You’ve seen it everywhere: HVAC prices are increasing in 2025.
But why? And what does that mean for your customers? For your business?
New EPA regulations mandate that all new HVAC units use a safer and more efficient refrigerant called Puron Advance starting January 1, 2025. The kicker? Not only can manufacturers not build ducted or ductless equipment using R-410A (Puron) refrigerant, but no units using Puron can be installed, either.
With the looming price increase, many HVAC professionals are preparing for a shift in their business and how they need to approach customers. Some homeowners might struggle with the higher costs up front. Fortunately, contractors who offer financing through Hearth can help bridge the gap.
Ready to learn more about the benefits of Hearth financing? Sign up for a demo today.
How the American Innovation and Manufacturing (AIM) Act Affects HVAC
The Environmental Protection Agency (EPA) has implemented significant changes to the refrigerants used in HVAC systems as part of its ongoing efforts to reduce greenhouse gas emissions. A key focus is the phasedown of hydrofluorocarbons (HFCs), including R-410A refrigerant, under the American Innovation and Manufacturing (AIM) Act. Enacted at the end of 2020, the AIM Act’s goal is to seriously decrease, if not eliminate, the use of refrigerants with dangerous HFCs across various industries by 2036. Starting in 2025, the production and importation of R-410A will be sharply reduced, causing ripple effects across the HVAC industry.
Prices across the HVAC industry could increase by as much as 30% starting January 1, 2025, making your customer’s affordability a more serious consideration than ever before.
What Does the EPA Mandate Entail?
The AIM Act requires a 40% reduction in the production and import of HFCs by 2024, with further reductions in subsequent years. By 2025, manufacturers will be transitioning away from R-410A to newer refrigerants, such as R-32, R-454B, and R-466A, which have significantly lower global warming potential (GWPs).
The mandate will affect HVAC prices in 2025 in the following ways:
- Increased Costs of R-410A Refrigerant: The reduced supply of R-410A will likely lead to higher prices. Homeowners with existing HVAC systems that rely on R-410A may face increased costs for repairs or recharges.
- Higher Equipment Prices: HVAC manufacturers are shifting production to equipment compatible with newer refrigerants. These systems often incorporate updated technology, which may result in higher upfront costs for consumers. However, newer systems are typically more energy-efficient, which could offset some of the initial expense through lower utility bills.
- Installation and Maintenance Costs: Technicians will need to be trained to handle new refrigerants and updated equipment. This may lead to increased service costs due to the specialized knowledge required for installation and maintenance.
- Potential Shortages and Delays: The transition period could cause temporary supply chain disruptions, resulting in shortages of both refrigerants and compatible HVAC equipment. This may drive up prices and lead to delays in installation or repair services.
The Dangers of Hydrofluorocarbons
Many homeowners might question the need for the change in policy that so significantly impacts the prices of HVAC systems. The fact is that hydrofluorocarbons are dangerous greenhouse gases that have hundreds or even thousands of times the heat-trapping ability of carbon dioxide, and they are currently the fastest growing climate pollutant affecting our planet.
The Long-Term Outlook of the R-410a Refrigerant Ban
While the EPA’s mandate will bring initial challenges, it ultimately aims to promote sustainability and reduce the HVAC industry’s environmental impact. Transitioning to energy-efficient systems using low-GWP refrigerants will not only help combat climate change but also lower operating costs for consumers over time.
Fortunately, HVAC companies have options like Hearth financing to help make the transition smoother. With intuitive tools, no dealer fees, and a simple qualification process for your customers, Hearth makes sticker shock a thing of the past.
Get ready for the 2025 HVAC price increase with Hearth financing. Contact us today to learn more.
