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February 18, 2013

Buy a $999 Water Heater, Get $1050 Back?

Filed under: Electronics,Retail — Edgar (aka MrConsumer) @ 6:04 am

The ad seemed too good to be true: Buy a new-fangled GE Geospring Hybrid Water Heater for $999, and get back a $750 cash rebate, plus a $300 federal tax credit:

GE Water Heater

Surely, this neighborhood appliance store is hiding something critical like you have to buy a furnace too.

*MOUSE PRINT:

None!

Well, there is a ton of paperwork and fine print (like what type of heater it must replace, and where you are putting it), but the offer as stated is valid in Massachusetts through participating utility companies. And similar but not always as generous rebates are available in other states too.

Utility companies across the country are trying to promote the installation of energy efficient appliances, and providing rebates for that purpose is a big incentive for consumers. The federal government also has a $300 tax credit for an actual dollar-for-dollar reduction in your federal tax bill when you install certain energy efficient products. (You are only allowed up to $500 in these federal tax credits, so if you have already used them up on say energy efficient windows, you cannot get an additional credit for these water heaters.)

To see what rebate, if any, applies to the purchase of a super energy efficient water heater, use this lookup from GE. It will tell you how much you can qualify for both in state and federal programs.

These programs are not limited to GE brand super efficient water heaters, so do compare features of other brands. Because this type of water heater uses principles of a heat pump, GE says it can save you $325 a year. Are the savings claims true? Consumer Reports tested an older model a few years ago, and did find significant energy savings year after year. You can do your own calculation here based on local electric rates to see what your savings might be. Here is general information about this heater.

Remember, of course, that you will have to pay for installation by a licensed plumber. And, the $999 sale price for the GE hot water heater appears to end on February 20.

The moral of the story: if an offer sounds too good to be true, on rare occasion, it may be the deal of a lifetime.

• • •

6 Comments

  1. I guess its tough to complain about how good a deal this is, but I would think by now energy efficient water heaters would be a normal purchase and not one that needs to be incentivized. I would certainly invest in one if I knew that the savings would add up over time.

    A nice surprising actual deal instead of a deception.

    Comment by Wayne R — February 18, 2013 @ 9:06 am
  2. Well Wayne if they were cheap enough to begin with they could be a standard purchase. They are still like 3 times the cost of a regular heater.

    Even If I could not get the Federal tax credit the 750 in savings plus the cost of the plumber to install it would still save me money over the old school model to install.

    Comment by Richard Ginn — February 18, 2013 @ 1:25 pm
  3. I’m a little puzzled by the concept here. The water heater partially heats the water by drawing heat from the surrounding air. That will make the surrounding air cooler. If the heater is located inside the house, then it is acting like an air conditioner in whatever space it is installed in. That’s fine in the summer when the cooling effect will supplement the home A/C system but in the winter, the primary heating system will have to replace the heat energy consumed by the water heater. If the home is heated with electrical resistance heating, there will be no net energy saving in the winter. If the home is heated with a heat pump, natural gas, or oil, the savings will be the difference between the cost of electrically heating the water (standard water tank) and the cost of providing the same amount of heat energy by the primary heating system. This system would probably make the most sense in a hot climate like Florida and the least sense in a cold climate like Alaska!

    Comment by John — February 18, 2013 @ 4:44 pm
  4. Sounds good, but having a plumber install it and having to pay to take the old one away negates the savings. I have a friend who knows plumbing and he installed my new water heater so I could not claim a credit. He couldn’t afford to keep up his plumber’s license. My father did all his plumbing himself.

    Comment by Liz Pakula — February 18, 2013 @ 7:13 pm
  5. Wow! I just checked for Houston, and unfortunately there is only the $300 federal rebate (though still a good deal for people who need to replace their water heater).

    Comment by Amanda L Grossman — February 18, 2013 @ 8:24 pm
  6. Unless you really need a new water heater, consider adding insulation to the existing one instead. Your utility company may offer coupons/rebates towards water heater blankets that anyone can install, all you’d need is a pair of scissors. Mine did. Got a $10 coupon towards a $25 blanket. Was pleased then, still am.

    Comment by anonymous — February 20, 2013 @ 5:15 pm

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