Benefits of heat pumps for Southwest homes 2022 STUDY

In our analysis, we compared the life-cycle costs for the above scenarios, over a 15-year life of the equipment for the heat pump.28 The life-cycle costs include the initial installed costs of the equipment, and the net present value (NPV) of the 15-year fuel costs for heating. [...] 29 The purpose of including the social cost of carbon and methane is to account for additional benefits associated with the heat pump, and to help determine what level of utility rebates for the heat pump can be justified to help it be cost neutral compared with the conventional heating systems. [...] Also note that for an all-electric new home, the avoided cost of the gas piping to the home will also help offset the incremental costs for the heat pump and HPWH. [...] The annual heating costs will be about the same, as shown in Table 17.45 However, the incremental initial costs will be significantly higher for the all-electric retrofit compared to the dual-fuel retrofit, because of the higher cost of the cold-climate heat pump systems compared to a 2-stage heat pump, plus the costs of duct system improvements. [...] For the all-electric configurations, the heat pump system was set to have the backup electric strip 39 heating elements cycle on when necessary to supplement the heat pump, while minimizing the use of the electric strip heating to reduce the annual heating costs.