Update on ICAST’s Program to Deploy Heat Pumps in Multifamily Housing

ICAST is nearing the end of its program to catalyze the mass adoption of very high-efficiency (VHE) heat pump HVAC systems and water heaters in multifamily (MF) housing, especially MF affordable housing (MFAH). It installs thousands of VHE heat pumps in MF and MFAH each year. However, with funding from the U.S. Dept. of Energy’s Building Technologies Office, it has been conducting real-time monitoring of these solutions at five of its MF sites in various property types and climate zones and comparing them to conventional systems. ICAST installed heat pump HVAC (HP HVAC) at all five sites and installed heat pump water heaters (HPWHs) at one of the sites. There is some work to do before ICAST concludes the program. However, some key findings to date are summarized below:

• Energy savings achieved from HP HVAC can be significant (upwards of 70%), and savings were often most significant for homes switching from electric resistance (ER) furnaces and central air conditioners (CAC). Because ER furnaces are deeply inefficient, this result was expected.
• At every site where ICAST replaced ER furnaces and CACs, it found that if customers were to base their HVAC upgrade decisions solely on financial considerations, it would be better to install a new VHE heat pump than to go with a “business as usual” ER and CAC combo.
• Through resident surveys, ICAST found that typically, 75-100% of residents reported lower utility costs after having VHE heat pumps installed. It also found that at least a majority of respondents in every survey (and often 100%) preferred the heat pumps to their old systems.
• Full or partial electrification of a gas system can sometimes result in larger utility bills. At one site, ICAST replaced gas furnaces with VHE heat pumps and new gas furnace back-ups to deliver “dual fuel” systems. Because gas has historically been so much cheaper than electricity, this result was unsurprising. While we expect this trend to reverse, in the interim, it is crucial for property owners thinking about “going electric” to consider the full range of measures that can increase overall energy efficiency at their property, including weatherization and PV solar. This will help them reduce or eliminate energy waste, get right-sized HP HVAC upgrades, and drive the deepest energy savings and, therefore, utility bill savings. ICAST delivered additional energy efficiency upgrades at all apartments at this site; however, because those savings fell outside the scope of the project (i.e., direct comparison of the VHE and conventional HVAC types), they were excluded from the savings calculations.

The Inflation Reduction Act and Bipartisan Infrastructure Law have provided billions of dollars for weatherization, solar, electrification, and much more. This is a once-in-a-lifetime opportunity for MFAH property owners to take advantage of new or enhanced tax credits, rebates, and incentives to pursue green upgrades. Technology such as VHE heat pumps can help cut costs (capital, operating, and maintenance); improve NOI; and increase health, safety, and affordability for tenants. ICAST will soon include its case studies in the Heat Pump Resource Guide it developed for the VHE program. The Guide is designed to help MF owners and managers, policymakers, utilities, energy efficiency program implementers, and others scale VHE heat pumps in the MF segment. It is currently available on ICAST’s site. Download it here.