Among residential ATW heat pumps, Eco Cute* units using CO2 refrigerant play a central role in Japan. 

Starting in 2012, although ship-ments of Eco Cute units continued to register negative growth compared with the previous year, the negative growth margin continued to decrease. In 2015, however, shipments recorded a 6.7% drop, thus triggering a negative trend again, although the rate of the drop was very low. However, shipment did not decrease to such an extent that they could affect the market, when looked at in terms of a span of several years. Since the occurrence of the great earthquake in 2011, shipments of Eco Cute units as residential water heaters have continued to decrease. From around October 2015, however, they at last began showing signs of an upturn. They continued to register positive growth from February to June 2016, up 0.9%, 1.9%, 13.5%, 11.8%, and 8.4%, respectively. Also, at the end of March 2016, the cumulative total shipments of Eco Cute units topped 5 million units. Since the aim is to distribute 14 million units by 2030 according to the Long-term Energy Demand and Supply Outlook prepared in July 2015, demand for Eco Cute units is expected to continue to expand.

In Japan, liberalization of electricity retailing started in April 2016. Accordingly, products addressing liberalization-related needs began to be released in the market.

Eco Cute units are continuing to draw consumers' attention, mainly because of their high energy-saving performance, their ability to heat water mainly by using nighttime electricity rates which are less expensive and the fact that these units do not affect peak power consumption, and are also able to use hot water stored in the tank in the event of disrupted water supply or a natural disaster. Mitsubishi Electric constructed a composite building within the premises of Gunma Works in order to expand operations to meet future demand for Eco Cute units. The new building was put into operation in July 2016.

The government's subsidy system for Eco Cute units ended in 2010. Even now, however, units are still subsidized by some local government across Japan. As mentioned earlier, however, since the aim is to distribute 14 million units by 2030 according to the Long-term Energy Demand and Supply Outlook, the subsidy system may be restored. Additionally, energy-saving backup measures for residences include a subsidy for Eco Cute units.

In order to back up the expansion of sales of Eco Cute units, the Japan Refrigeration and Air Conditioning Industry Association (JRAIA) is distributing leaflets describing the results of a questionnaire survey of Eco Cute unit purchasers about their degree of satisfaction, outstanding features of Eco Cute units, etc. conducted at exhibitions and large retail stores.