Despite immense climate benefits and cost savings, heat pumps are still not in widespread use in the United States. That could change with President’s Biden’s recent announcement to invoke the Defense Production Act (DPA) to expand domestic manufacturing of several clean energy technologies, including heat pumps. A previous blog post explains how a heat pump works and lays out benefits and challenges to widespread adoption. Here we summarize the current policy landscape related to heat pumps in the U.S.
Despite barriers, things are moving in the right direction, albeit much more slowly than studies indicate is necessary to meet our climate goals. If past trends continue, the units installed globally by 2030 would fall 58% short of what is called for in the International Energy Agency’s Net Zero Scenario. However, the past few months have seen an explosion of heat pump related resources—including guides from Wirecutter, CNET, and How Stuff Works—and policies at the federal and state level, as explained below.
The U.S. Department of Energy (DOE) will be investing heavily in heat pump technology. In December 2021, DOE chose the first industry partners for a Cold Climate Heat Pump Technology Challenge, the goal of which is to increase heat pump performance at cold temperatures, improve heating capacity and efficiency, and develop advanced controls to adjust usage based on demand.
In June 2022, DOE announced that the American manufacturer Lennox International achieved the objectives of the challenge by producing a more effective heat pump for colder climates.
Also on the federal level, two bills introduced in May 2022 could help get more heat pumps in homes. The Installing Clean Efficient Energy Hastens Our Transition (ICEE HOT) Act would incentivize air source heat pumps and other home appliances through a rebate system. The Heating Efficiency and Affordability through Tax Relief (HEATR) Act would provide tax incentives for manufacturers to produce two-way heating and cooling heat pumps instead of traditional central air conditioning units. The programs proposed by these bills could accelerate the necessary market transformation by increasing the supply of heat pumps and simultaneously lowering their costs.
Finally, President Biden’s invocation of the DPA in June 2022 to boost manufacturing of key clean energy technologies, including heat pumps, could provide a useful market signal. While this executive action is an encouraging step, it is likely not a long-term solution without additional Congressional action. There are also remaining questions about the supply chain, grid capacity, and the need to simultaneously expand renewables, storage, and smart technology alongside heat pumps.
Some U.S. states are incentivizing heat pump adoption. In 2018, California’s Governor Jerry Brown signed into law Senate Bill 1477, which provided $50 million in annual incentives for low-carbon heating alternatives such as heat pumps, and Connecticut, Maine, Massachusetts, and New York all offer heat pump incentives.
Northwest policymakers have passed heat pump programs as well. In the 2022 session, Oregon legislators passed SB 1536, directing the Oregon Department of Energy to develop a $10 million heat pump deployment program and a $15 million grant/rebate program for heat pump installation.
The Washington State House introduced HB 1767 during the 2022 session, which would have allowed utilities to offer incentives and other programs to help customers switch to electric appliances such as heat pumps. The bill died before making it to a floor vote.
However, the Washington State Building Code Council subsequently passed a mandate requiring newly constructed multi-family and commercial buildings to have electric heating and hot water systems starting in July 2023, making Washington the first U.S. state to mandate energy-efficient electric heat pumps for these types of buildings.
While it takes time to build and shift markets, policy can be a key driver of the transformational change that is needed. With continued efforts, heat pumps could become the go-to heating appliance and provide benefits to both homeowners and the climate.
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