We recently covered Tankless Water Heaters. A new product is the Hybrid Water Heater. Like ones from Eternal and GE.  Hybrids have 2 modes of operation. With low flows it has a fixed gas input rate from the preheated water, with higher water needs, it uses a flow sensor like a tankless water heater. GE claims their electric, Energy Star Qualified Geospring Water Heater uses up to 62% less energy than a conventional water heater, and saves $300 a year in energy costs. It has a high energy factor of 2.35. Consumerreports.org has a mini review, their October 2010 print issue has a bigger review.

Hybrid Water Heaters are much higher in efficiency than a regular water heaters, but holds less hot water, usually less than 50 gallons.  Recall that Tankless water heaters may not have the capacity to satisfy multiple water uses at the same time and have issues when temperatures are cold. Energy Star standards are emerging for these new items. These units can be up to 50% more efficient.

Downsides:

1. They are taller, up to 7 feet tall
2. Hybrid water heaters need space to capture uncooled air, upto 1000 sq ft
3. If you do no have a nearby drain, a condensate pump ($150) is needed
4. They are noisier than conventional water heaters

These items are not cheap, they start around $1600 – $2000 for a 50 gallon, 15GPM GE GeoSpring Hybrid Water Heater model. It is projected to have a 56% annual savings, resulting in a short 4.5 year payback time with Federal Tax Credit.  10 year warranty.

The 50 gallon Rheem HP50RH hybrid water heater is slightly cheaper at $1600 – $1750, 58% annual savings, 4 year payback, 10 year warranty.

Most Hybrid Water heaters are covered by the 2010 Federal Energy Tax Credit, so you can save additional money by purchasing it.