U.S. Residential Water Heating Market30 Sep 2011 • by Natalie Aster
Water heating accounts for up to 25 percent of residential energy demand and is the second largest energy use in homes, behind space heating and cooling. The main uses for hot water in residential applications include: showering, bathing, cloth washing, dish washing (faucet/washing machine), and radiant heating.
Each year, about 8 percent of households in the United States replace their water heaters. Roughly 9 million water heaters are replaced in the United States annually and up to 2 million units are installed in new homes.
Residential water heaters supply hot water to almost all of the 79 million single-family homes and approximately 21 million multi-family and manufactured homes in the United States. As some single-family homes contain more than one working water heater, there are approximately 103 million residential water heaters in service nationwide. At least 27 million of these water heaters are more than 10 years old and are, therefore, nearing the end of their functional lives.
There is significant change and transformation taking place in the United States water heating market with rapid shift from standard products to high efficiency products. These products include tankless, heat pump, solar thermal and high efficiency storage water heaters. When added together, the market will be a different environment five years from today, offering more opportunities through high value for the demand and supply side.
The report “U.S. Residential Water Heating Market” by Verify Markets LLC covers market share splits, industry drivers, restraints, unit shipment forecasts and revenue forecasts for the United States Residential Water Heating Market. It includes analysis of the electric tanked, gas tanked, electric tankless, gas tankless and heat pump water heater markets.
Published: September 2010
Price: US$ 4,000.00
Report Sample Abstract
Tankless Water Heaters Market Overview
Tankless, or instantaneous, water heaters are gaining market share in the United States and are already very popular in Asia and Europe. Although the units are still considered a novelty in the United States, they are expected to make inroads into the marketplace as consumer needs grow for additional hot water.
Tankless hot water heater technology started in Europe and China where they use fewer appliances like dishwashers or clothes washers. Tankless water heaters are much faster than tank units at heating water and producing hot water for immediate use on demand. Additionally, tankless water heaters can be very cost effective because, unlike conventional water heaters, they do not have standby losses incurred by continuous use of energy to maintain water in a tank to a set temperature.
Although, theoretically, tankless units provide endless hot water, most provide it more slowly than conventional tank water heaters. This phenomenon limits the number of sources that can draw hot water at one time.
Geographically, tankless units do best on the West coast and the East coast of the United States. There is a major manufacturer represented on each coast, and that is where manufacturers have done most of their marketing in the past.
The most popular whole-house tankless unit, by a wide margin, is the gas tankless water heater. Gas is easier to install, but still requires a plumber to modify the gas lines. It also offers more energy savings. In terms of electric tankless water heaters, the majority of units sold are point-of-use electric water heaters.
Tankless water heaters can be purchased from the manufacturer, distributor, retail consumer discounter, or from a number of resellers on the internet. Since the major retail consumer discount hardware resellers now offer these units on the shelf beside the traditional tank-type water heaters, consumers will become accustomed to them and begin to find applications that utilize the instant and unlimited nature of these devices.
Tankless water heaters are not simple to install, and warranties are not usually honored unless the installation is performed by a qualified installer. The most popular whole-house tankless unit by a wide margin is the gas tankless water heater. Cost to install a tankless unit varies greatly but can range from $2,000 - $4,500.
Tankless units cost significantly more upfront than tank units and require gas plumbing or wiring modifications in the home. These modifications place additional burden on the public gas delivery system. The burden is that tankless gas units burn a huge amount of fuel when heating water at full water flow, which is where they will operate most of the time. Since the volume of gas is high, larger gas inlet pipes are required over standard tank-type water heaters.
Retailers who deal directly with the end-user include Home Depot, Lowes, and Sears. These enduser distributors have a selection of products on hand to meet the typical needs of the consumer, and can arrange for a licensed plumber to install the product on very short notice, usually same day.
Heat Pump Water Heaters Market Overview
Energy consumption and carbon footprint reductions are among the top priorities in the federal agenda, and an increasing environmental stewardship is driving the reduction of energy consumption and carbon footprint in residential water heating equipment.
Heat pump water heaters are electric and use heat in the ambient air to heat the water and exhaust cool dry air back into the living space. These units were first commercially introduced in 2009, lead by GE and followed by others such as Stiebel Eltron, Bosch, Rheem and A.O. Smith. GE in particular has done an excellent job at promoting and advertising this technology.
The high efficiency of heat pumps, in addition to federal and state incentives, has made these systems very attractive for the end-user. These units are the only type of electric water heater that earn the EnergyStar certification. This certification means the installed price can be offset by a 30 percent federal tax credit ($1,500 cap) as well as tax rebates and other state and local incentives.
Despite their higher initial costs, these units provide capital payback in two to three years. Furthermore, the Department of Energy (DOE) requires that by 2015, any residential water heaters with capacities over 55 gallons will require the use of a heat pump water heater. Today, 10% of all electric water heaters sold fit the DOE criteria. However, even though prices for heat pump water heaters have already reduced dramatically, they are still far from being priced competitively. Despite the 2015 legislative mandate from the DOE, at a cost $1,500 for a heat pump water heater, consumer might opt to install two regular 40 gallon heaters at $300 each instead of a 55 gallon heat pump water heater.
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