat pump and conventional cost. For my case, I just sold my old water heater for $300, since it was in almost new condition.

For most people, it's the difference betweeen buying a hybrid at 2kandaconventionalat2k and a conventional at 600 at replacement time. So the ROI is now actually 2.5 years!

These calculations are based on usage by the organization. Not my exact usage. I instrumented my machine and calculated the exact payback period based on my use. With my actual energy usage and electricity costs, my electric bill dropped by about 180 kWh per month.

Billed at 12.3 cents per kWh, it's a savings of $22 per month. Using the previous values and selling my old unit, it ROI's in about 4.1 years! Assuming the unit lasts at least 10 years (i.e., the warranty period), then it will almost pay for itself again in power savings!

Energy and Temperature Graphs

All the data below is datalogged from my exact unit and usage patterns. In general the more people that live in your house, means you will get more savings.

Using data collected over several days, There is a daily energy difference of a factor of 6. This seems a bit to good to be true, considering the COP (Coefficent of preformance) for water heaters is about 3. But keep in mind that this data is not perfectly controlled. Data was collected in a house with variable usage patterns.

Average Daily Energy Use Between Water Heater Types

Smaller values are better.

Heat pump data is averaged over 14 days and the conventional water heater had 43 days of data collected

The chart below gives an idea on the amount air conditioning the water heater provides. While it is not much, it does make a noticable difference at night.

Keep in mind the temperature sensor was on the opposite corner of the shop, and near a south facing door. When standing next to the unit it blows very chilled air. Feels like 70F.

Temperature and Humidty over a 24 hour period

The average outside temperature for both days was about 81 degrees F. Space south facing exterior wall 400sqft

Based on the data, heat pumps run at a lower power draw, but for a longer period of time. The opposite is true for conventional units. The total Kwh consumed for the day was 2.64 kWH and 10.6 kWH for the heat pump and conventional unit respectively. This gives a 4x energy savings. Still a bit good to be true.

My only current theory is that in ECO mode, the water heater also behaves like Google Nest but for your water heater. It only turns on based on actual usage and not holding an arbitray temperature 24/7.

Energy over a 24 hour period

The average outside temperature for both days was about 81 degrees F.

Datalogging details

I measured voltage and current draw via an IotAWatt (opens in a new tab) device, an open-source 14-channel data logger that "amp clamps" to circuits in your breaker panel.

For temperature and humidity, I used a Kestrel 5200 that auto logs every 2 minutes. The Kestrel was located on the opposite side of the shop so that the air has a chance to mix and stabilize before being measured.

The 24-hour period graphs were logged within a 48-hour period, but life also happens, and people use hot water as they need. That's why you won't see perfect synchronization on conventional and hot water energy draw at a specific point in time.

Parting thoughts:

I wonder if there are intelligent ways to take advantage of the waste heat from central air conditioners. Dumping that heat into an outdoor pool seems like a win-win, but the seasonal production and demand timing would not be ideal.


If you live in a hotter region, and have the liquid capital to deploy, purchasing a quality hybrid heat pump is a no brainer.