Karl Pomeroy, President and GM, Motili. Show
getty If you’re a regular reader of my Forbes column, you know the upcoming January 2023 HVAC regulation changes and new minimum efficiency standards have been a key focus of mine for the past few months. In today’s environment of supply chain shortages, delays and rising prices, building owners and operators need to know about the effect the new minimum efficiency standards for heat pumps and air conditioners could have on organizations and homeowners. I believe these upcoming changes could have a significant impact on the environment and the budgetary bottom line, so it's important HVAC companies are ready as well. As I have previously discussed, the new minimum efficiency standards for residential air conditioners will follow regional borders that were established in 2015. For air conditioners in the northern part of the U.S., the minimum efficiency will increase to 14 SEER; in the South, the minimum efficiency will increase 15 SEER. The new standards also "require an increase in the heating efficiency of air-source heat pumps—measured by the equipment’s heating seasonal performance factor," according to the U.S. Energy Information Administration. The minimum HSPF will increase from the current standard of 8.2 to 8.8. Considerations For Building Owners One of the points I want to reiterate about the regulation changes is that it is imperative building owners and operators are aware of which units they are purchasing and their install date. Before making any purchases, especially as we head in the spring and summer months, consider: • If you are buying units based on pre-2023 standards, install them prior to December 31. • The units you purchase should support the new minimum efficiency standards effective January 1. Considerations For The HVAC Industry If you are in the HVAC business, now is the time for field techs to educate themselves on the new minimum efficiency standards and what the rules are for the regions they service. It will also become increasingly important in the next few months for contractors to understand what stock is available or when it will become available—and to be confident about the timeline of delivery. As we get deeper into 2022, contractors will have to make educated choices about which units they will or will not be able to install with the January 1 deadline looming ahead. From my perspective, product procurement will come with price increases that will likely continue to trend upward as the year goes on. I also expect supply chain issues to continue to impact product acquisition. I believe higher performance components, new fan systems and increased unit chassis sizes will bring a need for an increase in commodities, such as copper and plastic for newer, bigger systems. That equates to higher acquisition costs. With this in mind, I believe the HVAC industry also must continue to educate its customers and potential customers, as these changes are just around the corner. Reach out to customers and ensure they understand the regulations for 2023 and beyond, ask about the condition of their in-place HVAC systems and consider offering to inspect it. These are additional ways industry leaders can deliver the message of change and the potential impact these new regulations could have on everyone, ranging from the single-family homeowner to the multi-family and commercial property owner. One Final Note For HVAC And Refrigerants The new HVAC unit regulation changes will likely be followed by more refrigerant changes in the future. To review, beginning in 2020, only recovered, recycled or reclaimed supplies of R-22, a hydrocarbon refrigerant, were and are available for legacy systems, and I'm finding the price for it continues to climb. I also expect a reduction in the availability of the R-410A refrigerant next year, as that's when the new HVAC standards kick in. As the HVAC industry goes through the process of transitioning to next-generation refrigerants, long-term planning and legacy unit replacement come into play. Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify? Follow me on LinkedIn. Check out my website.  With the ongoing impacts of shipping delays, price inflation, and supply chain shortages, the last thing HVAC professionals need right now is to be unprepared for upcoming 2023 HVAC industry regulation changes. These forthcoming regulations entail new minimum efficiency standards for heat pumps and air conditioners that can affect how to conduct business in the new year. Because of these recent regulations, it would be wise for HVAC professionals to understand the exact details of what's to come to best adjust their business finances and operations. So keep reading to learn more about these 2023 HVAC regulation changes and how to best prepare. So, What's Happening in 2023?An undertaking by the U.S. Department of Energy (DOE), new regulations have been passed to require HVAC professionals to meet minimum efficiency requirements by January 2023. These new regulations have increased the federal minimum Seasonal Energy Efficiency Ratio (SEER) efficiency requirements for customer air conditioning systems and heat pumps. SEER is an efficiency measurement used to monitor the amount of expected energy output per year for an HVAC unit. So, what elements of SEER will change? Under