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What is a Hybrid Water Heater? How Does It Work?

Fact checked by Stephen Conklin

what is a hybrid water heater

Have you ever heard about heat pump water heaters or asked yourself, what is a hybrid water heater? Hybrid water heaters are as energy-efficient as tankless water heaters and as high-capacity as storage tank systems, giving you the best of both worlds.

However, this water heater type is not for everyone. Learning more about it, how it works, how it compares to other water heater types, and its benefits can help you decide whether a hybrid water heater is worth getting for your home or not.

Let’s find out, shall we?

Table of Contents

What Are Hybrid Water Heaters?


The US Environmental Protection Agency and Energy Star states that a hybrid electric hot water heater is one of the most energy-efficient and cost-effective water heating solutions today. Modern households can enjoy hot water without spending too much.

Known as heat pump water heaters (HPWHs), a hybrid electric water heater marries a tankless water heater’s energy efficiency and a storage tank system’s high hot water capacity for large households.

How Does It Work?

If you are writing hybrid hot water heater mechanism of action, it would be best to look at the average household refrigerator.

Refrigerators pick up heat from inside the unit, move it through coils, and dissipate it in the external environment.

A heat pump water heater works in the opposite direction. It collects heat from the outside environment and channels it to the water heater’s evaporator coils, which contain a refrigerant.

The refrigerant picks up heat molecules into the appliance’s heat exchanger to raise the water temperature to preferred levels.

Hence, you can use the refrigerator analogy to answer the question, how does a hybrid water heater work?

How Does It Compare With Other Water Heater Types?


I mentioned that heat pump water heaters offer the best of both storage tank and tankless water heating systems. Let us examine this further.

Storage Tank Water Heaters

A tank water heater draws cold water into a storage tank, raising the water temperature through gas or electric heating elements.

Gas water heaters rely on propane or natural gas combustion to heat the water. On the other hand, electric heating elements agitate the electrons to cause friction and generate heat.

Tank water heaters store the hot water in large vessels, often 40 to 50 gallons. When someone opens the hot shower, the water heater delivers hot water from the storage tank. Additional cold water enters the tank for heating.

Tankless Water Heaters

Tankless water heaters do not have storage tanks. These appliances heat water passing through coils, either by electricity or gas. That is why many people call tankless water heaters on-demand units because they only heat the water when someone opens a hot water fixture.

Heat Pump Water Heaters

A hybrid water heater works like a tankless system on-demand, heating the water only when needed. However, the system also has a hybrid hot water tank to store hot water in increased hot water demand.

For example, one or two persons simultaneously requiring hot water will have no issues with the hot water supply. The hybrid water heater can function as a tankless unit.

However, if four to five people use hot water simultaneously, a tankless water heater may be insufficient. The hybrid water heater’s integrated tank fills with hot water to accommodate the increased demand.

How Different Is a Hybrid Water Heater from Other Water Heater Types?

The principal difference between a hybrid water heater and the two other heater types is how differently it heats the water.

Storage tank water heaters and tankless systems produce heat either by electricity or gas. On the other hand, a hybrid system does not create heat. Instead, it moves heat from the external environment to the water heater to raise the water temperature level.

What Benefits Can a Hybrid Water Heater Give to Families?

A heat pump water heater moves heat to increase the water temperature, not produce heat. This action gives this water heater type several benefits.

Increased Energy Efficiency

Hybrid water heaters do not create heat; they move it from natural heat sources, such as heat pumps and ambient air. That is why the EPA considers a heat pump water heater more energy efficient because it does not spend energy to create heat.

Increased Cost Effectiveness

You can worry less about the high cost of electricity or gas bills because a hybrid water heater does not need these energy sources to heat the water. Although it still needs electricity to run its controls, it is sufficiently less than what an electric water heater consumes.

Lower Carbon Footprint

Storage tank water heaters and tankless systems use electricity or gas, which has a substantial environmental effect. On the other hand, HPWHs can reduce their carbon footprint by up to two metric tons yearly. Remember, these products draw heat from external sources to heat the water.

Tax Credits

The federal government offers tax credits and rebates to families who install energy-efficient appliances, including a hybrid water heater. This product may cost more than conventional heaters, but the incentives you get will make the investment worthwhile.

Is a Hybrid Water Heater Worth It?

While a hybrid water heater is an energy-efficient and cost-efficient way of heating water, it is not for everybody.

For starters, it requires heat from external sources, mainly the environment. If you live in colder regions, the only heat source the hybrid water heater can draw heat from is the space heating system or furnace. Ideally, the product is perfect for families living in mild to warm climates.

Secondly, installation can be tricky if one switches from an electric unit to a hybrid gas water heater or vice versa because of the required retrofitting.

Thirdly, hybrid water heaters have tanks, making them less appealing to households with limited space.

However, if one lives in a warm climate and with plenty of space in the house, a hybrid water heater is worth every penny you spend on it.


Answering the question, “what is a hybrid water heater?” requires understanding the basic function of storage tank heater systems and tankless water heaters. Hybrid water heaters provide on-demand hot water like tankless units. They also store hot water like tank-type water heating systems.

Hence, hybrid water heaters are more energy-efficient and cost-effective than other types of domestic water heating.

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