In Canada, the adoption of decarbonized water heaters is on a faster trajectory. Across Canada, carbon emissions are taxed at an increasing rate, per ton of CO2 emissions. Vancouver is an example of a city that is phasing out natural gas service to new buildings. Essentially, the status quo of consuming fossil fuel-based energy for DHW will be increasingly expensive. The policies currently in effect, or on the horizon, will require consumers to either pay the carbon tax or pay to install more energy-efficient water heating systems.
From a policy perspective, there is a parallel in the U.S. automotive industry. Federal and state energy-efficiency standards are pushing car and truck manufacturers to increase the average miles-per-gallon of gasoline efficiency in their fleets. Most major car companies are phasing in hybrid gas/electric and all electric automobiles quickly, as a way to comply with these benchmarks.
While energy policy is likely not the major decision point for automobile buyers, increased competition in the electric car segment has led to an increased number of less-expensive options for electric vehicles, spurring competition. According to the Edison Electric Institute, in the U.S., “It took eight years to sell 1 million electric vehicles and fewer than three years to sell the next million.” Time will tell if policy-driven decisions will push HPWHs to a similar adoption trajectory.
Not all jurisdictions are pushing for decarbonization. According to the American Council for an Energy-Efficient Economy, in some U.S. States, consumers are discouraged from disconnecting their current gas service. The rationale is often related to concerns that shifting gas water heaters to electric would increase the potential for brownouts within an already overloaded electrical grid. As an example, a utility company may be forbidden from providing financial incentives to customers who want to disconnect gas service and switch to electric-resistance heating, cooling and water heating technologies unless specific criteria are met.