Subscribe to our newsletters & stay updated
Comprehension of the complexities of heating systems escapes most homeowners, but everyone understands the cost. Inflation in energy costs has risen 182 percent since 1983, according to the U.S. Bureau of Labor Statistics (https://bit.ly/46tBZrh).
While that figure is astonishing, the more glaring number is evaluated in real dollars. Homeowners who spent $1,500 annually for energy in 1983 would spend $2,731 in 2023. Inflation has been consistent, too. Energy prices have risen 106 percent since 2003, 15 percent since 2013 and 43 percent since 2020.
Energy saw an average inflation rate of 12.69 percent since 2020, while the overall inflation rate stood at 5.33 percent. The $1,500 required for home energy in 2020 requires $2,146 this year.
With inflation rampant, homeowners are doing all they can to curb costs — and contractors are helping them. Marcus Shanks of Shanks Plumbing & Heating recently helped with the renovation of a 70-year-old, three-bedroom home in Mendon, Mass.
Shanks worked with Mark Troiano of Emerson Swan and specified the hybrid heat pump water heater from American Standard Water Heaters. The choice came down to efficiency and cost, which was also reduced by a substantial rebate. While inflation might eat into how much food is put on the dinner table, the cost of hot water can be curbed substantially.
The renovation of the ranch-style house covered all the major bases. It included a new roof, electric fixtures, plumbing, water heater and insulation.
The stud-seeking overhaul featured a new kitchen, upgrades to bathrooms, bedrooms and living areas, and cosmetic touches that breathed new life into a structure that sorely needed it. Contractors also installed new insulation, an often overlooked component in maximizing thermal efficiency.
The new look included the heat pump water heater, which delivers hot water throughout the 1,917-square-foot house. “The old system was a very inefficient oil-fired system,’’ Shanks says.
While Mendon might not be large in population — it has slightly more than 6,000 residents — it is within an hour’s drive of Boston, and home prices are soaring. Redfin reported home prices were up 29.7 percent in June compared to 2022 (https://bit.ly/3PS6QXu). The median sale price climbed to $765,500 in June, an increase of more than $250,000 since December 2021.
The updates for the home where Shanks installed the new water heating system helped bring the home closer to the value of other houses in the community.
When selecting a water heating product for the home, efficiency was paramount. The hybrid heat pump water heater was chosen to deliver consistent hot water while offering long-term savings on energy bills.
The product reduces operational costs by up to 75 percent compared to conventional electric storage water heaters. The unit includes I-Memory, a self-learning habit algorithm that ensures the homeowner has hot water when it is needed and energy savings when it isn’t. There are also five operating modes to suit all water heating demands.
“The price point, rebate and efficiency were all important, and it cuts down on the carbon footprint,’’ Shanks notes.
Available in 50-, 65- and 80-gallon capacities, the hybrid unit includes built-in Wi-Fi and leak detection. User-friendly features include an app allowing remote control and monitoring, an LCD display for viewing operational status, parameter changing and diagnostics, a full-flow brass drain valve for quick drainage, factory-installed heat traps to reduce heat loss and a temperature and pressure relief valve.
Hybrid heat pump water heaters are up to 400 percent efficient and offer a critical distinction in that they’re the only form of return-on-investment water heating. For every $1 spent using a hybrid heat pump water heater, owners can realize up to $4 worth of energy into the water.
This efficiency improvement results from collecting existing warm ambient air and transferring that heat energy into the water versus having to create new heat. With traditional electric or gas-fired water heaters, efficiencies range from 60 to 93 percent, which means money is lost with every heat-up cycle.
To incentivize efficiency, the federal government is offering up to a $2,000 rebate for the purchase of select models of water heaters through the Inflation Reduction Act. Combined with local utility incentives/rebates, this is helping the growth of adoption of this green technology. “The leak detection and Wi-Fi capability are great features, but the rebate really entices the sale of the product,’’ Shanks explains.
A Different Direction
More and more contractors — and homeowners — are considering and installing heat pump water heaters.
Tax incentives and rebates can bring down the initial cost, and heat pump technology is also environmentally friendly. Since they do not use much electricity or gas, heat pumps reduce greenhouse emissions. Energystar.gov reports that installing heat pump water heaters across the nation would result in $12 billion in yearly savings (https://bit.ly/48SXOBU). It would also eliminate 140 billion pounds of greenhouse gas emissions annually.
“The options that come with the unit make it very appealing to my customer base and allow them to remotely control the unit based on their preferences,” Shanks notes. “These units are highly sought after in the renovation market. As the focus on efficiency becomes greater, I think we’re going to see more projects similar to this that include heat pumps to help homeowners reduce their costs.”
Thomas Renner writes on building, construction, engineering and other trade industry topics.