Grid-Interactive Water Heater Market

The global Grid-Interactive Water Heater Market is valued at USD 276 Million in 2023 and is projected to reach a value of USD 402.4 Million by 2032 at a CAGR (Compound Annual Growth Rate) of 4.3% between 2024 and 2032.

Key Highlights of Grid-Interactive Water Heater Market

• North America generated more than 36.2% of revenue share in 2023
• Asia Pacific is expected to grow at the quickest rate from 2024 to 2032
• In 2023, 80 Gallon Capacities segment dominated the global market growth
• The Residential segment revealed the most significant market share in 2023, i.e., 55.2% of revenue
• Growing consumer environmental awareness contributes to the demand for sustainable technologies, aligning with the global trend towards eco-friendly solutions. Moreover, the increasing consumer demand for comfort and convenience in homes is positioning grid-interactive water heaters as essential components, ensuring a reliable and consistent supply of hot water

Grid-Interactive Water Heater Market: Regional Overview

The North America Grid-Interactive Water Heater market showed significant dominance, with 36.2% of the market share in 2023. This is due to North American consumers' strong demand for energy efficiency and sustainability, actively seeking ways to reduce their carbon footprint. Grid-Interactive Water Heater provide a solution using smart technology to optimize energy usage and seamlessly integrate with renewable energy sources. Furthermore, the region's increasing adoption of smart home technology further cements its market superiority, as Grid-Interactive Water Heater is a key component of smart home systems that offer remote control and programmable features to promote cost-effective electricity usage.

U.S. Grid-Interactive Water Heater Market Overview

The Grid-Interactive Water Heater market in the United States, with a valuation of USD 143 Million in 2023, is projected to reach around USD 179 Million by 2032. This forecast indicates a substantial Compound Annual Growth Rate (CAGR) of 2.5% from 2024 to 2032. In the United States, water heating accounts for around 19% of the total energy consumption in homes, making it the second largest single-end user of energy after space heating.

The global Grid-Interactive Water Heater market can be categorized as Product, Application, and Region.

Grid-Interactive Water Heater Market: Product Overview

In 2023, there was remarkable growth in the 80 Gallon Capacities segment. Based on the Product, the Grid-Interactive Water Heater market is categorized into 80 Gallon Capacities, 100 Gallon Capacities, 119 Gallon Capacities, and Others. The 80 Gallon Capacities segment is dominating the global market due to the high demand from residential customers demonstrates the popularity of 80-gallon water heaters, which are ideal for typical families as they offer ample hot water without being excessively large or expensive. Moreover, the availability of a broad range of Grid-Interactive Water Heater in this size category allows consumers to choose based on their budget and specific requirements. Additionally, the increasing adoption of grid-interactive technologies in the residential sector, like smart thermostats and solar panels, drives the demand for Grid-Interactive Water Heater.

Grid-Interactive Water Heater Market: Application Overview

In 2023, substantial expansion was observed in the global Grid-Interactive Water Heater market within the Residential category with 55.2% of market share. The application segment is divided into Residential and Non-Residential. The rise in demand for energy efficiency and sustainability in homes has led to the adoption of Grid-Interactive Water Heater. These water heaters utilize smart technology to optimize energy consumption and integrate seamlessly with renewable energy sources. The widespread use of smart home technology also contributes to the dominance of Grid-Interactive Water Heater in residential settings. These water heaters are an essential component of smart home systems, offering features such as remote control and programmability to ensure cost-effective electricity usage and take advantage of renewable energy availability.

Top Market Trends

• Increasing demand for energy efficiency and sustainability: There is a growing demand among consumers and businesses to decrease energy usage and minimize environmental harm. A solution to meet these objectives is Grid-Interactive Water Heater, which utilize intelligent technology to maximize energy efficiency and seamlessly integrate with renewable energy options.
• Growing adoption of smart home technology: Grid-Interactive Water Heater is an essential element of numerous smart home systems as the demand for smart home technology continues to rise. These intelligent water heaters offer remote control capabilities and the ability to schedule water heating during periods of low-cost electricity or when renewable energy sources are abundant.
• Growing demand for decentralized energy resources: The popularity of decentralized energy resources, like solar panels and battery storage, is growing. A more dependable and robust energy supply can be achieved by integrating Grid-Interactive Water Heater with these resources.
• Rising demand for demand response services: Grid-Interactive Water Heater can contribute to demand response programs. These programs enable utilities to decrease energy usage when demand is highest. By heating water during periods of lower demand and storing the hot water, these water heaters can be operated during peak periods.

Premium Insights

The growth of the Grid-Interactive Water Heater market is driven by the rising focus on energy efficiency and sustainability, as consumers and businesses seek solutions that optimize energy usage and integrate renewable sources. The adoption of smart home technologies is also playing a significant role, as Grid-Interactive Water Heater is becoming essential components of these systems, offering remote control and programmable features for cost-effective electricity usage. Government support, in the form of financial incentives, tax credits, and research funding, is further fueling market expansion. Rising energy costs also push consumers to invest in energy-efficient technologies like Grid-Interactive Water Heater to reduce expenses.

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Market Dynamics

Shifted Energy entered into a contract to integrate its cutting-edge Grid-Interactive Water Heater (GIWH) into the developing grid services market of Hawaiian Electric Company. This collaboration is part of a Grid Services Purchase Agreement facilitated by Open Access Technology International, Inc. (OATI), the foremost provider of software-as-a-service for grid operations in North America. Shifted Energy is set to deploy up to 2,400 Grid-Interactive Water Heater (GIWH) systems across Oahu and Maui, concentrating on challenging-to-reach demographics, including low- and moderate-income individuals, apartment residents, and renters. Operating under a five-year agreement in 2020, these GIWH systems collectively form a 2.5-megawatt virtual power plant (VPP), marking one of the most substantial competitively sourced GIWH implementations globally.

Itron Inc., a provider of innovative energy and water management solutions for utilities and cities, has successfully launched the Grid-Interactive Water Heater program in Fort Collins Utilities, which provides electricity, water, wastewater, and Stormwater services to over 75 000 customers within the city of Fort Collins, CO. For the majority of residential customers, electric hot water heaters are second to air conditioners in their electricity consumption. Pre-heating water before periods of high electric demand can significantly decrease the electricity expenses of participating residential customers during peak hours, with potential savings ranging from 15 to 20%, achieved by shifting the activity to non-peak hours.

Competitive Landscape

The Fire Alarm Equipment (FAS) market is highly competitive, with key players engaging in various strategic initiatives to establish dominance in this growing sector. The market's competitive dynamics are also influenced by the ever-increasing demand for sustainable and energy-efficient solutions, leading companies to invest in research and development for cutting-edge technologies. As consumers place greater emphasis on energy efficiency and environmental impact, companies that offer reliable and technologically advanced Grid-Interactive Water Heater have an advantage in this evolving market.

Recent Market Developments

· In 2022, By the end of 2025, the WatterSaver pilot is anticipated to become the biggest initiative in the United States of its kind, catering to approximately 9,000 eligible customers. Its objective is to achieve a peak load reduction of up to 2.5MW.

· In June 2023, Itron Inc., a company revolutionizing energy and water management for utilities and municipalities, declared the effective implementation of a program for grid-connected water heaters in collaboration with Fort Collins Utilities. This initiative serves over 75,000 customers in Fort Collins, Colorado, offering electricity, water, wastewater, and stormwater services.