Can a Heat Pump Help You Save?

Can a heat pump help you save? 

Yes! Heat pump technology is one of the most efficient ways to heat water and heat and cool your home. PG&E residential customers can save about 20% on their utility bills—up to $78 a month—by switching from gas or regular electric appliances to heat pump systems for home heating and cooling and water heating*.

Heat pumps help you manage energy use while making your home more comfortable. Here’s how…

How does heat pump technology work?

Heat pump space heating and air conditioning units work by extracting heat from the air and sending it where it is needed—or not needed.

●       In the winter, heat is pulled from outside air and brought inside to heat our homes.

●       In the summer, heat is pulled from the air inside our homes and exhausted outside to cool our homes.

Even if the outside air feels cold to us, heat pumps can still extract heat from it. Conventional heaters must generate heat by burning fossil fuels or by using electrical resistance heating elements.

Because heat pumps don’t have to create new heat, they are more energy efficient.

The technology works similarly in heat pump water heaters. The heat pulled from the air is transferred to water in a storage tank. The heated water is then available for use.

Heat pump clothes dryers use heat from the air to remove moisture from clothes. They then recycle and reuse the heated air instead of venting the hot, moist air outside.

How can heat pumps help you save?

• More efficient space heating. Electric heat pumps are up to four times more efficient at heating your home. They can also reduce heating energy use by 75% compared to standard heating, like a furnace.

• Removes the need for a separate air conditioner. A heat pump’s reversing valve lets it function as either a heating or air-conditioning unit. Heat pumps also dehumidify air better than air-conditioning units - this reduces the amount of energy needed to cool a home.

• More efficient water heating. Heat pump water heaters use about 70% less energy than standard electric or gas water heaters. They can also offer control options to improve hot water production and energy usage based on how much hot water is needed and how soon.

• More efficient clothes drying. A heat pump dryer can reduce energy usage by an extra 28% compared to standard, electric dryers. It also dries laundry at a lower temperature, which is gentler on clothes.

Heat pumps can also help lower your carbon emissions and support a sustainable home.

Are there rebates and incentives?

There are tax credits, incentives and rebates that can help lower the cost of buying and installing heat pumps. Plan your home upgrades now before federal tax credits expire in December.  Visit SwitchIsOn.org for savings in your area.

Ready to learn more? Check out our guide to heat pump water heaters or explore how electric technologies can benefit your home at pge.com/electrification.

About the Author

Helen Liu is a PG&E Building Electrification expert program manager, who specializes in heat pumps and energy efficiency.

*Disclaimer: This estimate is based on an analysis using the Fixed Charge Design and Bill Impacts Model prepared for California Public Utilities Commission (CPUC) by Energy Environmental Economics (E3), Inc. in April 2023. It considers customers transitioning from Time-of-Use to Electric Home rate plan. The potential savings will vary depending on the customer’s location, energy use, enrollment in PG&E programs, and current rates in effect.