Steel For Fuel N° 020 of 56 30 Aug 2024
HVAC: the next frontier
by Andy Lubershane, Partner and Head of Research, Energy Impact Partners
In this note
The question
Where does the next big block of building energy efficiency come from, as the stock of light bulbs left to swap out for LEDs begins to dwindle?
The answer
Heating, ventilation and air conditioning. Lubershane argues the equipment still has large efficiency headroom despite being mass-produced and mature, and that demand is rising hard on both the heating and cooling sides.
03The argument
For fifteen years, he writes, energy efficiency has effectively meant LED lighting, which anyone carrying an efficiency target could lean on. That well begins to run dry as the remaining bulbs get swapped out, and his case is that heating and cooling take over. Demand is why it matters. Cooling grows because the world is getting hotter and richer at once and because population growth is concentrated in places that are already hot, and air conditioning is among the first goods households in hot climates buy on entering the middle class, a pattern he treats as close to a natural law. In cooler climates the weight sits on heating instead, and he argues that decarbonizing that heat affordably needs more efficient equipment rather than only cleaner supply. The supply side is the surprise. Heat pumps are already a mass-manufactured commodity in forms from refrigerators to central air conditioners, which would normally mean a mature technology with little room left in it. His two examples are the evidence that it is still there: a dedicated outdoor air system from Transaera, built on a novel material, and a mini split from Quilt.
04What you need to know first
- Dedicated outdoor air system
- Building equipment that brings fresh outside air in and dries it on the way.
- Metal organic framework
- The class of material the post calls new and exciting, and what Transaera uses to do the drying.
05Details worth keeping
- Transaera’s design point is deliberate ordinariness: roughly the size and weight of today’s commercial units, drop-in, needing no special accommodation to install.
- Quilt’s product is a two-zone mini split, a heat pump serving two spaces. The company is two years old, and he says its test data does not capture the sensing and controls shipped with the unit.
- Both magnitudes sit in charts, not prose: an outside lab test for Transaera and an uncaptioned chart for Quilt. This note cannot carry either number.
06Claims worth citing
All figures as stated on 2024-08-30.
- In the United States roughly 4% of primary energy goes to cooling and 13% to space and water heating. Lubershane
- The International Energy Agency’s baseline outlook for global cooling demand forecasts adding an entire US electricity sector’s worth of new demand by mid-century. IEA, cited by Lubershane
- Hundreds of millions of heat pumps are made every year across all form factors. Lubershane
- Quilt’s mini split is the most efficient on the market, and Transaera’s unit beats incumbent systems on dehumidification efficiency by a wide margin. Both are his readings of the portfolio companies’ own test results. Lubershane
07Where it’s contested
Nothing is disputed and there is no second voice. Lubershane twice marks his position as conviction rather than finding: that HVAC step-changes are among the biggest levers for smoothing decarbonization, and that HVAC succeeds LED as the next efficiency frontier. The premise that the LED opportunity is running out carries the framing and is asserted rather than shown. Both results are launch-stage tests: Transaera has one customer installation, and no operating data is reported for either product.