We chose a heat pump water heater for our new house, and as I've recently discussed here, there are a lot of reasons why you might be doing the same.
Using an air-source heat pump, heat pump water heaters (HPWHs) extract heat out of the air where they are located to heat the water.
That means that a HPWH cools the space where it is located. That’s a good thing in the summer—it doubles as air conditioning—but in the winter it’s not so helpful. That’s especially the case in a cold climate in a house without a standard heating system.