Best Heat Pump Water Heaters of 2025

These models cost more up front than traditional water heaters. The units we tested range in price from about $1,500 to more than $5,000 (with most models costing $2,500 or less). If you have sticker shock, we get it. You can get a conventional electric water heater for under $1,000. 

But if you have an electric water heater that needs replacing, switching to a heat pump version could offer you significant savings over time. The EPA’s Energy Star program estimates that a family of four could save more than $500 per year with a heat pump water heater that has an Energy Star rating, compared with a standard electric water heater. Those savings would offset the higher cost of the heat pump water heater in as little as three years. 

And there are tax incentives to take advantage of, too. You may qualify for a federal tax credit of up to $2,000 to help cover total project costs, including the cost of the water heater and installation. Many states and even utility companies are also offering rebates as an incentive to choose a heat pump unit. Plus, heat pump water heaters tend to last a bit longer. While a traditional water heater has a lifespan of about 10 to 12 years, a heat pump water heater is expected to last 13 to 15 years. 

Lastly, when you’re considering whether it’s worth it to go with a heat pump, part of the equation is considering what you currently have. If you have a traditional electric water heater, more than likely you’ll be able to convert easily to a heat pump model because both water heaters have the same electrical requirement of a dedicated 240-volt line. 

Switching from a gas model to a heat pump is also a possibility, but that may require electrical upgrades, which can eat into any potential savings. There are also heat pump models that run on 120 volts and can plug right into existing wiring. A 120-volt model may be a good alternative if you’re looking to switch from a gas water heater—as long as you’re aware that the lower-voltage model may take longer to heat a tank full of water.