To install a heat pump hot water system, you’ll almost certainly need a dedicated 240 Volt outlet. Most homes with a current electrical water heater already have it plugged into such an outlet. If you have a gas water heater, you might need an electrical panel upgrade. That said, newer heat pumps are being developed that can operate on standard 120 V outlets. If you need to upgrade your electrical panel to accommodate a heat pump water heater, the federal government offers up to a $4,000 rebate to help. For electrical wiring improvements, you can access up to a $2,500 rebate.