Return on Investment for a Hot Water Heat Pump

The single best thing for many households to do….. is install a hot water heat pump.


A 300 litre hot water cylinder requires 15kWhrs of energy to heat it.
Assuming electricty is 25c per kWhr, the cost per day is $4 (to make things easy).
A heat pump will save 10 kWhrs a day (more in summer, less in winter), hence each cylinder of hot water will represent a saving of $2.50.
For a complete year, that's over $900.
Many families will use a cylinder of hot water each day.

Another way of looking at it.

The actual savings will depend on the number of people in a house, and obviously how much hot water they use individually.
Our calculation show savings could be $200 to $250 per person per year.
Hence a family of five could save over $1000 a year, similar to the figures above.

Another way...

If a hot water heat pump costs $4000 to install, the rate of return will be say 5% per person per year.
(5% of $4000 being $200).
Hence 4 people will have a tax free rate of return (also completely risk free) of 20%.
Teenagers will simply result in more savings.

Larger users of hot water

Interesting things happen with, motels, hotels and schools etc. One recent project, fitting a heat pump to a 750 litre cylinder, has produced savings of hundreds of dollars a month...easy money!

Further savings.

Further savings can be made when a hot water heat pump is combined with solar PV. But note that a solar PV system will not provide the same rate of return as a heat pump.


So… The single best thing for many households to do….. is install a hot water heat pump. 

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