Heat Pump Market in the US by Type, Market and Region

Report Overview

Continued Strength in Construction Spending to Support Sales, but Expiration of Federal Tax Credits will Prevent Faster Gains

US demand for heat pumps will see a reversal from recent market declines, but the expiration of federal tax credits at the end of 2016 will result in sales continuing to stay below the highs recorded before the Great Recession. Nevertheless, ongoing strength in US building construction expenditures will support sales increases. Additionally, heat pumps are a more energy efficient option for comfort cooling compared to other types of HVAC equipment, helping boost market gains.

Key Findings in the Heat Pump Study:

Air Source Heat Pumps to Remain the Dominant Product Type

Air source heat pumps are a viable HVAC equipment option in most building settings, and have a much lower installation cost than geothermal units. Moreover, many air source heat pumps utilize the same distribution method as unitary air conditioners, and thus can replace these units as a more energy efficient type of cooling equipment that can also provide supplemental heating.

Residential Installations to Post Faster Demand Gains

Demand for heat pumps used in residential buildings is expected to climb at a faster rate through 2021 than commercial building product sales, reversing a long term trend. Strong anticipated increases in new housing completions and residential building construction expenditures will provide the main impetus to growth.

Heat Pump Demand to Remain Concentrated in the South

The climate in most Southern states, with warm summers and mild winters, is optimal for heat pump use. As a result, the region comprises more than two-thirds of total heat pump demand and will account for the majority of all additional heat pump sales through 2021. However, demand in the West will increase at a faster rate through 2021. Product improvements have enabled heat pumps to better perform in areas with colder winters and, as a result, growth in heat pump demand in the West has outpaced sales in other US regions in recent years. This trend is expected to continue through 2021.

Study Coverage

This study presents historical demand data (2006, 2011, and 2016) and forecasts (2021) by product (air source, including air-to-air and air-to water; and geothermal, including closed loop and open loop), market (residential and commercial), and US region (Northeast, Midwest, South, and West). The study also evaluates company market share and competitive analysis on industry competitors including AAON, Daikin Industries, Electrolux, GD Midea, Ingersoll-Rand, Johnson Controls, Lennox, Melrose Industries, NIBE Industrier, Paloma, and United Technologies.