Growing Momentum Toward Building Decarbonization in the US

The past 12 months have seen a flurry of activity in the US around building decarbonization. New regulations are putting buildings at the center of climate policy and are expected to significantly grow the US market for decarbonization-related services and technologies.

Cities and states are championing climate goals and adopting groundbreaking regulatory frameworks. In 2018, California passed a low carbon buildings bill mandating a 40% reduction of building emissions below 1990 levels by 2030. The legislation was followed by another bill intended to spur the market through a $200 million investment into two programs: Building Initiative for Low Emissions Development (BUILD), and Technology and Equipment for Clean Heating (TECH).

New York City has also been making headlines for progress on building decarbonization. The Climate Mobilization Act passed in April 2019 and mandates buildings above 25,000 square feet to cut emissions by 40% by 2030 and 80% by 2050. Among other policies, Washington, DC has pledged carbon neutrality by 2050. The states of Washington and Massachusetts and the cities Minneapolis, Minnesota and Boulder, Colorado have also adopted a slew of measures toward energy efficiency and decarbonization in the built environment.

Opportunities for HVAC Manufacturers

Heat pumps and variable refrigerant flow (VRF) systems will play a key role in meeting the requirements of these new regulations. While other efficient electric HVAC system exist in the market, policymakers, nonprofits, and think tanks have been stressing the need for broad market adoption of these technologies in both residential and commercial sectors to meet decarbonization targets.

The appeal of both technologies comes from their ability to provide both heating and cooling at a much higher efficiency than conventional electric appliances. Additionally, heat pumps have been evolving rapidly to ensure occupant comfort in a variety of climates. Evolution in the types of refrigerants these systems use also contributes to their appeal. More and more manufacturers are starting to use carbon dioxide, ammonia, and hydrocarbons in place of traditional hydrochlorofluorocarbons and hydrofluorocarbon refrigerants, which are associated with significant greenhouse gas emissions.

Education Is Key

Stakeholder commitment to these technologies creates an opportunity for heat pump and VRF manufacturers to firmly establish themselves in the US market. End-customer education will be a key investment for manufacturers to make at this time. Educational efforts should include building owners and facilities managers, as well as general contractors and HVAC installation and commissioning firms. Now that policy is catching up with available technology to make decarbonized buildings a reality, integrating advanced HVAC into the construction and retrofit value chain will be the biggest hurdle to overcome.