The Race to Tesla-ify Heat Pumps

Gleaming solar panels, soaring wind turbines, sleek electric cars. These are the Avengers of the climate technoverse, the most widely recognized symbols of the fight to kick fossil fuels and halt global warming. But the lineup is incomplete. Clean electricity and transportation are covered, but what about heat?

There’s a clear emerging hero waiting in the wings to warm our buildings without emissions. It’s called a heat pump, and it’s a technology that’s been around for decades. The problem is that heat pumps are still largely unfamiliar to most Americans, and the process of trying to get them installed can be a nightmare.

A new cohort of Silicon Valley entrepreneurs is trying to change that by applying a proven formula. The idea is not just to build a better heat pump, but to make one that’s as attractive, convenient, and envy-inducing as a Tesla.

“That’s the only way you win, right?” said Paul Lambert, the founder and CEO of the startup Quilt, which recently raised $9 million in seed funding from Lowercarbon Capital and other investors. “You almost need, like, this Trojan horse. You need to be able to convince people who are skeptical. It needs to be better on its own merits.”

Heat pumps are key to tackling climate change because they run fully on electricity, are far more energy efficient than furnaces and boilers, and function as air conditioners in addition to heaters. Rather than warming a room by means of an electrical current or a flame, they move latent heat around, transferring it either inside or outside of the building, depending on the season.

Only about 16 percent of American homes use heat pumps today, according to the advocacy group Rewiring America. In a recent report, the organization estimated that in order to achieve the U.S. climate goal of net-zero emissions by 2050, heat pump sales need to grow three times faster than they’re expected to by 2032 and to take over the entire residential heating market by 2035. New federal tax credits and rebates created by last year’s Inflation Reduction Act will help, but likely won’t be enough.

“It's going to require lots of new choices for people and continued improvement in all aspects of product design,” Rewiring America’s head of market transformation Stephen Pantano told me. “So the more people investing in this and paying attention to this, the better.”

Despite their technological wizardry, heat pumps are rather dull looking. Some are big metal boxes that get hidden in an attic or closet and push hot or cool air through ducts and vents, while other models require mounting a rectangular hunk of plastic on the wall of every room. Quilt is redesigning the latter.

It’s unclear whether a heat pump could ever achieve the cultural capital of a sports car, no matter how nice it looks. Pantano recalled the scene in Home Alone where Kevin goes looking for his parents in the basement, and the glowing maw of the furnace sends him running. “I think that represents the way a lot of people think about their heating systems, which is that they don't, until they have to, which is usually when it breaks.”

Nonetheless, the heat pumps on the market now aren’t exactly turning heads.

“Whenever we do want to put a unit on the wall, we always get pushback from the consumer regarding the aesthetics,” said Larry Waters, the president of Electrify My Home, a heat pump installation company in Northern California. That’s one of many reasons Waters prefers selling systems that use ductwork. But every building is different, and that isn’t possible in all cases.

That’s especially true for small apartments or for renters who have no power over their HVAC system. Another startup, Gradient, is trying to serve those segments of the market with an attractive heat pump that sits in the window like an air conditioner. It doesn’t require a professional to install, and hangs over the sill like a saddle, solving a key drawback of the average AC by allowing continued use of the window. Last year, the company won a contract to provide 10,000 units for New York City public housing developments.

A Gradient heat pump.Courtesy Gradient

When I spoke to Gradient’s founder Vince Romanin in the summer of 2021, he also compared his approach to Tesla’s. “People didn’t start off buying electric cars because they’re better for the environment, but because they provided a dramatically different and better experience,” he told me.

Gradient’s heat pump recently hit the market. Emily Grubert, a civil engineer and sociologist at the University of Notre Dame, told me she got one for an unheated and un-air conditioned room in her house where her pet rabbits spend most of their time, and where the temperature fluctuates from below freezing in the winter to more than 100 degrees in the summer. It cost $2,000, took about an hour to install, and so far has maintained a comfortable temperature “through multiple days of 90-plus degree weather.”

A third design-forward heat pump startup, Electric Air, was founded by a former Tesla thermal engineer, and is literally advertising itself as “The Tesla of home heating and cooling.” The company’s other selling point is that it plans to combine regular heat pump functionality with improved air purification.

Electric Air heat pump.Courtesy Electric Air

I recently visited Quilt’s headquarters just south of San Francisco to see how the company’s device was shaping up. There I met Lambert along with his two co-founders, Bill Kee and Matthew Knoll. The trio got acquainted while working at Google, and also all recently became fathers, which they said was a big part of what inspired them to leave the tech giant to work on climate solutions. They guided me over to a wall mounted with a few iterations of heat pump designs, as well as a Mitsubishi mini-split, one of the most popular models currently on the market.

Lambert praised the unit’s efficiency, near-silent operation, and ability to heat and cool a room very quickly. “On the other hand, it’s kind of cheap plastic,” he said, rapping his knuckles on the casing. “And it’s quite tall, which is an issue because in a lot of American homes you can’t fit this in the place where people most want it.”

Quilt’s design is certainly more sleek, but it’s by no means a total overhaul. The company doesn’t plan to make its design public until early next year, so I can’t share much, but the improvements are subtle: A slightly smaller frame, a customizable aesthetic, and a few other bells and whistles added based on feedback from focus groups.

Design wasn’t the only factor in Tesla’s success, and Quilt is working on a number of other upgrades, like user experience. Today, when people install wall-mounted heat pumps in multiple rooms in their house, they each come with a separate remote control that has a ton of buttons and looks straight out of the 1980s. In addition to building a more convenient app to control the settings, the company is developing software that will help customers optimize efficiency based on how they use their homes.

“The areas of efficiency that have been exploited in this space have largely been at the mechanical level,” said Kee. “But we think there's a major gain to be made in efficiency by managing the system with intelligence.”

Quilt is also trying to improve the sales process. In addition to being new fathers, Lambert, Kee, and Knoll all recently went through a great deal of trouble trying to get heat pumps installed in their own buildings. “I had people telling me categorically that they wouldn’t work, or that I had to use my ducts, or that I couldn’t use my ducts,” Kee said. “I was totally disempowered. I just became obsessed with the idea that like, this has to be easier for people to do.”

They hope that the direct-to-consumer model, with transparent pricing and predictable scheduling, will help. But it hinges on building an army of ace partner contractors who know the systems inside and out, which could be quite a challenge. The team at Electrify My Home runs heat pump trainings for other contractors in California. Alex Sloan, the company’s vice president of business operations, told me it’s already an uphill battle getting the workforce to adopt existing technology, and to learn to do higher quality installations.

That just may be the one issue a Tesla makeover alone can’t solve.