Cost Barrier Hinders Widespread Adoption of Heat Pumps in US Homes: NREL
Published in the journal Joule, the study analyzed the costs and benefits of air-source heat pumps across various climates, heating sources, and home types, based on simulations of 550,000 statistically representative households.
February 13, 2024. By Abha Rustagi
Published in the journal Joule, the study analyzed the costs and benefits of air-source heat pumps across various climates, heating sources, and home types, based on simulations of 550,000 statistically representative households.
The analysis revealed that a majority of Americans (62 percent to 95 percent of households) could potentially see a drop in their energy bills by using a heat pump. However, the addition of measures such as upgrading home insulation could increase this range from 82 percent to 97 percent. Despite these potential savings, the high installation costs may render heat pumps financially feasible for only a smaller portion of households.
Eric Wilson, a senior research engineer at NREL and lead author of the paper, highlighted the availability of incentives such as tax credits and rebates through the Inflation Reduction Act, which could benefit millions of households. However, he emphasized the need to work on reducing the cost of installing heat pumps to make them accessible to more households.
The study also noted that homeowners without existing air conditioning would benefit from additional comfort provided by heat pumps, albeit at an additional cost. Additionally, the lack of experience among installers with heat pumps could lead to higher prices.
On a national scale, the researchers estimated that heat pumps could reduce home energy use by 31 percent to 47 percent, depending on their efficiency level, and by 41 percent to 52 percent when combined with building upgrades such as improved insulation. However, the disparity between energy savings and cost savings is influenced by lower natural gas prices compared to electricity prices in many regions.
The study found that housing characteristics such as heating fuel type and the presence of air conditioning significantly influenced savings. For homes using electricity, fuel oil, or propane for heat and equipped with air conditioning, 92 percent to 100 percent could experience energy bill savings, with median savings ranging from USD 300 to USD 650 annually depending on heat pump efficiency.
Prateek Munankarmi, a co-author of the study, highlighted that savings were most notable in colder climates, and homeowners could potentially save thousands of dollars by installing smaller heat pumps after improving energy efficiency.
Moreover, the researchers found that heat pump installations led to a decline in greenhouse gas emissions in every state, especially when replacing heating systems powered by fossil fuels. Nationally, heat pumps could reduce residential sector greenhouse gas emissions by 36 percent to 64 percent, including emissions from new electricity generation.
The research was funded by the Department of Energy’s Building Technologies Office, underscoring the importance of addressing barriers to the widespread adoption of heat pumps in US households.
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