Sign up for daily news updates from CleanTechnica on email. Or follow us on Google News!
New high-performing, energy efficient heat pumps are finally hitting the mass market to be snapped up by home owners, landlords and property managers. Nevertheless, last week President Trump withdrew heat pumps from federal support through the Defense Production Act. The longstanding law dates back to the 1950s. It is intended to stimulate key domestic manufacturing sectors vital to the national interest. So, will the DPA revocation stop the heat pump revolution? Probably not (emphasis on probably).
The Big Heat Pump Dump: Big Deal Or No Biggie?
Electric heat pumps have not always been a widespread form of heating and cooling in the US, partly because earlier iterations of the technology were considered inefficient in colder climates.
Federal energy policy has supported heat pump efficiency improvements for decades, and former President Biden finally took it to the next level with a focus on improving cold climate efficiency. In 2021, the US Department of Energy launched the new “Residential Cold Climate Heat Pump Technology Challenge,” a public-private partnership supported by the leading manufacturers Lennox International, Carrier, Trane Technologies, and Rheem. Bosch, Daikin, Midea, and Johnson Controls also joined later.
By 2022 things were already heating up, with the Energy Department’s National Renewable Energy laboratory focusing attention on a new generation of ductless heat pumps. “As the name indicates, ductless heat pumps can be installed in a building without the added expense of new ductwork. That can make a significant difference in the cost of new construction as well as retrofits for existing buildings that use steam heat, electric baseboard or other non-duct systems,” CleanTechnica noted.
Here Comes The DPA
In 2022 Biden also invoked the DPA in 2022 to authorize federal funding for next-generation technology improvements leading to mass market circulation. Accordingly, in 2023 the Energy Department was empowered to disburse $169 million in federal funds supporting new heat pump technology, followed by another $85 million last fall aimed at accelerating production (see lots more background here)
“Heat pumps are critical to reducing the nation’s reliance on fossil fuels, bolstering national security, and boosting energy independence to strengthen national defense, lowering consumer energy costs, improving energy efficiency, and mitigating the climate crisis,” the Energy Department continues to explain on its DPA web page.
Why would anybody want to gum up federal support? That’s a good question. With an assist from dollars already disbursed under the DPA and other federal programs, heat pump manufacturers are already producing next-generation heat pumps that cruise past the cold-climate limit while beating fossil energy on operating costs, opening up new markets in the US.
To that extent, the mission has been accomplished. Some industry insiders agree that the DPA revocation will have a limited impact, if any. “While the immediate consequences of this latest action are still unclear, one industry veteran was skeptical that it would have a major impact on the role heat pumps are currently playing in the HVAC sphere,” ACHR News noted, citing healthy consumer demand for new, energy efficient technologies that help push fossil energy out of home heating and cooling systems.
More Heat Pumps Are Coming For Your Fossil Fuels
Another new demand-supporting factor is the heat pump tax credit introduced by the Inflation Reduction Act of 2022. Trump has threatened to eliminate the tax credits along with the rest of the IRA, but some state-level policy makers have already prepared to take action on their own. In February of 2024, nine cold climate states including California, Colorado, Maine, Maryland, Massachusetts, New Jersey, New York, Oregon, and Rhode Island announced a new collaborative effort to accelerate heat pump adoption.
Left unsaid at the time was actually how the collaborative effort would get the job done, though California had a bit of a head start, having already launched an initiative in 2022 to get 6 million heat pumps into residential buildings by 2030.
Six million is a big number. When CleanTechnica caught up with the program last May, obstacles continued to block the way, one particularly thorny issue being how to motivate landlords to upgrade HVAC equipment without placing new financial burdens on tenants. California released a more detailed roadmap last week, though funding has yet to be established.
More Heat Pumps For The USA?
Still, all of this activity is focused mainly on the HVAC space. There is more R&D work to be done. Aside from HVAC equipment, the Energy Department has also been supporting applications to hot water heaters, clothes dryers, and industrial operations. Given the current state of federal energy policy, it is unclear whether or not federal resources will be available to help manufacturers take these next steps.
The Trump administration also has other opportunities to slow, if not stop, the heat pump movement. Last year, for example, the Mitsubishi Electric branch of Mitsubishi began finalizing plans for a $143 million makeover of its existing factory in Kentucky, with the newly refurbished plant scheduled to start producing in 2027.
“When complete, the revamped factory will represent the first time that variable-speed compressors using twin rotary technology for highly efficient ductless heat pumps will be manufactured in the United States,” Mitsubishi explained in a press statement in December.
“More than 90% of these compressors for in-demand ductless heat pump systems are currently built in China and other countries in Asia,” the company added.
The factory makeover earned support from the US Department of Energy in 2023, in the form of a three-year, $50 million funding package to help Mitsubishi offset the cost of the upgrade. The conditions of the award were still under negotiation as of last July. No word yet on whether or not the Trump administration will try to claw it back.
Another Industrial Revolution, Or Not
If leading heat pump manufacturers can’t manufacture their new technology here in the US, they can certainly take it overseas to other countries where there is more support from national energy policy, manufacturing policy, or both.
Take the industrial heat pump market, for example. Last month the market research firm Technavio ran the numbers and came up with the headline, “Industrial Heat Pumps Market to Grow by USD 754.8 Million (2025-2029), Driven by Energy Efficiency Focus.”
“Rising focus on improving energy efficiency by industries is driving market growth,” Technavio summarized.
While taking note of significant obstacles to widespread adoption, Technavio also name-checked a long list of leading global manufacturers in industrial heat pump sector including several that have been supported by US taxpayers: Bard HVAC, Bosch Industriekessel GmbH, Carrier Global Corp., Daikin Industries Ltd., Danfoss AS, Emerson Electric Co., Johnson Controls International Plc, Lennox International Inc., LG Corp., MAYEKAWA MFG. CO. LTD., Meier Tobler AG, Mitsubishi Electric Corp., NIBE Industrier AB, OCHSNER Warmepumpen GmbH, Oilon Group Oy, Rheem Manufacturing Co., Robur Spa, Sirac Air Conditioning Equipments Co. Ltd., and Systemair AB.
What a waste of taxpayer dollars and federal dollars it would be if any or all of these manufacturers decide that US energy policy is too unreliable to support any further efforts to stamp “Made in the USA” on their products.
If you have any thoughts about that, drop a note in the comment thread. Better yet, find your representatives in Congress and tell them what you think.
Image: President Trump revoked support for heat pumps under the Defense Production Act last week, but new cold climate heat pumps are already happening (courtesy of US Department of Energy).
Whether you have solar power or not, please complete our latest solar power survey.
Chip in a few dollars a month to help support independent cleantech coverage that helps to accelerate the cleantech revolution!
Have a tip for CleanTechnica? Want to advertise? Want to suggest a guest for our CleanTech Talk podcast? Contact us here.
Sign up for our daily newsletter for 15 new cleantech stories a day. Or sign up for our weekly one if daily is too frequent.
CleanTechnica uses affiliate links. See our policy here.
CleanTechnica’s Comment Policy