The opportunity: If the over 50 million US homes that have central air conditioning and a separate heating system just replaced their AC with a look-alike and more efficient “two-way” heat pump unit, those households could not only cool over the summer, but they could also heat during the spring and fall. This would produce the immediate benefit of cutting a home’s fossil-fuel bill and its carbon emissions.
On a practical level, how easy is it to replace a failed central AC unit with a heat pump?
In a webinar last month, Make the Swap: Why It’s Time for Heat Pumps, Not ACs, CLASP,RAP, and their guests answered this and other questions.
SPOILER ALERT: It’s pretty easy.
“Make the Swap” assembled a panel of speakers to provide manufacturer, installer, and policy perspectives. Camille Kadoch from RAP moderated a discussion with Matt Malinowski of CLASP; Weston Berg of the American Council for an Energy-Efficient Economy (ACEEE); Nick Harbeck of Johnson Controls; and Nate Adams of HVAC 2.0.
What follows are excerpts from their discussion.
Matt Malinowski, who spent over a decade supporting the federal Energy Star efficiency programs and is now CLASP’s director of climate research, framed the discussion with a short presentation that builds on CLASP and RAP’s recent study, Combating High Fuel Prices with Hybrid Heating: The Case for Swapping Air Conditioners for Heat Pumps. In a nutshell: Today, the homes that cool during the summer with central AC, heat during the cooler months with a separate furnace or boiler. When that AC unit dies, if it’s replaced with a heat pump, then that efficient appliance could not only cool the home more efficiently in the summer months, but it could also heat the home in the fall and spring, displacing less-efficient fossil or electric resistance heating.
“It’s a little sneaky,” admitted Malinowski when questioned by Kadoch. “Getting at heating load through cooling allows people to keep their current heating systems and does not require a full change out.”
Why Is This Hybrid Approach Possible?
According to Malinowski, Americans buy 4 million heat pumps and 4 million gas furnaces each year. But they also buy 6 million central AC units each year. If, over ten years, those AC units were replaced with heat pumps, then more than half the US housing stock would have installed heat pumps, independent of any other efforts to swap out furnaces and boilers.
Kadoch noted, “So, this approach is about ‘displacing’ and not ‘replacing.’ ”
“Yes, our modeling for the lower 48 states and Washington DC, found that under very conservative assumptions — the ‘changeover,’ where the heat pump hands back home heating to the furnace at 40 degrees Fahrenheit — we could eliminate 39% of fossil fuel heating.” Furthermore, he explained, “under those assumptions, household utility bills and CO2 emissions would drop by 11%, and emissions reductions would grow to about 50 million tons of CO2 annually by 2032.”
As Matt’s summary made clear, there are many advantages to this approach. They include reduced consumer costs, increased choice, a cold climate backup with the existing furnace (but avoided fossil-fuel emissions when that furnace doesn’t need to be used) and ease of installation: heat pumps can be “dropped in” to replace central AC.
How Can Heat Pumps Just Be ‘Dropped In’?
Kadoch then turned the conversation to Nate Adams, the “House Whisperer” who has been electrifying homes since 2014 and is CEO of HVAC 2.0, a nascent network for HVAC contractors that lean towards electrification.
Kadoch: “Nate, so, what does it look like when you replace a failed central AC unit with a heat pump? Are we ready for this?”
Adams: “The answer is there’s not a big difference. The way that I compare a heat pump and an air conditioner, it’s like two identical cars, but one [the heat pump] has a reverse gear and the other doesn’t.”
“Are we ready, largely, yes. It doesn’t take much more time to install — 20 or 30 minutes. Fundamentally, it’s the same piece of equipment; all the connections are the same.”
Kadoch: “Is it going to be challenge finding someone to do this installation?”
Adams: “One of the reasons this hybrid approach came up in the first place — it lets everyone keep their existing heating system — their safety blanket. You can do this in any home with central AC with little pushback from contractors.”
“But the critical thing that needs to happen — because the vast majority of installs are done on an emergency basis when the AC fails on a hot day — is that a heat pump needs to be available in the contractor’s supply house. Otherwise another air conditioner will get installed. A contractor puts in what’s on the shelf.”
“The wholesale cost difference, what the contractor pays off the shelf at the supply house, runs generally between $300 and $600 difference for the same type of unit.”
Getting Heat Pumps on the Shelf
Kadoch then questioned Nick Harbeck, manager of regulatory and environmental affairs at Johnson Controls, a company manufacturing residential and commercial heat pumps in Wichita, Kansas and Norman, Oklahoma.
Kadoch: “Nate, given that there are more ACs sold today than heat pumps, are manufacturers now targeting the AC market with heat pumps?”
Harbeck: “Yes. We view this as an enormous opportunity both from a market perspective and with respect to CO2 reductions.”
“It is also important to recognize that there are programs out there to incentivize the installation of heat pumps. So, in addition to the low cost of switching from an AC to a heat pump, there is the Inflation Reduction Act, for example. Section 25C provides homeowners with a tax credit for investments in certain high-efficiency appliances, and the HOMES program is a rebate program for housing energy retrofits. Both provide strong encouragement to install heat pumps. Those incentives are very rich and can be expected to move the needle toward the more advantageous equipment to install.”
The Policy Environment
Kadoch also explored the policy landscape for heat pumps with Weston Berg, a senior researcher with ACEEE who provides research and technical assistance related to utility regulations, and is one of the authors of ACEEE’s State Energy Efficiency Scorecard since 2016.
“We are seeing the greatest amount of activity from states that have recently passed clean energy legislation and want to secure carbon reductions from the power sector,” Berg said. “California and Massachusetts get mentioned a lot, but just in the past year we’ve seen activity in the Midwest — Minnesota’s Eco Act, Illinois’ Climate Equitable Jobs Act, and energy legislation and other policies coming out of Colorado.”
“Perhaps the biggest barrier that we see is that utility energy efficiency programs are not inclined to support fuel switching from fossil fuel heating to electric. In some places it is actually prohibited.”
“That said, we are seeing states do the work and try to reform those types of policies,” Berg added, highlighting states such as Maine and New York that are setting particular targets for heat pump adoption, as well as others that are retooling their efficiency targets to emphasize total fuel savings or avoided emissions.
“The second point is that states are changing energy efficiency rules to make clear that programs can fund electrification as a form of energy efficiency, when it saves total energy and avoids GHGs,” Berg said. “Giving a green light for funding, of course, provides some certainty and enables utilities to go after those savings in a deliberate way.”
Berg went on to explain that cost-effectiveness tests are a key determinant as to whether utilities can go after these savings. Not valuing the full range of benefits skews the analysis and will impede heat pump adoption. Colorado, for example, now requires the analysis of heat pumps to incorporate the social cost of carbon. Some states are adopting performance incentive mechanisms to reward utilities for heat pump adoption. There are also cases where utilities are rewarded for building retrofit measures or where jurisdictions adopt building codes that incorporate electric-ready requirements.
This hybrid approach is available today for more than 50 million US homes. Doing it sounds pretty easy, too. Perhaps most important, this is urgent, as the authors of Combating High Fuel Prices with Hybrid Heating emphasized:
Every six seconds a new residential furnace or air conditioner starts up in the United States, and that decarbonization opportunity is lost until 2035-2040.