What is a “hybrid” or heat pump water heater?

Hybrid water heaters, otherwise known as heat pump water heaters, are growing in popularity. It’s easy to see why—they help homeowners save money and energy on a major appliance. In fact, the average water heater accounts for 20% of a home’s energy bill. A hybrid water heater can cut that percentage significantly and pay for itself over time.

Just as a hybrid car combines features from gas and electric cars, a hybrid water heater combines features from tankless and storage tank water heaters. By taking the best features from both models, a hybrid water heater provides heating solutions in a new and innovative way.

How they work

Under most conditions, hybrid water heaters don’t actually generate heat. Instead, they use a heat pump to move heat from the air outdoors into the tank. In times of high demand, like busy mornings when everyone in your home is getting ready, a hybrid water heater switches to electric heating to ensure supply.

The process begins with a fan drawing air from the outdoors. The air is then absorbed by refrigerant. As the refrigerant moves through the compressor, it heats up. Finally, it flows through a heat exchanger and heats the water in the tank.

One way to understand how a hybrid water heater works is to think of the way a refrigerator works. A refrigerator removes heat from an enclosed space and sends it out into the surrounding air. A hybrid water heater does the opposite, taking in heat from the surrounding air and transferring it to an enclosed space.

Features and settings

Exact settings vary by manufacturer, but in general, a hybrid water heater has the following features:

Hybrid or automatic

This is the default setting for a hybrid water heater. It balances using the heat pump and the backup electric heater to save energy. If the heater is installed in the right conditions, it will rarely have to revert to the backup electric heater.

Heat pump or efficiency

This setting maximizes energy efficiency by only utilizing the heat pump. This is the best setting if you’re looking to save as much money as possible.

High demand or “boost”

This setting creates a larger supply of hot water by using the heat pump less and the electric heater more. If you’re hosting house guests or have many water-related chores to do, the high demand setting ensures you’ll have enough hot water for the task.

Standard or electric

If you select this setting, the hybrid heater only uses the electrical units to heat water. It’s the quickest, but least efficient, setting.

Vacation or sleep mode

If you’re out of town, this setting puts the unit to “sleep” until you return. By maintaining a tank temperature of 60 degrees, vacation mode lowers operating costs and protects the tank from freezing in the winter.

Is a hybrid water heater right for you?

Now that you know the basics of hybrid water heaters, you may be wondering; “is this the right choice for my home?” There’s no one right answer, as it depends on where you live and the specifics of your home.  A hybrid water heater could be the right choice for your home if:

  • You live in a warm climate
  • Your home’s appliances run on electricity, not gas
  • You can install the heater in a place where the ambient air temperature remains between 40-90 degrees year-round (like a garage)
  • You have the space to install it (hybrid heaters are often taller than standard storage tank models, and require more room around them)

Pros of hybrid water heaters

Energy efficiency and savings on utility bills are two of the main pros of hybrid water heaters. Other perks include:

Good for warm climates

Because hybrid water heaters pull heat from the outside air, they do well in warm climates like Arizona. Our homes have plenty of areas with excess heat, like garages, which are the perfect location to install a hybrid water heater.

Can work with existing water heater or heat pump

If your home has a heat pump heating system, then you may already be familiar with the mechanisms behind a hybrid water heater. In fact, a heat pump water heater can be combined with the heat pump that heats and cools your home.

In many cases, your existing tank water heater can be retrofitted with a heat pump to create a hybrid model. Hybrid water heaters run on the same electrical system as a storage tank water heater, so you won’t have to call an electrician for an upgrade.


Hybrid water heaters are exceptionally energy efficient. Since they don’t rely on fuel to generate heat, there are no emissions or high energy costs to worry about. According to the U.S. Department of Energy, hybrid water heaters are 2-3 times more energy efficient than standard tank models.

Long-term cost savings

A hybrid water heater uses 60% less energy than a standard electric water heater. Over time, this helps the heater essentially pays for itself in only a few years. ENERGY STAR estimates that a family of four can save up to $350 a year, with a lifetime savings of $3,750. Larger families with higher water usage can expect to save even more.


Cons of hybrid water heaters

Of course, no water heater is perfect, and hybrid heaters have their fair share of drawbacks. By weighing the pros and cons, you can decide for sure if a hybrid water heater is right for you.

Space requirements

A hybrid water heater needs about 1,000 cubic feet of air around it to work properly. They also tend to be taller than standard tank water heaters, to accommodate the heat pump. If you’re in a small space, a compact tankless water heater is a good alternative.

Upfront costs

A hybrid water heater typically costs 3-4 times more than a conventional tank model. Since water heaters aren’t exactly cheap to begin with, it’s no wonder that many homeowners get sticker shock when they start shopping for a hybrid model. But that high investment will pay off with savings on your utility bills. Using less energy means more money in your pocket, and less impact on the environment.

Trust the water heater pros at Chas Roberts

Whether we’re installing, repairing, or maintaining your hot water heater, you’ll experience what sets Chas Roberts apart from countless others in our field. Contact us to get started with all your water heating and plumbing needs.