January 21, 2010 10:54 ET

Green HVAC Gains in Energy-Efficient Geothermal Installations

NEW YORK, NY--(Marketwire - January 21, 2010) - Following a decade of historic double-digit growth, the heating, ventilating, and air conditioning (HVAC) market in the United States began a descent in 2007 parallel to housing, credit, and employment collapses.

However, the industry is expected to see growth again as tax credits from the American Recovery and Reinvestment Act (ARRA) help more consumers buy new and existing homes and update existing systems, according to "HVAC, 2nd Edition -- Green and Global," the latest report from leading energy market research firm SBI Energy. The green HVAC market should benefit in particular from federal and state support of more energy efficient homes and buildings.

International manufacturers of HVAC devices seek to capitalize on the impending uptick in the market by designing high-efficiency equipment for sale in the U.S. that exceed the 13 SEER (Seasonal Energy Efficiency Ratio) minimum standard that was established by the Department of Energy (DOE) in January 2006. Such equipment would qualify for the higher standards required to receive the tax credits available through the ARRA.

"We project that the market supply of U.S. HVAC shipments should grow at a CAGR (compound annual growth rate) of 4% to reach $14 billion by 2014," says Shelley Carr, publisher of SBI Energy. "Growth will be driven primarily by the residential and non-residential construction markets. In addition, tax credits, new HVAC innovations, global expansion, and renewed investment in the replacement sector will revitalize the market."

Recent developments in HVAC technologies have been primarily driven by plausible solutions to a global energy shortage and an impending sense of environmental emergency. Focus has also been on reducing operation costs, as well as increasing productivity and state-of-the-art comfort, leading to expedient and cutting-edge technology. New technologies, such as geothermal heat pumps, under-floor air distribution, and building integrated photovoltaic systems hold the key to future HVAC product developments.

Thanks to the ARRA, homeowners can receive tax credits of up to 30% of the total cost of the installation of a geothermal HVAC system for geothermal heat pumps placed in service before December 31, 2016. The DOE estimates that around 35,000 geothermal/ground-source heat pumps were installed in 2007, despite relatively high initial costs compared to standard heat pumps. By 2009, the number of geothermal/ground-source heat pump installations had reached an average of 90,264 per year.

According to the DOE, the average home spends about $1,900 annually on energy bills. Heating and cooling accounts for as much as half of a home's energy use. The DOE estimates that homeowners can reduce their energy bills by up to 20% merely by replacing furnaces, boilers, central air conditioners and heat pumps with more efficient models.

"HVAC, 2nd Edition -- Green and Global" examines the effects of the global recession on investment in commercial and residential HVAC installations. It features imports and exports of HVAC equipment from 2004-2009 and forecasts 2010-2014 as well as industry trends, opportunities and the incentives being offered for more efficient commercial and non-commercial (residential) buildings throughout the United States. For further information, visit:

About SBI Energy

SBI Energy (Specialists in Business Information), a division of, publishes research reports in the industrial, energy, building/construction, and automotive/transportation markets. SBI Energy also offers a full range of custom research services. To learn more, visit Follow us on LinkedIn and Twitter.

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