current 2022 regulations, the minimum efficiency for new HVAC air conditioner installations is 13.0 SEER in Northern U.S. locations and 14.0 SEER for Southern areas. However, come January 2023, HVAC professionals will only be allowed to install HVAC systems that possess a minimum 14.0 SEER rating for the North and 15.0 SEER for the South, an increase of 1 unit. In addition to air conditioning units, heat pump systems are also undergoing regulatory changes in 2023. Under upcoming regulations, a heat pump system must possess a minimum SEER efficiency rating of 15.0, compared to the current 14.0. Likewise, air-source heat pumps will also see a rating increase under the Heating Seasonal Performance Factor (HSPF) measurement method, from 8.2 to 28.8. Who's Ready in the HVAC Industry Space?The upcoming 2023 regulatory changes seem pretty straightforward; however, you may be surprised to learn the level of awareness and preparedness (or lack thereof) across the industry. For example, leading industrial, commercial, and consumer HVAC manufacturer Emerson recently surveyed SEER efficiency requirement updates among HVAC contractors and wholesalers. The survey found that roughly 87% of HVAC professionals were aware of the upcoming 2023 changes, a pretty strong number considering the numerous industry distractions and delays we've encountered recently. On the other hand, the Emerson survey also questioned HVAC professionals on their level of preparedness for the upcoming 2023 regulatory changes. Roughly 44% of survey participants claimed they hadn't created any plan of action for their HVAC business to navigate the upcoming changes. With nearly half of the survey participants having no actionable plan in place, it's more vital than ever to use the remaining months of the year to construct one. This preparation could not only save you valuable time come 2023 but also some pretty steep costs that could be in store due to ongoing supply chain interruptions and COVID-19-related delays. What Can HVAC Professionals Do to Prepare for These Changes?For those with minimal to no established course of action for the upcoming 2023 minimum efficiency regulation updates, there are a few steps you can take to best prepare before the new year. For one, start by initiating some education efforts. Gather your office staff and field technicians for a quick meeting to educate your team on the upcoming minimum efficiency updates and the specific rules that pertain to your business location. With your team properly aligned and well aware of the upcoming changes, be sure to do the same for your current customers. From communicating updates in person during service visits to digitally through a monthly newsletter, this insight is crucial to what customers can expect with service updates and requirements come 2023. This insight also creates an opportunity to have customers reach out with any questions regarding their older units and to offer inspection services. When capping off your 2023 minimum efficiency regulations plan, you must consider how you will obtain systems that comply with the new law. As the HVAC industry has been troubled by ongoing supply chain and manufacturing delays, now would be a good time to discuss the current availability of compliant systems and tentative restocks with your distributor. In addition, with higher performance systems in higher demand, expect possible delays and cost increases in 2023. Don't Let 2023 Changes Surprise Your HVAC BusinessWith the provided details surrounding the upcoming 2023 minimum efficiency requirements for HVAC equipment, there's no reason for you not to begin to prepare your business for this update. From educating team members and clients to discussing with distributors regarding ongoing availability, these simple steps will set you up for success come 2023. Not sure where to start with your 2023 plans? Check out the JB Dealer Services Marketplace for tools that can help streamline your day-to-day operations and help prepare for the year ahead. Are HVAC systems changing in 2023?The U.S. Department of Energy (DOE) will begin enforcing new efficiency standards for split-system air conditioners and split-system heat pumps on January 1, 2023. The new regulations and timing vary by region. Your preferred Lennox dealer will know how the new rules impact your state.
Will HVAC prices go down in 2023?HVAC industry alerts are now warning of significant price increases for 2023. There are four reasons for this increase: The cooling equipment components will perform higher to achieve a high-efficiency rating. This is a good thing as these components generally have higher quality and will last longer.
What will be the new refrigerant in 2023?In 2010 when I started my venture into the HVAC industry, I was coming in during a time of transition. Our industry was changing from systems that had R-22 refrigerant circulating through their lines to R-410a.
Should I wait until 2023 to install a heat pump?New energy incentives make this a great time to install or upgrade a heat pump. The year 2023 may be the best for homeowners buying a new heat pump. The new Inflation Reduction Act (IRA) includes incentives for upgrading a home's energy efficiency, including tax rebates and discounted purchasing.
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