U.S. DEPARTMENT OF ENERGY
SOLAR MARKET PATHWAYS PROGRAM
VERMONT SOLAR DEPLOYMENT PLAN
FOCUS AREA BRIEF
OUTLINE
HEAT PUMPS
May 26, 2015
INTRODUCTION
Electric heating has not been a viable option in Vermont because electric resistance heat costs
more than any other fuel, and heat pumps were not able to function in cold winter temperatures.
New cold climate heat pumps address both issues, operating more than twice as efficiently as
resistance heat, and capable of working down to extremely low temperatures. This means solar
can be converted efficiently and cost effectively to space heating and cooling, as well as water
heating. This strategy is being used in net zero energy new construction as well as in retrofits.
Lower solar costs make this competitive with fossil fuels and biomass.
TECHNOLOGY AND MARKET DESCRIPTION
Heat pumps use electricity to move heat. There are many variations but the focus here is on air
source heat pumps that use energy in outdoor air to provide space heating and cooling. Heat
pump water heaters are analogous and are another aspect of growing electrification in the state.
Figure 1 - Annual Savings for a typical home (75 MMBtu/yr)
The economics are most compelling for homes using one of the fuels highlighted in Figure 1 for
heating. For homes with the more expensive heating fuels, a heat pump could be paid off in as
little as four or five years. Costs are near even for natural gas and wood, so people will not rush
to switch, but may consider heat pumps when replacing failed systems.
Heat pumps are least efficient when outdoor temperatures are very high or low, so they
contribute to peak problems. Currently in Vermont winter peak is not a concern, but both peaks
are growing and the summer peak is an issue in some areas. Controls and solar can both help
with the summer peak.
MARKET CONDITIONS — OPPORTUNITIES
AND
CHALLENGES
Growth
Vermonters are very excited about heat pumps to displace fossil fuel heating:
GMP’s lease program took more than 600 calls in the first few days and had to stop taking calls.
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Sales of residential split systems are growing with awareness:
Technical Advances
Cold climate heat pumps are developing quickly. Initially only available as single head units,
multi-zone, multi-head systems are now available. These come with more installation options for
the indoor units that address some of the barriers listed below. Soon, heat pumps designed to
connect to conventional duct and water pipe distribution systems will be available as well as
combined space and water heating systems. These improvements increase the number of
homes and businesses that can use the technology.
Efficiency is also increasing. Carbon dioxide as a highly efficient and lower impact refrigerant is
being developed. Solid state heat pumps are another focus of research. In Vermont, heat from
heat pumps currently costs less than all fuels except cord wood and natural gas. With
increasing efficiency, heat pumps may overtake these two, again expanding their potential
market.
Adapted from Vermont Fuel Price Report, PSD
MARKET CONDITIONS — CHALLENGES
Barriers
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Perception that heat pumps don’t work in Vermont’s climate
Financing may be required for upfront cost
Many older homes need weatherization, or don’t have open floor plan so cannot be
effectively heated from a point source
Aesthetic effect of indoor and outdoor units compared to traditional heating systems
hidden in basements
Overcoming barriers
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Education about heat pumps’ capabilities and applications
Weatherization assistance
Future heat pumps that connect to ducted and hydronic distribution systems.
MARKET CONDITIONS — COSTS
Costs
As contractors get more familiar with the technology, costs will come down. There have been
some group buying efforts similar to those for solar. Contractors are combining heat pump and
solar projects, gaining customers for both markets and rolling projects into attractive cash flow
neutral loans.
SCENARIO INPUTS
Inputs for Scenario Analyses
Table 1. Scenario data structure table for heat pumps
Current Account / Historic Data
applicable market segments
Residential Market - fossil fuel displacement -commercial
market uncertain - restaurant application - LIHEAP - 40-45k
households - multifamily -retrofit and new construction
number of units, and market
share by type
low lease penetration with GMP program, 6k CCHPs
installed in Maine, collect information on EVT incentives,
GMP goal of 750 heat pumps leased by end of 2015 - Kirk
Shields, Home Performance
Typical load profiles, annual
Carol H. - winter peak not a concern right now - work on
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consumption, annual production
reworking load shape via Itron inc.
Type of growth
Exponential
Changes in Performance
Characteristics
Higher efficiency units - CO2 as refrigerant with higher
COP - solid state heat pumps - Sanden and other air to
water heat pumps -
Costs
Installation cost reduction as our HVAC Technicians
become more familiar with the equipment - more
competition in the market place - equipment costs should
come down with improved efficiency
Technical or Market Elements
Controlling units remotely to shape loads - is it the most
cost-effective way to reduce peaks or is battery banks to
smooth out loads better, as an example.
Top Three Issues
Peak load impacts
forecast the possible negative impacts on peak load
Source of the energy
Movement away from dirty energy
Equipment Obsolescence
new equipment outperforming existing equipment and that
equipment removed before end of useful life
Incentives
allowing market to transform itself
Manufacturers
Service support - recall communication
UNMET NEEDS
More information needed
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Utility plans for controls or rates to manage peak
Cost projections for equipment and fuels
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