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Hybrid WaterHeater Incorporated, (formed in August of 2005), is developing an energy appliance called the Hybrid WaterHeater, (1st US patent issued in March 2006), which will provide:
1. on-site electrical power generation
2. emergency electrical power
3. unlimited hot water, and
4. space heating and air-conditioning.
Our customers will enjoy substantial savings on the cost of electrical power, hot water, heating, ventilating and air-conditioning (HVAC) while making a positive contribution to protecting the environment by reducing air pollution and reliance on fossil fuels.
Hybrid WaterHeater technology utilizes existing systems integrated with its innovative technology to provide our customers a level of energy supply and security unknown today.
The Hybrid WaterHeater is perfectly suited for new construction and replacement of existing water heaters and furnaces but can also easily be used to retrofit most existing homes, offices and small businesses. It will fit most current on-site electrical load demands, emergency electrical power requirements and hot water supply and HVAC functions.
A Hybrid WaterHeater can be installed in less than four hours in most applications with minimal modifications to existing buildings. The Hybrid WaterHeater monitors energy loads required by each building.
The quality of our standard interconnection to the existing electrical grid will be highly valued by Utility Companies.
Our systems will eliminate the need for monthly meter reading with real time monitoring.
Our products will interface with and enhance the existing renewable energy systems that are currently being developed and installed in California including solar photovoltaic electrical supply systems.
Technology
The Hybrid WaterHeater integrates technologies using several systems including fuel cell, battery and super capacitor, electric power conditioning, on-demand hot water heating, HVAC with automated control, on-site monitoring with internet connections.
Products and Services
The Hybrid WaterHeater can be adapted to match each customer’s specific needs. The service and maintenance agreements will ensure reliable operation of each system.
Marketing
Initial sales to existing buildings will target high-electrical-use homes, offices and businesses in California.
Initial sales to new construction will target the developers of high end homes in California.
Entry Barriers
1. Government requirements and safety certification testing completed
2. Initial product price targets met
3. Lifecycle goals met
These are the three challenges that must be successfully addressed to create profitability and company growth. The company’s focus is to continually advance the performance and lower the costs of our products and services.
Competition
The competition is the multiple conventional industries that are addressed by the hybrid water heater product family.
1. The largest competition of the hybrid water heater is conventional electricity utilities with revenues of over $220 billion dollars a year.
2. The conventional hot water heater manufacturers produce 9 million tank-type water heaters per year.
3. The emergency generator manufacturers sell over 400,000 units per year.
4. The product development team is also developing space heating options for the hybrid water heater. The space heating product manufacturers are also considered competition.
Management will work with all parties to create energy independence for our homes and businesses.
California allows electrical interconnection with the grid and also allows self generation of electrical power. We will work with California utilities to implement the concept of Individualized Distributed Power for high electrical power users.
Simplified projection of the potential electrical power cost saving
Early Adopters will be California electrical users who are billed over $250 per month for electrical usage.
Potential savings based of each kilowatt of electrical capacity installed in each HWH. Savings potentials can be multiplied by specifying increased kilowatt capacity in the HWH.
Electrical costs in California of over 300% of base line rates are billed at over $ .35 per Kw/Hr.
Projected costs of electrical power produced by HWH are $ .10 per Kw/Hr.
Assumed electrical usage over baseline kilowatt hour amounts of 24 kilowatt hours per day
Potential savings of $ .25 per Kw/Hr billed at over 300% of base line rates
24 hour day times $ .25 = $ 6.00 savings per day.
30 days month times $6.00 = $180 savings per month
12 months a year times $180 = $ 2,160 savings per year
Simplified Financial Projections
Hybrid WaterHeaters (HWH) Produced and Sold
The use of conservative and simple numbers to show company profit potential.
Realistic pro forma projections will be made in the coming year of operation by CFO and staff of HWH incorporated.
Units sold Year Water heater Generator *Cost per *Net Profit
Market % Market % unit profit%
5,000 .00055 .0125 $7.5K 15% $2.5 mil
10,000 .0011 .025 $7.5K 15% $5 mil
15,000 .00165 .05 $7.5K 15% $7.5 mil
25,000 .00275 .0625 $7.5K 15% $12.5mil
35,000 .00385 .0875 $7.5K 15% $17.5mil
90,000 Total 5 yrs $ 45 mil
50,000 .005 .125 $7.5K 15% $ 25 mil
70,000 .0077 .175 $7.5K 15% $ 35 mil
90,000 .009 .225 $7.5K 15% $ 45 mil
110,000 .0121 .275 $7.5K 15% $ 55 mil
130,000 .0143 .325 $7.5K 15% $ 65 mil
540,000 Total 10 yrs $270mil
*Note: (Prices & profits projected at the same price & profit for simplicity for this example only)
Funding
The company is preparing two Private Placement Offerings. The first Private Placement Offering in Fiscal-2007 will raise $998,000. The second Private Placement Offering in Fiscal-2008 will raise another $998,000. This funding will allow initial product development and safety certifications needed to enter the California market. The company will be positioned to create an assembly facility to support initial marketing and sales in the 2009-2010 period in California. A third round of funding is anticipated in the range of $10-20 million for the 2008-2010 period.
Exit
The company anticipates a public offering in the 2011-2012 period to develop national and international operations. The company is also a candidate for a major appliance manufacturer or major systems manufacturer that is seeking growth opportunities in the appliance industry and or the distributive generation industry.
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This information may contain forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. In some cases you can identify those so-called "forward looking statements" by words such as "may," "will," "should," "expects," plans," "targets," "believes," "anticipates," "estimates," "predicts," "potential," or "continue" or the negative of those words and other comparable words. These forward looking statements are subject to risks and uncertainties, product tests, commercialization risks, availability of financing and results of financing efforts that could cause actual results to differ materially from historical results or those anticipated. Further information regarding these and other risks is described from time to time in the Company's written communications or our web site and or with any filings with the SEC. We assume no obligation to update or alter our forward-looking statements made in this release or in any other document, whether as a result of new information, future events or otherwise, except as otherwise required by applicable federal securities laws.
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