Key Takeaways:
For many facilities, quick, consistent access to hot water is essential – but its costs can add up. Per the Energy Information Administration (EIA), water heating for institutional and commercial facilities on average constitutes 5 percent of their energy use, and it tends to be a much bigger item in certain sectors.
Hotels or other lodging facilities use the most, consisting of up to 20 percent of their energy use, followed by restaurants and other foodservice facilities and inpatient medical facilities at 10-15 percent. Other facility types with above average water use include outpatient medical facilities, public assembly (e.g., community centers), schools, public safety (e.g., including jails) and congregations.
As with the HVAC and lighting sectors, the water heater market is seeing exciting technological innovations, leading to significantly more efficient products that can, under the right circumstances, be worthwhile investments for the lifetime savings they provide.
I spoke with Noah Gabriel, senior project manager, Building Innovation at the New Buildings Institute (NBI) about the emerging option of heat pump water heaters (HPWHs) – how they work, their basic technology and key nuances, how to determine if they are a fit for your facility, current research and case studies. NBI describes itself as “a mission-driven nonprofit organization working to advance scalable and practical approaches that equitably eliminate emissions from the built environment,” which includes advancing net zero energy buildings and technology innovations like HPWHs.
While this may sound like a niche issue, NBI has helped build a broad-based coalition of over 100 organizations, the Advanced Water Heating Initiative (AWHI), dedicated to advancing this technology.
HPWHs are based on the same (air source) heat pump technology transforming the HVAC market. Heat pumps pull off the seeming magic trick of providing more energy than you put into them. They are so efficient because they move thermal energy rather than generating it through combustion – hence achieving over 100 percent efficiency by borrowing already existing heat. That heat can be pulled from outside air (even in cold weather) as well as from internal sources – such as restaurant stoves or refrigeration equipment.
The coefficient of performance (COP) is a ratio of the amount of heating or cooling energy delivered versus the electrical energy used by the appliance, and heat pump water heaters are routinely rated at a COP between 2.5 and 4. Though, as Noah pointed out, COP, like miles per gallon (MPG), is a metric tested under laboratory conditions, meaning that real world performance will often lag the metric.
There are increasingly affordable and available HPWHs on the market for smaller commercial buildings, below around 1,000-1,500 gallons per day of hot water use. Ideal applications can include gyms, restaurants, small to mid-size hotels, and community centers. Large commercial buildings and those that need water heated above normal temperatures (think hospitals that must perform sanitization) will require industrial water heaters, which are a separate class where more cost-effective HPWH options are not yet available.
HPWHs have two major components, a water storage tank and a heat pump. Gabriel noted that the market offers the option of models that integrate both functions into a single unit, like one manufacturer’s 120-gallon unitary CHP-120, or split systems with the heat pump outside, like another. The integrated systems need extra space to draw thermal energy from: about 450-700 cubic feet of air for 50-to-80-gallon tanks and around 3,200 cubic feet for 120-gallon units. That may not be a problem unless the unit is stuck in a small, enclosed space like a closet – and even in such a situation, you could add a louvered door to draw air in. But where limited, enclosed space is an issue, a facility manager should opt for a split system.
Many HPWHs are hybrid systems that will provide electric resistance or gas backup as needed for times of especially high hot water demand. Systems should be well-sized to avoid this outcome, with larger water tanks as appropriate.
Operations and maintenance requirements for HPWHs are somewhat different than for traditional water heaters but not particularly unusual. For example, HPWHs produce more condensate water, calling for moisture management measures like drainage pans, proper drainage systems and leak detection alarms. They also need periodic filter replacement, but not that often – in some cases, just once a year. The Energy Star program has a very helpful guide to HPWH installation and O&M – primarily aimed at residences but also relevant to small scale commercial applications.
Expect HPWHs to be more costly than a conventional water heater, often a difference of $1,000 or more plus installation costs. However, since they dramatically cut water heating bills, it is important to calculate lifecycle costs and payback.
Whether and how quickly HPWHs will pencil out for your facility will depend on a range of factors. According to Gabriel, switching from an electric resistance water heater to an HPWH will frequently pay off in a few years. Whether it is worthwhile to switch from a gas water heater to an HPWH will depend largely on the “spark spread,” the difference between the costs of natural gas vs. electricity. As a rule of thumb, if the COP efficiency of the unit is greater than the spark spread, your facility should be able to save money by installing and using the appliance.
Other factors to consider include the level of hot water use and the costs to upgrade electrical systems and spaces to accommodate the unit as needed. While significant tax credits to defray the first costs of residential HPWHs can be found around the country, commercial systems are often excluded from these benefits.
But some states and utilities do provide HPWH incentives to commercial facilities, including California. An example of a facility taking advantage of such incentives is the Spark by Hilton in Redlands, CA. This 85-room hotel installed four fully integrated commercial heat pump water heaters. The 4.3 COP HPWHs will save the hotel a projected $3,000 in electric costs per unit annually. And the specifying engineer for the project praised the ease of installation of the integrated units.
The Advanced Water Heating Initiative cited above is conducting a field study of HPWH performance in 26 small commercial facilities including fast-food restaurants, community centers and offices. The study is designed to yield more detailed information on the energy and cost savings potential of HPHWs across a range of building types, as well as more insight into a number of factors impacting suitability, efficiency and performance of HPWHs in diverse settings.
As long as building occupants expect such amenities as hot showers, clean dishes and laundry, HPWHs will continue to be an ever-hotter item – worth looking into for those whose facilities could benefit from them.
Ken Sandler, Ph.D., is a clean energy and sustainability analyst and thought leader who spent 35 years advancing green building and sustainability policies and programs across the federal government. In addition to being a FacilitiesNet sustainability columnist and Facility Influencer, he writes his own newsletter, Regenerative Futures at LinkedIn and Substack.
