The short answer
A heat pump water heater saves a family of 4 about $518.56 a year over a standard electric tank at the U.S. average rate of 18.16¢ per kWh (August 2026): $200.45 against $719.01. At $1,500 more installed it pays back in 2.9 years.
The same household in every state
4 people, 120°F setting, each state's cold-water estimate and average rate (August 2026); payback once you type the extra cost.
| Alabama | $442.99 | — | 16.33¢ |
|---|---|---|---|
| Alaska | $1,105.74 | — | 29.41¢ |
| Arizona | $293.66 | — | 15.05¢ |
| Arkansas | $369.30 | — | 14.37¢ |
| California | $750.40 | — | 29.75¢ |
| Colorado | $547.49 | — | 17.17¢ |
| Connecticut | $746.54 | — | 24.51¢ |
| Delaware | $542.88 | — | 18.70¢ |
| District of Columbia | $717.13 | — | 25.98¢ |
| Florida | $321.03 | — | 14.99¢ |
| Georgia | $416.19 | — | 15.90¢ |
| Hawaii | $898.15 | — | 47.18¢ |
| Idaho | $407.23 | — | 13.37¢ |
| Illinois | $588.46 | — | 19.32¢ |
| Indiana | $510.31 | — | 17.02¢ |
| Iowa | $543.98 | — | 17.06¢ |
| Kansas | $434.38 | — | 15.47¢ |
| Kentucky | $387.49 | — | 13.80¢ |
| Louisiana | $281.75 | — | 12.87¢ |
| Maine | $1,054.44 | — | 32.11¢ |
| Maryland | $611.08 | — | 21.40¢ |
| Massachusetts | $942.89 | — | 30.48¢ |
| Michigan | $711.19 | — | 22.99¢ |
| Minnesota | $573.00 | — | 17.20¢ |
| Mississippi | $350.24 | — | 14.43¢ |
| Missouri | $465.08 | — | 16.02¢ |
| Montana | $511.29 | — | 15.57¢ |
| Nebraska | $412.41 | — | 13.54¢ |
| Nevada | $284.52 | — | 12.72¢ |
| New Hampshire | $868.19 | — | 27.64¢ |
| New Jersey | $714.45 | — | 24.61¢ |
| New Mexico | $463.59 | — | 16.51¢ |
| New York | $831.74 | — | 28.65¢ |
| North Carolina | $391.32 | — | 14.95¢ |
| North Dakota | $468.75 | — | 13.31¢ |
| Ohio | $581.07 | — | 19.38¢ |
| Oklahoma | $394.97 | — | 14.82¢ |
| Oregon | $469.75 | — | 15.92¢ |
| Pennsylvania | $621.64 | — | 21.77¢ |
| Rhode Island | $898.56 | — | 28.18¢ |
| South Carolina | $382.52 | — | 15.76¢ |
| South Dakota | $497.50 | — | 15.15¢ |
| Tennessee | $357.66 | — | 13.42¢ |
| Texas | $348.30 | — | 15.91¢ |
| Utah | $392.74 | — | 13.31¢ |
| Vermont | $782.86 | — | 23.84¢ |
| Virginia | $470.13 | — | 17.64¢ |
| Washington | $445.61 | — | 14.63¢ |
| West Virginia | $473.49 | — | 16.31¢ |
| Wisconsin | $618.92 | — | 19.41¢ |
| Wyoming | $480.72 | — | 14.43¢ |
How it works
The formula
kWh a year = heat × 365 ÷ UEF ÷ 3,412 · saved = (electric − heat pump) × rate
Assumptions
- The same model as our water heater cost calculator: hot water a day by household from a Florida Solar Energy Center study; UEF 0.92 for an electric tank (the federal minimum for 50 gallons) and 3.3 for a heat pump (ENERGY STAR's minimum).
- Cold water is estimated from the average air temperature at your state's largest city's airport plus 2°F, close to shallow groundwater (NOAA, 2015-2024). Type your own if you know it.
- Heat pump models run their backup element in cold spaces or at high demand, which cuts the savings.
Worked example: family of 4
- Electric tank: 3,959 kWh = $719.01 a year
- Heat pump: 1,104 kWh = $200.45
- $518.56 saved; $1,500 more pays back in 2.9 years
Ways to cut the cost
- Check rebates first: many utilities and states offer them for heat pump water heaters.
- Put it in a big, warm space: it needs air around it and works best above about 50°F.
- Use heat pump-only mode when you can; hybrid and high-demand modes use the electric element.
Questions people ask
How much does a heat pump water heater save?
For a family of 4 using 68 gallons of hot water a day, about $518.56 a year over a standard electric tank at the U.S. average of 18.16¢ per kWh (EIA, August 2026). It uses 28% of the electricity. For 2 people the saving is $335.54.
Is a heat pump water heater worth it?
It depends on the price difference. If it costs $1,500 more installed, the family of 4 gets it back in 2.9 years at the U.S. average rate; faster in states with high rates or cold water, slower where power is cheap. Utility rebates can cut the difference a lot.
Does it work in a cold basement or garage?
It pulls heat from the air around it, so it works best in a space that stays above about 40 to 50°F, and it cools and dries that space as it runs. Below that, most switch to their backup electric element and save less.
What about against gas?
Compare on the water heater cost calculator, which shows gas, propane, electric and heat pump models at your state's prices.