General HVAC
Share To:

Why The HVAC Industry Is Heating Up

The HVAC industry has always played a critical role in maintaining and improving the American standard of living. Today, heating and cooling technology has a new challenge. As a warming planet increases the need for air conditioning, HVAC innovation must create more energy-efficient systems to reduce emissions from households and commercial buildings.

We look at key HVAC industry trends and statistics that offer insight into the challenges and tailwinds expected in the years ahead.

HVAC Industry Growth Forecast

Climate change has lengthened cooling seasons and increased severe weather events, like heat waves. Population growth in equatorial countries, including India and several sub-Saharan African countries has also contributed to increased demand overseas. Providing affordable and efficient cooling technology in Africa is a life-saving priority for regional governments, especially with the population expected to double by 2050.

With a market valuation of $16.54 billion in 2021, the HVAC industry is expected to grow at a 5.6% compound annual growth rate (CAGR) through 2030.

Growth and improved efficiency are the defining challenges of HVAC. As an industry, we face two almost contradictory needs; to provide lifesaving cooling as global temperatures rise and to do it while substantially lowering carbon emissions.

What's Driving Growth? 

Since 1981, the combined average land and ocean temperature has increased 0.32 degrees Fahrenheit; more than double the temperature increase during the previous century. The warming climate also increased the number of American homes looking for air conditioning.

Air conditioner sales peaked in December of 2021, with more than 6.28 million air conditioning units sold. That's only part of the story, however. Heat pumps, which are capable of heating and cooling homes, contributed another 3.8 million units sold in the same period. Combined AC and heat pump sales increased by nearly 10% compared to 2020.

Residential air conditioning demand is expected to increase by 8% as the global average temperature exceeds 1.5 degrees Celsius above pre-industrial levels. That benchmark is roughly a decade away, and the world is well behind in avoiding such an increase.

Carrying the Momentum 

Passed in 2022, the Inflation Reduction Act provides up to $8,000 in tax credits and more than $14,000 in rebates to help homeowners purchase energy-efficient HVAC equipment. The incentives vary by region and level of income, but most homeowners qualify for some form of assistance. Federal and state subsidies are expected to increase demand for energy-efficient air conditioning systems, heat pumps, and other improvements designed to lower emissions-and energy bills.

Challenges Facing the HVAC Industry 

Tasked with an essential role in fighting climate change and providing heating and cooling for more and more customers, the HVAC industry has a big lift in the next decade. To succeed, it will rely on innovative minds and dedicated experts to continue to design and implement ever-more energy-efficient technology.

It will also require electric utilities across the country to continue or even accelerate their transition to renewable energy, retiring coal plants ahead of schedule and making up the lost generation with wind and solar instead of natural gas.

It will also require HVAC experts on the ground to build awareness about electrification, Energy Star-rated HVAC appliances, and the generous federal and local incentives available for the most carbon-saving HVAC options.

HVAC Labor Shortages Stifle Business 

Between 2020 and 2030, the HVAC industry will need to recruit 19,000 more qualified technicians. In a competitive labor market, meeting a 5% growth rate will be a challenge for residential and commercial HVAC operators.

Different jobs in the HVAC industry require varying degrees of training and certification, which could push businesses to provide financial support for job candidates to meet local and federal training requirements.

There are tens of thousands of open positions in the US, topped by Florida:

  • Florida – 33,210 open positions
  • California — 32,410
  • Texas — 28,010
  • New York — 16,730
  • Pennsylvania — 14,900

Related: Complete Guide to Energy Efficiency

Residential HVAC Is Getting Smarter 

Artificial intelligence in HVAC will play a role in providing seamless integration with the Internet of Things. Smart thermostats are the first step toward integrating household energy consumption and making real-time adjustments to demand.

This is more than adjusting your thermostat from your phone. In the years ahead, HVAC systems will communicate with other household appliances, react to electricity rates in your area, and even prioritize the use renewable energy.

HVAC Is Only Getting Cooler 

The combination of technological innovation and increased demand drives sustained growth in HVAC. Residential heating and cooling haven't played this large role since air conditioning was popularized in the 1940s.

Be a part of the change. Speak with your local One Hour Heating & Air Conditioning service professional for ways to reduce HVAC energy consumption at home. Book an appointment or call (800) 893-3523.

Related Posts