Participants established their eligibility to compete by demonstrating technical capability, manufacturing capacity, and market reach.
Outcome: Approved manufacturers advanced to Phase B to develop full project plans.
Accelerating the Future of Water Heating
Midea has been selected as the winner for its compact split-system heat pump water heater concept designed to address common space and installation barriers in multifamily retrofits.
Led by the Northwest Energy Efficiency Alliance (NEEA), the Hot Water Innovation Prize challenged manufacturers to accelerate the development of affordable, easy-to-install split-system heat pump water heaters for space-constrained applications.
The Prize focused on practical, market-ready systems that pair an indoor tank with an outdoor compressor. This configuration can help bring high-efficiency water heating to apartments, multifamily buildings and homes where conventional heat pump water heaters may not fit.
Our Co-Sponsors
Meet the Winner
Midea has been selected as the winner of the Hot Water Innovation Prize for its development of a compact, high-efficiency split-system heat pump water heater designed for multifamily building retrofits.
The winning design addresses one of the most persistent barriers to heat pump water heater adoption: finding sufficient indoor space for the equipment. By pairing a compact indoor tank with an outdoor compressor, the system is designed to bring efficient water heating to apartments and other space-constrained installations where conventional heat pump water heaters may not fit.
The selection marks an important milestone, but the work is not finished. The next phase of the Prize will focus on product development, field demonstrations and collaboration with utilities and industry partners to prepare the technology for broader market adoption.
Why it Matters
Water heating is one of the largest energy uses in U.S. homes, but affordable and energy-efficient options are unavailable for compact spaces today. Small-capacity split system heat pump water heaters would solve this problem and extend efficiency benefits to people living in homes and apartments where more modest electric resistance water heaters are commonly found.
Focused on Efficiency
The Prize focuses on smaller (e.g., 35-gallon) split systems because they extend efficiency benefits to smaller or space-constrained homes, including apartments in multifamily buildings. NEEA estimates these systems can reduce water-heating electricity use by up to 60%, saving individual households hundreds of dollars annually while significantly lowering emissions. Split system heat pump water heaters represent a major market opportunity, with 1 to 2.4 million units in potential annual sales.
Utilities and Program Co-sponsors
Preparing for the Next Generation of Water Heating
Utilities and energy-efficiency organizations have a unique opportunity to help move this technology from lab to field.
We invite utilities and other program-focused organizations to join the national effort to promote winning designs from the Hot Water Innovation Prize. We invite you to join our Co-sponsors, Bonneville Power Administration, New Buildings Institute, Vermont Energy Investment Corporation, and Efficiency Vermont, in leading demonstrations of winning products. Co-sponsors are also invited to launch early utility incentive pilots beginning in 2027. These efforts will provide valuable data on performance, installation, and customer satisfaction, laying the groundwork for broader adoption.
Interested utilities and program sponsors can contact us to explore collaboration opportunities.
Demonstration Project Co-sponsors
Media Co-sponsors
Help Amplify the Future of Water Heating
Industry associations, trade groups, nonprofits, and media outlets were invited to join as Media Co-sponsors. These communications partners play an important role by sharing updates, stories, and results through their communication channels, like newsletters, events, and social media.
Media Co-sponsors
The Hot Water Innovation Prize
How the Contest Works
The Hot Water Innovation Prize is structured around three stages that guide promising ideas from concept to market-ready products.
Contest Details
Midea has been selected as the winner of the Hot Water Innovation Prize. The Prize will now move into its next phase, supporting continued product development, demonstration projects, utility pilot programs and industry education.
Three Contest Phases
Phase A
2024
Participant Qualification
Phase B
2025
Project Plan Submission
Qualified manufacturers submitted 10-page project plans outlining their product designs, production strategies, and launch roadmaps.
Outcome: Up to five manufacturers each received $30,000 in co-funding and advanced to prototype development.
Phase C
2026
Prototype Submission
Selected manufacturers built and tested working prototypes of split system heat pump water heaters to demonstrate performance and affordability.
Outcome: Midea was selected as the 2026 Hot Water Innovation Prize winner and will receive $175,000 to support continued product development.
Resources
- Hot Water Innovation Prize Flyer
- Guidebook and Rules
- FAQs
- Phase A Launch Webinar Recording (10/2/24)
- Supplemental Guidance on Cost-Effectiveness Guidebook & Rules
- Seasonal Coefficient of Performance (SCOP) Calculator
- Manufacturers Webinar
- Manufacturers Webinar Presentation Slides
- U.S. Department of Energy Final Rule
About NEEA & Hot Water Solutions
The Northwest Energy Efficiency Alliance (NEEA) is an alliance of utilities and partners that pools resources and shares risks to transform the market for energy efficiency to the benefit of all consumers in the Northwest.
Hot Water Solutions is a NEEA initiative working to accelerate the adoption of heat pump water heaters in the Northwest by providing resources, tools and support to increase sales and installations of heat pump water heaters.