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Regional Heat Pump Water Heater Market Transformation Program

This program aims to drive the adoption of heat pump water heaters (HPWH) in residential buildings, with legislative and regulatory support from state and local governments. HPWHs offer energy efficiency, load management capabilities, and significant greenhouse gas emissions reduction. The program is designed to establish a uniform program design, leverage early actions to compete for statewide funding, and engage key supply chain actors.

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Regional Heat Pump Water Heater Market Transformation Program

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  1. Regional Heat Pump Water Heater Market Transformation Program May 2019

  2. Growing Momentum for Building Decarbonization • Legislative and regulatory support from state and local government • SB 1477 allocates funding for pilot programs • Residential Heat Pump Water Heaters (HPWH) are win-win

  3. Why Focus on HPWH? • Gas WH are largest source of GHGs in residential building stock (16.9 tons avoided over equipment life) • Load building (~$4,500 of new revenue per HPWH installed) • Super energy-efficient technology MOVES heat, doesn’t create heat (300% efficient or COP 3.0) • Equipment wholesale cost is about $600 more compared to natural gas water heater • Offers load management capabilities through built in or retrofit software Source: Energy Star

  4. Our Objective • Establish uniform program design that can be supported by local energy providers • Demonstrate Bay Area’s political will to scale up HPWH market • Leverage these early actions to successfully compete for statewide funding in 2020+

  5. Key Supply Chain Actor Midstream Actorsinfluence 60% - 90% of all sales

  6. BAAQMD Grant Provides Seed Funding • BayREN team will: • Design single-family midstream incentive • Engage local energy providers (CCAs and POUs) • Engage HPWH supply chain actors • Support workforce education • Homeowner education • Cross-promote with other complementary programs • Layer a HPWH incentive onto BayREN’s Multifamily program • Local Energy Providers: • Funds for incentives and implementation (ongoing)

  7. Benefits to the Region Cumulative 3-Year Impacts Assumes: 13-year useful life; $0.25 per kWh retail electricity price; 1.3 tons of avoided GHG per unit; 1,400 kWh annual unit consumption; natural gas baseline

  8. Pathway to Launch July 2019 April/May 2019 Program Onboarding & Launch Program Design & Development Engage market actors Estimate program potential Present program & obtain feedback Test & refine design with market actors Obtain commitments from local energy providers Onboard distributors & contractors Configure software Customer ready platform

  9. Thank You Jennifer West 510-891-6555 jwest@stopwaste.org

  10. Why a Midstream Program? 900%MORE…. • Programparticipation • Energy & GHG impacts • Customer benefits • Customer touchpoints ††PG&E Commercial HVAC †Efficiency VT HPWH

  11. Midstream Incentive Process 5B. Receives “Thank You” packet CUSTOMER CONTRACTOR 3. Complete application 5A. Reinvest incentive in stocking, upselling, and trainings 2. Stock, promote, sell and ship eligible equipment SUPPLIER 1. Engage CEO/GMs; train sales staff; provide marketing materials & support 4. Verify customer & equipment; pay incentive FAST; send customer packet Implementer

  12. Qualified Contractor Marketplace Facilitate the bid process & steer customers to the best trade allies 754 684 652 Service Marketplace for Trade Allies Contractors Receive Bid Request Installation Complete Products Purchased and Installed Quality Assurance Complete Close-Out Survey Digital Site Survey Generates Project Scope

  13. Sample Program Program Services Supply chain engagement Contractor education & training Turnkey incentive processing Online contractor marketplace Assumes: 13-year useful life; $0.25 per kWh retail electricity price; 1.3 tons of avoided GHG per unit; 1,400 kWh annual unit consumption; natural gas baseline

  14. Distributor Value Proposition: HPWHs 150%

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