You can still claim a federal tax credit of up to 30% of the cost (a maximum of $2,000 per year) for the purchase of a qualified heat pump water heater, but you must act fast — these incentives expire Dec. 31.
As CleanTechnica reported, the New Buildings Institute conducted a survey on the average price consumers paid for a heat pump water heater last year. The total came to roughly $4,700 ($2,000 for the system and $2,700 for the installation). Applying the 30% tax credit shaved about $1,410 off the cost of a unit.
In addition, the Home Electrification and Appliances Rebate program offers a $1,750 rebate to low- to moderate-income households for an eligible heat pump water heater, according to Energy Star. The program will run until funds are exhausted or Sept. 30, 2031.
Energy Star reported that a four-person household can save around $550 a year on energy bills by switching from a standard electric water heater to a heat pump version. Since water heaters account for roughly 12% of a home's energy use, per Energy Star, it's important to have an energy-efficient system that can keep up with your household needs.
Heat pump water heaters work by moving heat from the air into the water rather than generating heat directly from electricity, resulting in efficiency two to three times that of conventional electric water heaters. The increased performance not only translates to lower electric bills but also to reduced levels of heat-trapping pollution from household appliances.
Since tax credits will expire soon, make sure to complete installations sooner rather than later to save thousands of dollars on home upgrades. When you're ready to start shopping, LG is an excellent resource to help you find an efficient water heater that suits your needs and budget. With its free tools, you can locate a qualified contractor in your area; simply type in your ZIP code to get started.
"I LOVE my heat pump water heater. It is helping us save money because it's more efficient, got the gas out of our house, and has worked like a charm," one of The Cool Down's members said.
"I just bought a LG WWHP, 270l. It is stated to use around 750kwh/year," a user in the r/heatpumps subreddit said in response to someone asking if the appliances were worth it. "In reference, the electric heaters are all stated around 4.000 kwh/year."
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