Predictions For Heat Pump Adoption Trends In 2024

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Welcome to another prognostication for 2024 in clean tech article. This is the third in the series, following our predictions in AgTech, and our predictions in climate policy posts. For this post, I interviewed Joe Wachunas, Senior Project Manager at the New Buildings Institute, who is hands-down one of the most knowledgable experts, as well as one of the biggest fans, of heat pump technology. And once you know, you’ll get it, and join Joe’s bandwagon – heat pump technology is a game changer. Like EVs, which use upwards of 90% of the energy to move the car (vs 25% of the energy for a gas car), a heat pump is simply better tech, and much more efficient.

DALL·E generated image of a wall mounted heat pump air exchange unit blowing cool blue curls of air into a condo living room, digital art

A heat pump water heater, for instance, can do the same job as an electric resistance water heater, with 1/3 the footprint. Boom.

Replace a gas water heater with a heat pump, and you save about 15 tons of carbon emissions over the life of the appliance, as well as saving more than $7000!  It can also be used in an internet of things application, contribute to grid stability, be part of the clean energy storage ecosystem (by heating during off-peak hours, or when there’s an excess of solar or wind…), and improve your family’s health – kids growing up in a house with “natural” gas appliances have a 12.7% greater chance of respiratory disease!

And still enjoy your HOT A*S showers.

So how’s the heat pump market going to go this year?

I’ll get right to that, but first, would you mind chipping in a few bucks a month to help us keep accelerating the clean tech revolution with mindful and accurate journalism?
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Heat pump market 2024

Heat pumps used for heating have started to hit their stride in replacing furnaces. In 2023, 56% of all heating system installations were heat pump, 44% were furnace! According to Brian Stewart of Electrify Now, “This is a complete market share reversal from 2018 and this trend should continue into 2024 and beyond as incentives for heat pumps continue to improve, equipment performance continues to improve and the awareness of the benefits of heat pumps compared to furnaces continues to be more widespread.”

We expect to see aggressive movement in this market in 2024. As I mentioned in my post yesterday about climate policy, the Inflation Reduction Act has only just begun to move markets, and we expect the massive heat pump incentives in the IRA to help facilitate strong market growth in heat pumps this year. With $8,000 rebates for space heating heat pumps, and $1750 for water heating heat pumps, the IRA makes this a no-brainer.

But wait, there’s more! 

One of the really key elements of the IRA is that it does not prevent people from using both federal and other (state/utility) incentives to reduce the cost of a heat pump. So those places where people are lucky enough to live with climate-friendly state governments and cool utilities can stack those dollars on top of federal dollars, depending on a number of other criteria, including income. Consumer Reports does a really nice job detailing all those incentives for  those interested in the details, and of course, you can always consult DSIRE’s database of incentives.

Stewart suggests that the market for heat pump space heating will hit greater than 60% market penetration this year, and “pick up even more momentum in 2025.”

Heat pump water heater market predictions for 2024

Heat pump water heater sales grew 26% in 2022 (and probably more in ’23, though we don’t have full data yet, and of course the home improvement bonanza that was COVID might mess with the historical data trends…).

The shift will also benefit from bigger players shifting housing fleet money. According to Wachunas, “Clayton Homes committed to installing tens of thousands of HPWHs in their manufactured homes this year.” Other homebuilders and managers will start to follow suit, especially as the financial incentives start to stack up, resulting in large scale shifts in market demand.

Wachunas said, given “a big push for the technology in California, the Northwest and the Northeast along with new manufacturers and units coming to market like the 120-volt plug-in heat pump water heater, I expect sales to top 250,000 units in 2024. This would still represent only 3% of the water heating market but would be 10x growth from HPWHs first year in 2009.”

Here’s a few ways you can help: 

  1. Talk about it – many people have no idea what this tech is, or why it’s better. If you have one, have experience with one, or just know about them (or just send them a few CleanTechnica articles about heat pumps), word of mouth can really help good ideas spread.
  2. Talk to contractors about it – many contractors have a thing called “path dependency”. They’ve been installing gas water heaters and electric resistance water heaters for 20 years, why would they change now? So they’ll push those products, talk sh*t about heat pumps so that the homeowner decides not to go with one, and generally be a curmudgeon. Wear a shirt that says, “I hear you, you’re important, but get with the fu*king times.”


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Scott Cooney

Scott Cooney (twitter: scottcooney) is a serial eco-entrepreneur focused on making the world a better place for all its residents. Scott is the founder of CleanTechnica and was just smart enough to hire someone smarter than him to run it. He then started Pono Home, a service that greens homes, which has performed efficiency retrofits on more than 16,000 homes and small businesses, reducing carbon pollution by more than 27 million pounds a year and saving customers more than $6.3 million a year on their utilities. In a previous life, Scott was an adjunct professor of Sustainability in the MBA program at the University of Hawai'i, and author of Build a Green Small Business: Profitable Ways to Become an Ecopreneur (McGraw-Hill) , and Green Living Ideas.

Scott Cooney has 138 posts and counting. See all posts by Scott Cooney