Member Spotlight
A.O. Smith’s Split Heat Pump Water Heater Is Closing a Gap in the California Market
Each year, heat pumps are getting more efficient, more affordable, and more adaptable to the wide range of homes and climates found across the world. That momentum shows up in the product innovation that members of the California Heat Pump Partnership (CAHPP) are bringing to market and to the state’s clean energy transition.
This month, we’re spotlighting how CAHPP member A.O. Smith’s brand new heat pump product, the Voltex® X Outdoor Split Heat Pump Water Heater (HPWH) developed in partnership with Panasonic, is helping to fill existing gaps in California’s heat pump water heater market. A. O. Smith is a global water technology manufacturer with more than 150 years in the industry. The company has a broad residential and commercial HPWH lineup, which it continues to expand as it prepares for the Department of Energy’s NAECA IV updated residential efficiency standards to take effect in 2029.
A solution for homes where standard heat pump water heaters fall short
Most residential heat pump water heaters are typically indoor, all-in-one (standard or integrated) units that pull ambient heat from the surrounding air. That works well in many traditional homes, but according to A.O. Smith’s team, between 20% and 30% of the U.S. water heater market requires installations that a standard heat pump water heater can’t accommodate. Such situations might include:
- Water heaters in outdoor or unventilated closets—common throughout California multifamily and manufactured housing—in areas where low ambient temperatures reduce a standard heat pump’s efficiency or shut off heat pump mode entirely
- Space-constrained installations, such as small closets or utility rooms that can’t accommodate the footprint or airflow clearance a standard unit needs
- Cold-climate regions, including California’s mountain and high-desert communities, where winter temperatures regularly drop well below the point where conventional heat pump water heaters might stop operating efficiently
A handful of products have served residential split-system space for years, but A.O. Smith’s is the first split heat pump water heater from a major manufacturer in North America to reach the broader market.
A.O. Smith’s new split design in Voltex X targets these issues
Announced this spring and available in all major California markets, the Voltex X’s “split system” separates the heat pump component from the storage tank so that the heat pump unit is installed outdoors while the storage tank, which is available in five configurations, can be placed indoors in a smaller footprint than a traditional integrated system requires.
A. O. Smith’s senior product manager, Brad Vossler, explained that the product addresses a long-standing barrier that is specifically designed to extend heat pump water heater installations to homes where “environmental conditions, such as temperature and space constraints” have historically ruled them out.
A few benefits that make the Voltex X stand out:
Quieter, more flexible installs: Moving the compressor outdoors reduces the operational noise inside the home while the small indoor footprint allows for installations in units that previously couldn’t fit a heat pump water heater at all.
Cold-climate performance: The outdoor unit is rated to operate down to -25°F, using a CO2 refrigerant loop that circulates heat to the water lines and helps prevent freezing, with an available anti-freeze mechanical leak valve for added protection during power outages. This low temperature rating offers a big advantage over many standard heat pump water heaters and makes installations more accessible in cold-climate regions.
No refrigerant lines to the tank: Because the refrigerant loop stays self-contained in the outdoor unit without any lines, trained plumbers can install the system without needing training in refrigerant handling or equipment. HVAC contractors already have experience mounting outdoor heat pump units on walls, roofs, or pads, so the split design draws on skill sets both trades already have.
No condensate line plumbing needed: With most integrated heat pumps, non-toxic condensate drains require separate plumbing connections or condensate pumps to manage water flow. Moving this to the exterior eliminates additional plumbing steps.
Innovation that’s part of a larger statewide shift
The Voltex X is one product amidst a broader wave of heat pump water heater innovation reaching California this year, and emerging market data backs that up.
In the U.S., heat pump sales have doubled over the past 15 years, from 1.8 million annual shipments in 2010 to 3.64 million in 2025, according to the Building Decarbonization Coalition’s Momentum Q2 2026 report. Heat pumps and other types of electric heating equipment also reached their highest market share of 61% in new housing units in 2024, while gas heating recorded its lowest market share of 38% in new homes since 1985. And electric water heaters specifically continued to make up the majority of both residential and commercial water heater shipments, with their second-best sales month ever in December 2025 per RMI’s market tracking. This is consistent with TECH Clean California’s findings that 9 in 10 heat pump owners are satisfied with their heat pump water heaters.
It’s clear that heat pump water heaters continue to gain market share in California and nationally. Customers who install them are satisfied, and manufacturers are quickly working to fill remaining gaps with cold climates, small spaces, and multifamily buildings.
CAHPP members play a critical role in driving the state’s clean energy transition
The California Heat Pump Partnership is the first statewide public-private partnership to scale heat pump adoption by bringing together state agencies, large manufacturers, utilities, and major market actors in California’s clean energy economy. Our manufacturer members are working to bring heat pumps to homes that have been harder to reach in support of the state’s goal of installing six million electric heat pumps by 2030. With their partnership and innovation, they are sending a global market signal and helping ensure that heat pumps are more affordable, available, and accessible for Californians and beyond.
