Heat pumps have long been considered an important solution for electrification, but they account for less than 10% of global building heating demand, according to the International Energy Agency (IEA).
The IEA’s zero emissions scenario by 2050 calls for 600 million heat pumps installed worldwide by 2030, compared to 177.3 million in 2020.
Additionally, with energy security a top priority due to rising geopolitical tensions and ongoing supply chain disruptions, the IEA has also highlighted the deployment of heat pumps as part of its 10-point plan to reduce dependence on Russian gas.
Heat pumps work similarly to refrigeration systems such as air conditioners (AC), with the only difference being that they produce heat instead of chilled water and/or air and offer heating and cooling options.
In winter, heat pumps transfer heat from cold outside to warm, and in summer they take heat from the indoor air and push the cold air back. Because they transfer heat from the air, water, or ground rather than burning oil or natural gas (such as boilers or furnaces) to generate heat, heat pumps use significantly less energy and are more energy efficient than traditional heating and air conditioning systems. At least three times higher. Because heat pumps run on electricity, they can make a significant contribution to decarbonizing buildings if the electricity comes from renewable sources.
Although heat pumps have proven their benefits in improving energy efficiency and reducing carbon emissions, they are yet to see the same market growth as solar, wind or batteries due to issues such as cost, lack of skilled installers, and inadequate industrial and political support.
Heating, ventilation, and air conditioning (HVAC) systems typically last 15 to 20 years, so if existing equipment breaks down, households really only consider replacing it every 1 to 20 years. In such emergencies, households will choose the cheapest equipment available, and heat pumps are often not the most affordable or affordable option.
“Some things need to be adjusted so people can get a heat pump in these conditions. Contractors need to be familiar with the technology so they can recommend it. Heat pumps need to be available from local dealers so people don’t have to wait too long. Prices need to be low enough that households can afford the upfront payments. Any subsidy program needs to be simple enough that people can actually get their money’s worth,” said Alexander Guard-Murray, a political economist at the Brown University Climate Solutions Laboratory.
All HVAC systems (not just heat pumps) are expensive to install, and while heat pumps can save on utility bills in the long run, switching to them can involve higher upfront costs, including home upgrades beyond the installation itself.
The average cost of a heat pump varies from country to country, depending on labor costs, local climate, building size, installation complexity, and type of equipment. For example, a heat pump costs about $12,000 in the UK and about $8,500 in Poland, according to Jan Rosenow, European program director for the non-profit energy organization Regulatory Assistance Project (RAP).
U.S. climate research platform Carbon Switch estimates installation costs in the range of $3,500 to $20,000, with an average post-discount cost of around $14,000. Installing a high-end heat pump better suited to colder climates can cost between $18,000 and $25,000, according to Nate Adams, CEO of HVAC 2.0, who builds more economical and energy-efficient homes. A basic HVAC system costs between $9,000 and $12,000.
Once installed, however, homes can save between 12% and 55% on their annual energy bills, according to a study by CLASP, a non-profit organization that advocates for greener, more energy-efficient appliances. Apart from your current heating and insulation system, the exact amount of savings will again depend on the same factors that determine the cost of a heat pump.
Operating costs depend on the climate and the cost of energy, but with rising natural gas prices and increased renewable energy production, “heat pumps are likely to be the cheapest source of heat in all but the coldest climates,” said Adams, who aims to electrify through things. such as “Practical solutions like the Electrify Everything course are available to all homeowners.
Crucially, Carbon Switch has shown that switching to a heat pump can help a home cut carbon emissions by as much as 228 tonnes — more than the roughly 1 tonne per year vegan, and more than installing LED lighting by a factor of 10.
Experts say that having the right financial support mechanisms in place can reduce the initial costs of installing heat pumps, and policy changes that encourage more heat pump production are critical to spurring wider adoption.
Rosenov said reforming energy taxes could be a political tool to reduce the cost of running heat pumps compared to using oil or gas for heating. Several countries have also announced they are phasing out fossil fuel heating systems, including Germany, which has set a goal of installing heating systems using at least 65% renewable energy by 2025. As part of its boiler retrofit programme, the UK is offering grants to install air or ground source heat pumps at a reduced cost.
In the US, the Inflation Reduction Act (IRA) implements a range of incentives, including a 30 percent tax credit of up to $2,000, but it only applies to the Coalition for Energy Efficiency (CEE) top heat pump efficiency rating, Adams explained. The bill also introduces additional discounts for low- and middle-income households, but these will be administered by states that have up to two years to implement the program.
“Despite generous subsidies, there is still a risk of a gap between the money that low-income households receive and the cost of a new high-efficiency heat pump,” Guard-Murray said.
Adams also warned that new refrigerants and higher efficiency requirements are expected next year, which will make heat pumps more expensive and could erode incentives.
Last year, Adams and Gard-Murray went beyond consumers to launch the Hybrid Heat Homes (3H) offering with CLASP, an incentive program for manufacturers and distributors. Incentives ranging from $400 to $500 will be offered to those who fully transition from manufacturing and selling single-sided air conditioners to double-sided heat pumps.
Because the manufacturing and installation process for air conditioners and heat pumps is almost identical, Adams says switching from an air conditioner to a heat pump of the same model can cost as little as an additional $300-600 in bulk costs.
“Essentially an air conditioner and a heat pump are the same thing, think of two identical cars, but one has a reverse gear and the other doesn’t,” Adams said.
With about $10 billion in stimulus, the authors estimate the program will save consumers $27 billion on utility bills over 10 years, as well as an additional $80 billion or more from reduced air pollution and improved social health benefits.
Parts of Proposition 3H have since been included in the Heating Efficiency and Affordability Tax Relief (HEATR) Act, although it also proposes subsidies that are independent of switching from air conditioners to heat pumps. HEATR has been proposed in the Senate but has yet to be passed.
Similarly, the UK is preparing a quota that will require manufacturers to sell an increasing share of heat pumps over time.
Heat pumps can also be used in many industrial processes such as drying, boiling, distillation, preheating or pasteurization in the food, paper or chemical industries, from sugar refining to recycling waste heat into useful energy.
While a solution is still in its early stages, heat pumps can also help solve temporary wind and solar problems by storing energy and turning homes into giant batteries.
“As previous studies have shown, the load profile of heat pumps closely matches wind power generation. Combining on-site solar energy with heat pumps can reduce the operating costs of heat pumps and reduce electricity consumption in the grid,” Rosenov said.
By 2030, heat pumps and energy storage could enable photovoltaic solar and wind to generate 40% of electricity, according to the International Energy Agency.
Most heat pump installations are concentrated in developed countries and China, while other developing countries account for only 4.3% of the total number of heat pumps in the world. Promoting greater adoption of heat pumps in developing countries that continue to rely heavily on fossil fuels for their energy needs is equally important to global decarbonization efforts.
Adams suggested that as demand for air conditioners increases, one way to expand deployment could be to introduce policies to ensure that new air conditioners are two-way heat pumps.
Raising labeling standards to inform consumers about how much heat pumps can save and help developing countries build cleaner energy infrastructure through aid and technology transfer is also key to ensuring electricity is cheap enough to switch to heat pumps, Gard-Mer adds. inside.
As Rosenov says, “Not all buildings are equipped with heat pumps, and other technologies such as district heating and solar heating will also play an important role. However, most analyzes consider heat pumps to be the most important heating technology for achieving climate goals.” ”