The US heat pump market is growing, but it needs to accelerate to achieve critical climate goals.
Across the United States, over 15 states and roughly 100 cities have begun to shift policies to encourage or require electrification of homes, workplaces, schools, and government buildings.
In fact, as of November 1, 2022, four states have explicitly called for electrification by setting time-bound heat pump deployment targets that together total well over 12 million new heat pumps by 2030:
- In New York, Governor Hochul called for the retrofit of 2 million electrified or electrification-ready homes by 2030, which includes heat pumps, as well as all-electric new construction no later than 2027.
- In California, Governor Newsom called for 3 million climate-friendly homes by 2030 and 7 million by 2035. He set a target of 6 million heat pumps to be deployed by 2030, with at least 50 percent of the funding to achieve these goals to be in historically marginalized and underserved communities.
- The Massachusetts 2020 Decarbonization Roadmap calls for efficient electric heating in approximately 1 million homes and in 300 million square feet of commercial buildings by 2030.
- In Maine, Governor Mills called for the installation of 100,000 high-performance heat pumps in the state’s homes and businesses by 2025, as well as funding commitments to help achieve the goal. Maine is making notable progress toward its commitment — just one year after the commitment, more than 28,000 high-efficiency heat pumps were installed.
However, 12 million new heat pumps by 2030 is a conservative estimate given many of the other state and local government building decarbonization commitments, regulations, and investments. Beyond the above heat pump targets, over 15 states (including California, Colorado, Connecticut, Illinois, Massachusetts, Maryland, Maine, Michigan, Minnesota, New Jersey, Nevada, New York, Oregon, Rhode Island, Wisconsin) and hundreds of cities are taking steps to encourage heat pumps as a critical climate, air quality, and affordability solution through building codes, heat pump incentive programs, low-income electrification pilot programs, pollution limits for gas appliances, and decarbonization requirements for utilities.
As of 2020, nearly 18 million US households used heat pumps for space heating. This represents a 50 percent increase in heat pumps for heating compared with 2015. With the growing momentum and the passage of the Inflation Reduction Act (IRA), this number is expected to climb significantly. Just the residential tax incentives offered in the IRA could lead to over 7 million heat pumps deployed across the country, and since the tax incentives are not capped, this is just a floor. Additionally, the High Efficiency Electric Home Rebate program in the IRA could fund another 2.5 million electrification retrofits for low- and moderate-income households.
These investments and policy changes for heat pumps will lower energy costs for US households as heating bills are expected to rise for most Americans this winter. Gas customers are expected to see a 28 percent increase in their heating bill compared with last year’s winter season, which was already 26 percent higher than the previous. Furthermore, heat pumps demonstrate clear benefits to human health and comfort, heating homes during the winter and cooling them in the summer. Lastly, the recently released IEA World Outlook Report reaffirms previous findings that in order to keep warming to 1.5°C, we must reduce GHG emissions through ending the sale of fossil fuel boilers by 2025, along with a simultaneous growth in heat pump sales and installations.
Bold action and a sustained commitment from local, state, and federal policymakers is needed today to ensure we all have access to healthy, affordable, and climate-friendly places to live and work. Given recent findings that nations are falling woefully short on climate pledges, we must take bigger steps to cut building sector emissions in half by 2030. This is the moment for all decision makers to double down to ensure the transition off gas to super-efficient heat pumps is at the pace and scale required by the climate, and is equitable and just for all.
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