In Win for Heat Pumps, Energy Star Likely to Decertify Furnaces and Air Conditioners

If you’re in the market for a new air conditioner or furnace, you might soon have trouble finding any with that cheery blue star telling you which models will save money on your energy bills.

The Biden administration has proposed making a major, market-moving change to the Energy Star program, which gives a stamp of approval to the most energy-efficient appliances. In a memo published in mid-May that’s flown under the radar, the Environmental Protection Agency said it wanted to take central A/Cs and residential gas furnaces out of the running for Energy Star altogether. Instead, the certification program would steer consumers to heat pumps, electric appliances that are akin to combination A/Cs and furnaces because they can both heat and cool a home.

Thanks to the Inflation Reduction Act, which created rebates and tax credits to help people cut emissions by switching to heat pumps and other electric appliances, the EPA sees an “unprecedented opportunity” and an “important responsibility” to support this transition through the Energy Star program, the memo says.

“I’m very excited about it,” Matt Malinowski, the director of climate research at CLASP, a nonprofit that advocates for energy efficiency in the U.S. and abroad, told me.

The EPA proposal cites research conducted by Malinowski and others which found that if every homeowner looking to replace their central air conditioner in the next 10 years bought a heat pump instead, and used it for heating as well as cooling, that alone could cut direct emissions from homes by about 50 million tons, or 15%, annually by 2032. The average home would see a whopping 39% reduction in fossil fuel consumption, and homeowners would save a collective $27 billion on their energy bills, the report found.

“I liken Energy Star to the ‘easy’ button from the Staples advertisement,” said Malinowski. “It’s just a simple thing that people can tell whether a product is efficient or not.”

If the change is finalized, EPA would stop certifying new furnace and central A/C models by the end of this year, and would sunset the two programs entirely by the end of 2024.

The agency is accepting comments on the proposal until June 22, and it’s likely to face pushback from the gas industry. In an email, Richard Meyer, the Vice President of Energy Markets, Analysis, and Standards at the American Gas Association told me the proposal was “ill-considered and would harm the EPA’s equipment and utility partners, deprive consumers of accurate information about efficient residential heating equipment, and lead to higher energy use and emissions for many consumers.”

However, installing a heat pump instead of a central A/C or furnace would likely reduce energy use and emissions for most customers. EPA notes they can be “as much as four times more efficient than even the most efficient condensing gas furnaces,” which means they can reduce greenhouse gas emissions even if the electricity was generated by burning fossil fuels. The benefits EPA highlights also include energy security and cleaner air, since they can be powered by domestic, renewable electricity.

There are already a few places that have created mandatory requirements to replace regular air conditioners with heat pumps such as Vancouver, British Columbia, and San Mateo, California, which put the rule into their building codes. The theory is, if you’re going to replace your air conditioner anyway, why not get something that can take care of some of your heating needs as well? “This approach really won't leave you any worse off than you would be otherwise, versus replacing that air conditioner with just another air conditioner,” said Malinowski.

The Energy Star change would be more of a nudge, not an ultimatum. Companies won’t have to stop making traditional air conditioners or furnaces, and people will still be able to buy them. (Nor will the change affect window a/c units.) Homeowners in chillier parts of the country might also decide to keep their existing gas-powered furnace or boiler as a back-up, particularly if they can’t afford the more expensive heat pumps designed for the coldest climates.

But it would likely have ripple effects. Many utilities that have their own incentive programs use Energy Star ratings to decide which products qualify, so the EPA’s change could drive more rebates to heat pumps beyond state or federal incentives.

The Energy Star label is also a market signal that manufacturers follow to update their product lines. Nate Adams, a contractor and well-known electrification advocate who contributed to the CLASP report, likened the idea of sunsetting the Energy Star rating for furnaces and central A/Cs to a “change in the wind.”

“The weather changes when the wind changes, that's what this is,” he said. “A shift in the direction of things.”