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ROI: Heat-Pump Water Heater vs. Electric Water Heater

rajibroy | Posted in Mechanicals on

Am a to be homeowner of a “pretty good house” in Windsor County, Vermont (CL 6A). Am going for all electric house with ductless heat pump, and will be investing in a community based solar PV project. The house is slab-on-grade, two story building with two separate units (primary unit: 1500 sq. ft. , accessory unit 900 sq. ft).

Located in a heating dominated climate and absence of basement or crawl space, I am wondering what would be best for water heating? Should I choose a Heat-pump water heater(HPWH) or an electric heater and additional investment in a community based solar PV project? 

Here are the points I am thinking about:
HPWH will rob heat in winter, the effective COP might be close to 1.5 when combined with cold climate heat pump heating. The issue with noise and additional installation cost is major concern. The benefit of some cooling in summer months will be an added bonus.

Electric heaters are costly to operate! (high occupancy building: 5 people in primary unit, 3 people in auxiliary unit); Should I invest for additional capacity in my local community solar PV project with net metering to offset electric water heating cost?

How to compare these two options based on Return-on-investment? Any tools or guides will be very helpful.

Note: I got a quote for SANCO2 split water heating system; the price and capacity does not work for my project.

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Replies

  1. paul_wiedefeld | | #1

    Can you fit a drain water heat recovery pipe anywhere? That'd be a great first step: cheap, reliable, and could cut the upstairs hot water usage by a significant amount. Completely complementary to both resistance and heat pumps as well.

    The financial comparison is comparing $/kwh purchased vs. $/kwh saved using a Levelized cost of energy (LCOE). Say the heat pump saves you 2500 kwh per year, lasts 10 years, you use an interest rate of 5%, and the installation price is $2k more. That levelized cost of energy would be: $2000/19,304kwh = $.10/kwh.

    1. rajibroy | | #7

      Thank you for the LCOE example. It definitely helps!

      It Vermont, most areas don't have any rebate for "drain water heat recovery", the 4"x48" pipe at home depot is now $820 (significant rise over couple of years, price of copper, COVID supply chain disruption! who knows?). Overall, I would have to spend 1200 ~1300 for installation in one bathroom most used. Other area with rebates and lower material price might find it good energy saving feature!

      Seems like going Slab-on-grade limits make energy saving options difficult!

      1. paul_wiedefeld | | #12

        Copper is way up, that’s for sure. In Vermont, there’s a lot less need for supplemental cooling and colder incoming water temperatures (that favor recovery) so a long lasting drain water heater recovery pipe probably pencils much quicker than a heat pump water heater.

  2. Deleted | | #2

    Deleted

  3. nickdefabrizio | | #3

    You will get good advice here, let me add only a few extra variables to consider from my experience: I have PV, a number of mini splits in two houses, and a heat pump hot water heater.

    One thing that folks often ignore is the cost of maintenance, another is how robust a system is. Heat pumps are complicated and have many moving parts. My mini splits in the coastal environment have all rotted out in less than 10 years and I have also replaced a motherboard in one (had I not done this myself, I would have had to pay an HVAC guy $7k to replace the entire condenser). On the other hand, PV seems to be relatively robust-with no moving parts and few risks (hail?). Keep this in mind in making your calculations. I like heat pumps but it is not clear they are always the best choice.

    A second thing to consider is the rebate environment: make sure you are familiar with every state and federal program that might be applicable to the respective choices and whether these programs will continue. I love community solar-it is very cost effective. In NJ community solar projects are dominated by big players and there are not nearly enough of them them to be much use....However, I wonder whether net metering will survive in some states. Perhaps you do not have to worry in Vermont, but other states are facing a backlash to solar in general, particularly states where liberal governments are being challenged and may lose out.

    1. rajibroy | | #8

      Yes, all heat pump systems, especially fitted in outdoor, are vulnerable!

      In Vermont, battery storage and solar PV are going strong; but like many other states, it might not be as generous down the road, as it is now!

  4. walta100 | | #4

    Seems to me the HPWH will use ¼ the electricity of the resistance heaters and seems likely to have similar life expectancy. If you buy the solar panels they seem likely to outlast 3 heaters. If you can install solar to cover the load at 6kwh per day system that cost $16k
    If the heaters use 3493 kwh & 866 kwh per year that they the solar for 3493kwh=$25519.00 and 866= $6327.00

    Resistance 700x3+25519= $27,619.00

    HPWH 1630x3+6327= $11,217.00

    Seems to me you may want to consider on site solar.

    You should do the math with your real numbers I used wild guesses. The lower your cost per kwh of solar the better the resistance starts to look.

    Walta

    1. nickdefabrizio | | #5

      On site solar has advantages since you can control it. But community solar is almost always much cheaper up front on a KW basis. If you can find a community solar project where you trust that it will be maintained, that might be a very good choice....

      On the other hand, keep on the lookout for bargains in all systems.....For example, my local Lowes has a 50 gal AO Smith HPHW heater (same unit I have) on sale for $900. NJ offers rebates of $750 so if you self install in NJ you can get a HPHW heater for $150 net.

      1. BFW577 | | #6

        I got my HPWH for about the same amount 8 years ago in CT and self installed it.

        It looks Iike VT has a $800 rebate and allows DIY installs. So the rebate could bring the cost to just a few hundred dollars. The Rheem units are coming up on sale right now at the Home Depot website.

        https://www.efficiencyvermont.com/rebates/list/heat-pump-water-heaters

        You could always just run it in the winter using the elements and switch and get free ac and dehumidification in the summer.

        1. rajibroy | | #9

          HPWH system installation shall be similar to electric only water heater. Glad that after 8 years, still providing hot water. I should learn from the plumber during installation.

          Splitting usage; Summer heat pump only, winter electric only modes will be a great option. My only reservation is considering only 10 year lifetime, I will be using heat-pump for 5 of these years. Will go back to calculation to check how does it fare with solar PV.

      2. rajibroy | | #10

        Thank you Nick!
        So far my observation in central Vermont, community solar installer care for their projects. We are a bit lucky, here!

        These deals are not brainer! Will create some price alert, and try to reach out to store for discount units. Thanks again.

    2. rajibroy | | #11

      Thank you Walter!
      I have found two tools to estimate water heater operational cost and PV output: will definitely help to plug in my project specific numbers.

      https://www.energy.gov/eere/femp/energy-cost-calculator-electric-and-gas-water-heater
      https://pvwatts.nrel.gov/pvwatts.php

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