Heat Pump Water Heaters can be a significant investment. It’s natural to try to cut costs by going the Do-It-Yourself route or hiring your handyman. But performing these upgrades is complex. Mistakes can be costly now or down the road. For that reason, we highly recommend to hiring a licensed, insured contractor to do the work correctly. Click here for installation tips and to see available incentives.

A successful electrification project doesn’t just end at installation, getting on the right electric rate and setting your water heater to load shift away from peak times are the key to a successful experience and a requirement to receive your bill credits. Click here for more information on rates and for directions to enroll in a load shift program.

Now that you’ve upgraded your Water Heater and enrolled it into a load-shifting program, you’re ready to apply for bill credits. Here’s what you’ll need:

• A copy of your most recent CleanPowerSF / PG&E bill.

• Proof of your Water Heater Purchase showing a date of purchase or install.

• Photos of your installed heat pump water heater:

  • A photograph of your Water Heater showing model and serial number.

  • A photograph of your Water Heater from 10 feet away.

• Optional submissions (to help with processing):

  • A screenshot of your WatterSaver online dashboard with residential address.

  • Your plumbing permit number. Find it with DBI’s Permit Tracker.

All CleanPowerSF residential customers who replace an electric resistance or gas water heater are eligible for this program.

• A copy of your most recent CleanPowerSF / PG&E bill.

• Proof of your Water Heater purchase showing a date of purchase or install (e.g. Invoice, Receipt, Plumbing Permit).

• Two photos of your heat pump water heater: (1) a photograph of your Water Heater Nameplate showing model and serial number, (2) a photograph of your Water Heater from 10 feet away.

• To expedite your application, we encourage submission of plumbing permit and a screenshot of WatterSaver dashboard.

Yes, self-installed / “do it yourself” heat pump water heater projects qualify for this program. Please note that like all water heater installations, self-installed projects are still required to obtain a permit from the department of building inspection and are only allowed for owner-occupied single-family properties. For more information, you can visit DBI’s website to learn how to apply for a plumbing permit then scroll down to the bottom to read the section titled “Special Cases”.

Unfortunately, if you installed a heat pump water heater before March 15, 2025, you will not be eligible at this time because CleanPowerSF was operating a different Heat Pump Water Heater program.

Unfortunately, they do not qualify. This program is only available for replacement/retrofit projects where the heat pump water heater installed is replacing a gas or electric resistance water heater.

Yes, rental properties qualify for the program but the bill credits will go to whomever is the CleanPowerSF customer (e.g. if the building owner holds the electrical account, the owner is eligible. If the tenant holds the electrical account, the tenant will receive the bill credits. In that scenario, the building owner could encourage their tenant to enroll).

Yes, the Water Heater Upgrade Program is a CleanPowerSF program which delivers incentives through bill credits which are tied to both the physical address of the water heater and the customer account. If you decide to opt out of CleanPowerSF while participating in the Program, your remaining bill credits will be forfeited.

Unfortunately, bill credits are not transferrable so you will no longer receive monthly bill credits if you move from your current address.

This program does not have an end date but will end if available until funding is exhausted. Funding will be distributed on a first-come, first served basis based on the application submittal date.

Our program team is continuously monitoring current and emerging incentive programs to ensure our customers will be eligible for as many financial resources as possible. A list of potential programs is below:

• SF Environment Climate Equity Hub

• Golden State Rebates

• TECH Clean California

• Federal “25C” Tax Credit

• Energy Smart Homes

For more information on the specific program amounts, status, and summary, visit here.

Install costs can vary significantly based on the availability of program incentives and attributes of your home. Based on data from our 2022 to 2025 incentive program, for a standard, 240-volt installation in San Francisco, costs range between $6,000 to $9,000 before incentives. However, there are a variety of programs available to reduce up-front costs including federal tax credits, the Statewide TECH Program, and Golden State Rebates.

Based on our program data, relocation, installation of a 120-volt plug-in water heater, installation of a split-system units, or need for significant electrical work can increase the costs of this upgrade costs.

We highly recommend installing a thermostatic mixing valve (TMV) as part of your installation. A mixing valve works by automatically mixing a bit of cold water into your hot water lines to automatically prevent scalding. This allows the water in your tank to be stored at a higher temperature which acts to increase your overall capacity while preventing any risks of scalding. A thermostatic mixing valve will increase the effective amount of hot water by over 20-percent or the equivalent of 10 to 15 gallons.

Yes, you can use any licensed contractor you’d like for our program. If you want to ensure a contractor familiar with residential electrification, you can review this list of active contractors who have installed heat pump water heaters in San Francisco or a list of water heater contractors from the Switch is On, which lists all contractors who have are eligible for the Statewide Incentive program TECH Clean CA.

Note: These Contractor lists are for informational purposes only and do not represent an endorsement by SFPUC. Make sure to thoroughly vet any contractor.

Enrolling in a Time-Of-Use rate will help you make the most of your new water heater by rewarding you for using less electricity during off-peak hours. Heat pump water heaters work differently and can use its tank as a hot water “battery” to store heat in the middle of the day when there is plenty of low-cost solar electricity available and have hot water available when you need it. The main purpose of the Water Heater Upgrade program is to incentivize you to do just that - to have your water heater do load shifting every day to help keep our electricity costs low, reduce our emissions, and help prevent grid outages.

Which electric rate you are on can have a dramatic influence on your bills and the best rate for you can vary based on whether you have an EV, Solar, Battery, and air conditioning as these can dramatically impact how much electricity you use during peak time and off-peak time.

When considering how adding a heat pump water heater may impact you, EV2 or E-ELEC rate are typically both worth considerations because they have the lowest cost off-peak rates. However, these low off-peak rates come with trade-offs as E-ELEC requires a $15/month charge and EV2 comes with a high-cost peak electric rate.

If your water heater is not currently compatible with WatterSaver but is otherwise eligible, please get in touch with us directly at goelectric@sfwater.org. We’re working with both contractors and the Program administrator at to make sure as many water heaters are eligible as possible.