Read the Operating/Installation Manuals for candidate heat pump hot water heaters as to minimum required room space size.

I think that installing a heat pump/hybrid water heater in a conditioned air space will disallow any credit/rebate from your electric company; at least it would for my company. I had to submit a picture of the water heater after install and affirm that it was installed in an unconditioned space.

FWIW, you will still save $ even if you don’t qualify for the electric company’s rebate. The government is giving a $300 tax credit on these this year.

Can you say what you mean by a conditioned air space? Sorry this is my first time buying a home and I am learning as I go.

thanks for your insight into the rebate requirements. I’m more concerned would it even work in a small space? I read online you might need lots of cubic feet around it, is this not entirely true? My Utility closet has space for a hot water heater and pressure tank and then there’s some space to spare. I’m sure more than 7” but not much more than that. Thank you.

You might have to install a louvered door on the closed if you are not providing outside air or exhausting it to the outside. The installation costs will be higher than a traditional hot water heater. If you are not going to use a lot of hot water then it might not be worth the extra costs even with the rebates.

Unconditioned space is a part of the house that is neither heated or cooled. An attic or garage would be an example. I don't understand the logic as to why an electric utility would have this requirement. Was the reason for this explained?

I think the thinking was that in removing heat from the air and returning cooler air that the WH was sometimes working counter to your home’s hvac system thus negating some of the savings. The air space around your WH will be noticeably cooler and dryer than elsewhere. We no longer run a dehumidifier in the room where our hybrid WH is installed.

Dehumidifiers tend to consume a lot of electricity, so in your case the electricity demand is less. I would also think the cooling affect would also allow the AC to run less often which is additional savings of electricity.

Thanks, this is all really helpful. Unfortunately AC isn't really a major concern with the home, as it's in the mountains and stays quite cool in the summer. Heating is obviously my bigger cost.

The one question I have about cooling and the room being unconditioned is, doesn't there have to be some heat since this is where my plumbing begins? The basement is only around 3.5 feet underground and has windows so I imagine it will get cold in the winter. I am installing a mini split system in the whole home and was going to put one head in the basement, mainly to keep an ok temp throughout the winter. Is there any risk that the heat pump water heater could make the basement too cold for the plumbing? Or too difficult for the heater to keep the basement above 50?

I just bought the home and it was a foreclosure and the pressure tank and some pipes are cracked from freezing. So I'm trying to come up with a setup here to A) keep utility costs down and B) prevent the plumbing from freezing again. All your insights are so helpful!

The heat pump can extra air even if the temperature is below freezing. The amount of heat it can extra drops as the air temperature goes down.

I don't own a hybrid hot water heater, so I can't comment how cold it will make the basement. If there is any concern about this then you can add outlet duct kit. It is an 8 inch flex duct that can be used to pipe the cold air to the outdoors.

How big is this utility closet? I'd be surprised if you couldn't get a regular 40 gal electric tank heater in a utility closet, and probably a heatpump water heater (they are usually about 12" taller than a regular tank). But it all depends on the size of the utility room. How big is it (LxWxH)?

I'm going to measure the closet tomorrow when I am there again, yes it's definitely big enough for both a heat pump HW heater and a pressure tank. But then that's about it, it'll be tight. My real concern wasn't that I couldn't fit it in the closet. My concern was that in the heat pump specs it often says to have 1000 cubic feet (or say 100 sq feet) of space around the HWHP.

@BryanTheGrower,

Just to say, your refrigerator and/or freezer are heat pumps, in reverse of how the water heater would function. A refrigerator extracts heat from inside the food compartments (down to 0°F-ish for the freezer section), moves it into the room/kitchen/house vs. the water heater that extracts heat from the room and puts it into the water tank.

Hybrid water heaters also have regular electric heating elements that supplement for fast-recovery mode, or they can (presumably) be set to operate as a regular electric unit when desired (such as if the compressor/heat pump part develops a problem, like an air conditioner heat pump in emergency/auxiliary mode).

@bryanthegrower, FWIW, my GeoSprings HW heater’s heat pump function is inoperable when the ambient temperature in the room falls below 47 degrees. It will switch over to using the heating elements at that temp. YMMV. It’s not going to “super cool“ your basement.

My Heat Pump Hybrid Hot Water Heater - located in my humid and cold below grade basement in MD - removes maybe a half pint of condensate from the air per day. It makes no difference in room temperature.

While there are some nuggets of truth in this thread, I'd take with a grain of salt most "facts" presented by folks that have never owned one.

My wife and I save about $30 per month in electrical energy usage to heat hot water. (I do not have gas available.)