The objective of this paper is to investigate the performance characteristics of a $CO_2$ cooling and water heating system using a twin-rotary compressor with the compression volume ratio of 0.6. The cooling performances of the $CO_2$ heat pump were measured and analyzed with the variations of charge amount, EEV opening, and compressor frequency. In addition, the performance of the combined system including cooling and water heating was also measured and analyzed by varying inlet temperature of the EEV. As a result, the optimal normalized charge and cooling COP in the cooling mode were 0.307 and 2.06, respectively. The application of the water heating into the $CO_2$ heat pump improved the cooling performance over 78% and decreased the EEV inlet temperature by $8^{circ}C$, which can increase system reliability.