Why you should electrify your hot water even while the grid isn't 100% renewable

There are lots of reasons why we should efficiently electrify our homes.

The big picture driver is climate change or, as the UN head has said recently, ‘global boiling’. This is driven not by our annual emissions, but by the concentration of greenhouse gases in the atmosphere, which is near double the pre-industrial level.

Those gases re-radiate heat back to Earth that should have escaped to space. The laws of physics mean that the only way the Earth can restore its thermal balance is by heating up, so the bigger temperature difference between it and space drives more heat loss – just as heating a home to a higher temperature means more heat is lost to the environment. While the concentration of greenhouse gases remains high, earth will be hot.  

This means that the sooner we can cut emissions and remove greenhouse gases from the atmosphere, the less additional heating, with all its consequences, will occur.

Delaying action in the hope that silver bullets like renewable hydrogen will become viable simply adds to our problems and the risk of climate calamity.

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We need efficient electric equipment like heat pumps

Energy efficiency and efficient electrification using renewable energy sources are practical, economic options now. We need to embrace them as fast as we can.

It's true that our present emission intensity of electricity is still fairly high, so switching from gas today may not cut present day emissions by much, if at all today but, over time big emission reductions will occur.

However, efficient electric equipment can already make a difference – and cut energy costs, especially if it is linked to disconnecting from gas and avoiding related fixed daily charges. Rapid adoption of renewable electricity in the grid, as well as rooftop solar, is driving down emissions from electricity, with a government target of 82 percent renewables by 2030.

The graph below shows the results of my analysis of options for household hot water supply using today’s carbon intensity values, which is a measure of how clean our electricity is. It also shows the impact of a more efficient heat pump and the emissions from an efficient (high COP) heat pump in 2030, when electricity emission intensity will be much lower.

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This comparison graph factors in standby heat losses from storage tanks and pilot lights, as well as start-up losses of instantaneous gas units. The initial emission intensities reflect values in the 2022 National Greenhouse Factors Workbook. The emission intensity of gas applies to Victoria: it can be higher in other states, especially NSW.  

Victoria’s brown coal-fired electricity means its emission intensity is higher than the national average. Clearly, if you run your heat pump hot water system (HWS) mainly on rooftop solar, emissions will be lower.

Comparing the emissions of Victoria and national emissions from heat pumps in 2022, against the 2030 line shows that, within the lifetime of a new hot water service, electric heat pumps will generate much lower emissions than gas.

The efficiency of a heat pump water heater is typically measured by its coefficient of performance (COP), which is the ratio of the heat output to the electricity input.

Heat pumps with a COP of 3 produce three units of heat for each unit of electricity – 300 percent efficiency! Some models have much higher COPs and save much more.

The graph below shows the lifetime emissions for different hot water systems over a 13 year period from 2022. It assumes electricity emission intensity drops linearly so that in 2030, 80% of electricity is from renewables and that this trend continues until 2035.

The graphs also show that the efficiency of the heat pump can make a big difference to emissions, and lower hot water consumption also matters a lot.

Running your heat pump on rooftop solar will drop emissions to near 2030 grid electricity emissions or lower.

Running a heat pump at warmer times of the day improves its efficiency, while a smaller or better insulated storage tank also reduces energy losses and cuts emissions.

The efficiency of an instantaneous gas hot water system can be quite high at low levels of hot water usage, as it doesn’t have the continuous heat losses from a tank or a pilot light that a storage unit has.

It is clear that, over the life of the hot water service, a new heat pump HWS will have lower emissions than a gas HWS over a wide range of daily hot water consumption and in all parts of Australia.

The financial outcome is more complex, as it depends on the level of government incentives in your state, the carbon intensity of the electricity you consume, the time of day when you run your heat pump HWS, the price of the product you choose, and whether you run it on rooftop solar electricity.

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BUT be wary of manufacturers efficiency claims

Heat pump hot water systems are generally highly energy-efficient compared to traditional electric resistance water heaters but it is a pity that heat pump manufacturers use coefficient of performance (COP) to measure energy efficiency, instead of percentage efficiency.  

A heat pump with a COP of 3 has 300% efficiency, but many people won’t know how to compare this COP to claims of the ‘amazing 100% efficiency of an electric fan heater or radiator’!

Also, few realise the significance of even a small change in the temperature difference across a heat pump or aircon.

Unfortunately, manufacturer claims about high COPs must be carefully evaluated, as we have no effective Standards for reporting.

The efficiency of a heat pump hot water system (HWS) is higher when it operates in a warmer environment. For just one degree reduction in temperature difference, efficiency can improve by 2 to 3%. Some manufacturers state COPs at over 30C operating conditions while others use more realistic ambient temperatures of 15 to 20C.

A product with a COP of 6 at 30C could have a much lower COP at 15C. Some products maintain higher COPs at low temperatures than others. So COP comparisons involve apples and oranges.

The consumer group Choice recently (16 May 2023) published a table of 51 heat pump hotwater products using publicly available data. This showed that different manufacturers made COP claims at very different operating temperatures. So claims are not comparable.

Choice also did not include information on the number of Small Technology Certificates (STCs) each product is eligible for.

Buyers of heat pump hot water units receive an up-front incentive payment based on the number of Small Technology Certificates (STCs) they receive from the Clean Energy Regulator. The number of STCs awarded is based on fairly sophisticated computer modelling of their energy savings based on a typical daily hot water usage pattern and historical hourly temperature data, and an assumed daily usage of around 200 litres of hot water.

While we can debate how realistic this method of assessing efficiency is, it is at least consistent and representative of the outcome for a 4-person household in each of 5 climate zones.

I selected 10 products from the Choice table and compared the manufacturers’ claimed COPs for their products with the number of STCs awarded in each of 5 climate zones, trying to represent the range of refrigerants and performance.

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Although my choices aren't necessarily representative, it does show that manufacturers who made claims for high COPs at high operating temperatures looked much more impressive than the outcomes suggested by their Small Technology Certificates.

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This analysis suggests that you should ignore claims about COPs, and use the (imperfect) number of STCs awarded when comparing performance.

A COP measured at 30C may look a lot better than a COP measured at 20C, but it does not necessarily lead to bigger energy, emission, or cost savings. And some products maintain higher performance at colder temperatures than others.

Many manufacturers do not state the number of STCs their product scores. So consumers have to dive into the user-unfriendly database of the Clean Energy Regulator to access STC data.

Governments have failed consumers.