U.S. Heat Pump Sales Surpass Gas Furnaces

Efficient and Emission-Free, Heat Pumps Are Gaining Popularity in New York and Beyond

For the first time, heat pumps – electrically powered and highly efficient devices that deliver heating and cooling – topped gas-powered furnaces in total units sold in the U.S. Americans bought more than 4.3 million heat pump units in 2022, compared to roughly 3.9 million natural gas furnaces^[1].

Modern cold-climate heat pumps are a smarter, more efficient, and environmentally friendly option to keep homes comfortable without using fossil fuels. Heat pumps work by extracting heat from the air, ground, or water and transferring it inside a building for heating and outside for cooling.

Since heat pumps transfer heat rather than generate it, they’re more efficient than conventional heating systems like boilers, furnaces, and electric heaters. Compared to oil-fuel systems, ground source heat pumps are three times more efficient, while air source heat pumps can reach up to 50% greater efficiency.

The Southeast, where residential natural gas connections are less common, currently has the greatest concentration of heat pumps in the U.S. However, adoption of these efficient clean heating and cooling systems is growing in colder climates like New York, especially now that cold-climate heat pumps are standard options for homes and businesses. More than 29,500 heat pump projects were installed in 2022 across New York State, representing 37% growth from 2021^[2].

Heat Pumps Are Key to Combating Climate Change

The heat pump has a pivotal role in curtailing greenhouse gas emission from New York’s buildings. The onsite combustion of fossil fuels for space and water heating in New York’s homes and businesses accounts for 53% of emissions in the buildings sector^[3]. Every building that switches from fossil fuel heating equipment to heat pumps for heating and hot water will immediately reduce emissions and air pollution – both inside and outside.

To meet the Climate Act’s emission reduction goals, between 1-2 million homes in New York, including apartments, need to adopt heat pumps by 2030. And by 2050, the majority of New York’s buildings, including commercial and institutional facilities, will use heat pumps for their heating and cooling.

As more New Yorkers adopt heat pumps, the electricity powering them will be from an increasingly renewable power supply. New York’s electricity system is on track to run on 70% renewable sources by 2030. The Climate Act sets a subsequent goal of achieving a zero-emission electricity system by 2040.

How New Yorkers Can Make the Switch to Heat Pumps

Many New Yorkers are already heating and cooling their homes and businesses with modern, cold-climate heat pumps, which deliver year-round comfort and efficiency – even in subzero temperatures.

In fact, some of the world’s coldest countries have the greatest rates of heat pump use; about 60% of buildings in Norway have heat pumps, while over 40% of buildings in Sweden and Finland use heat pumps^[4].

Heating and cooling usually accounts for around half of the energy use in a typical U.S. home, making it the largest energy-related expense for most households. To help New Yorkers make the switch and save on energy, heat pumps are bolstered by a variety of State incentives and tax credits, and Federal IRA tax credits, including:

Visit NYS Clean Heat for a comprehensive list of the State and utility heat pump incentives available.

Heat Pump Technology	Federal IRA Tax Credit (2023-2032)	New York State Incentives and Tax Credits
Cold-Climate Air Source Heat Pump	30% of cost, up to $2,000 per year	Incentives: Partial home solutions $100-$400 on average Whole home solutions $2,000-$3,000 on average
Ground Source (Geothermal) Heat Pump	30% of cost	Incentives: $7,000-$9,000 on average Tax Credit: 25% of cost, up to $5,000
Heat Pump Water Heater	30% of cost, up to $2,000 per year	Incentives: $700-$1,000 on average

Beginning the heat pump journey with a home energy assessment, which is free for all New Yorkers, is good practice to get a full picture of a building’s energy performance and potential health or safety issues. As part of the assessment, homeowners receive a customized list of recommendations to improve efficiency and save energy. Addressing any issues like drafty air leaks prior to designing a system is a heat pump installation best practice .

Depending on the building characteristics, energy efficiency improvements, such as air sealing and insulation, may be a recommended first step to get immediate energy savings and better performance (i.e., more savings) from a future heat pump installation. Through the Comfort Home Program, homeowners can access incentives for installing “seal and insulate” packages, with more comprehensive efficiency packages granting larger incentives.

Taking a further step to combine a heat pump with solar and energy storage can maximize energy bill savings while providing an emission-free electricity source and back-up power.

Footnotes

1. Olano, M. V. (2023a, February 10). Chart: Americans bought more heat pumps than gas furnaces last year. Canary Media. https://www.canarymedia.com/articles/heat-pumps/chart-americans-bought-more-heat-pumps-than-gas-furnaces-last-year Back to content
2. Department of Public Service. “The NYS Clean Heat Program 2022 Annual Report.” Back to content
3. New York State Climate Action Council. 2022. “New York State Climate Action Council Scoping Plan.” https://climate.ny.gov/resources/scoping-plan/  Back to content
4. IEA. (n.d.). Executive summary – the future of heat pumps – analysis. IEA. https://www.iea.org/reports/the-future-of-heat-pumps/executive-summary Back to content