A new water heater rule could help Americans save energy and money -

A new water heater rule could help Americans save energy and money

The Biden administration has proposed a new energy efficiency rule for residential water heaters, a move that would spur adoption of energy-efficient heat pumps and dramatically reduce carbon emissions from US homes.

The federal Department of Energy, or DOE, says the proposal would eliminate more than 500 million metric tons of carbon emissions over 30 years — equivalent to the combined annual emissions of 63 million US homes. Overall, the agency says the new standards will save consumers more than $11 billion in annual energy costs and cut energy use from household water heaters by 21 percent.

Energy Secretary Jennifer Granholm said in a statement last Friday that these measures “improve outdated efficiency standards for common household appliances, which is essential for lowering utility bills for American households and reducing harmful carbon emissions.”

The rule effectively requires all households using conventional electric water heaters to switch to heat pump water heaters once their older appliances reach the end of their life. The proposal also includes new standards for gas water heaters that require technical improvements to lower energy use. If completed, the new rule will go into effect in 2029.

Heat pump water heaters are two to three times more energy efficient than traditional electric resistance models. They work by drawing heat from the outside air to heat water in a storage tank, rather than generating heat directly.

However, despite the potential energy and cost savings, only 1 percent of American households currently use heat pump water heaters. A recent analysis by the nonprofit Rewiring America found that for the United States to reach net zero emissions by 2050, households would need to purchase 200,000 more heat pump water heaters than usual over the next three years. These additional units sold will help the segment reach a critical turning point called “market acceleration,” where sales will begin to grow sustainably on their own.

While the rule will not go into effect for at least six years, the Biden administration has already made efforts to increase heat pump sales through the Inflation Reduction Act of 2022, President Joe Biden’s climate spending bill. Heat pump water heaters – as well as other electric home appliances such as induction cooktops – are eligible for rebates and tax credits under the law.

Water heating accounts for about 13 percent of household energy use and utility costs in the United States. The Department of Energy says that replacing conventional electric water heaters with heat pump alternatives would save households about $1,900 over the life of the appliance.

The agency last updated standards for residential water heaters in 2010. Last year, the agency proposed updated standards for water heaters for commercial buildings for the first time in more than 20 years.

Several water heater manufacturers, environmental organizations and consumer advocacy groups welcomed the new standards in a joint statement Friday, highlighting both climate benefits and cost savings for consumers.

“Although long overdue, the efficiency standards proposed by the Department of Energy will yield significant savings for consumers over the life of a water heater,” said Susan Weinstock, CEO of Consumers Federation of America, a nonprofit consumer advocacy organization. “We urge the administration to move with the speed necessary to finalize these much-needed standards that eliminate inefficient, energy-wasting water heaters so that consumers pay less on their energy bills.”