2023 was a big year for HVAC between the EPA’s final rule about the installation of R-410A split systems and the rise of artificial intelligence (AI) in seemingly all aspects of life. With an ever-changing regulatory landscape, 2024 is bound to bring even more changes. 

This tech tip will recap the changes we’ve seen in 2023 and go over the ones we can expect in 2024 and beyond. A lot of these topics will be discussed by industry experts at the 2024 AHR Expo’s annual HVACR State of the Industry Panel, so you can think of this as a sneak peek at the concepts and a look at the hot topics in the industry. 

Regulatory Changes

Let’s start off with everyone’s *favorite* part of the industry: the regulatory landscape. 

2023 and 2024 are big years for the industry in terms of regulations, whether new regulations have been introduced, are coming into effect, or have truly started to take shape within the last 12 months. There are three main ones that we ought to be aware of going into 2024 and beyond.

SEER2 and M1 Testing Procedures

As you may know, the U.S. Department of Energy (DOE) changed the testing conditions for new equipment. They developed these standards in 2016 and put them into effect in 2023. 

These new tests changed the default energy usage (365 watts per 1000 CFM to 441 watts per 1000 CFM) and more closely simulated field conditions for ducted units (0.5” WC of static pressure), and we needed to rethink the way we determined efficiency as a result. These new M1 testing protocols gave way to SEER2, which consists of ratings that are usually a bit lower than their SEER counterparts due to the higher test static pressure. (For example, 19 SEER systems are closer to 17 SEER2, and 14 SEER is closer to 13.4 SEER2.)

There were also new regional efficiency requirements, with the Southeast, Southwest, and North regions of the United States differing slightly. The North region sets the federal standard, but the other regions may have higher minimum energy requirements for their climate. For example, new AC units in the Southeast and Southwest must have a minimum SEER2 rating of 14.3 despite the minimum SEER2 rating for AC units in the North being 13.4. All heat pumps, regardless of region, must have a minimum SEER2 rating of 14.3.

The M1 transition also distinguished the manufacturing date from the installation date. Equipment manufactured before January 1, 2023, is allowed to be installed in the North, as it was grandfathered in. Equipment manufactured after the effective date of the M1 transition must meet the SEER2 standards. In the Southeast and Southwest, equipment installed after January 1, 2023, must meet the SEER2 standards, regardless of the manufacturing date. 

Phase 2 of the HFC Reduction in the AIM Act

The next phase of the AIM Act is slated to happen this year. We saw a 10% reduction in R-410A (and other higher-GWP HFCs) in 2022, and we’ve gone into 2024 with another 30% reduction. 

So far, R-410A production has decreased by 40%, and it’s only at 60% of the level it was at in 2021. That means we’ll inevitably experience higher R-410A prices, though organizations like HARDI aren’t predicting the full force of this change to be felt until midway through the year.

That said, reclaiming refrigerant is going to become a lot more important in the years to come. Even though the production of R-410A isn’t slated to be completely outlawed, it’ll still end up being 15% of what it was in 2021. 

Refrigerant recovery and reclamation will become a lot more important as we get further into the phasedown.

Update to the EPA’s Final Rule

Last year, the EPA released a final rule banning the installation of R-410A split systems on January 1st, 2025. HVAC School had a livestream with Don Gillis & Chuck Allgood from Chemours and Jason Obrzut from ESCO Institute explaining the future of R-410A, which you can watch HERE (or read the Cliffnotes tech tip HERE).

One of the conditions of the final rule was that parts for R-410A equipment could be installed indefinitely. While it seems like we could circumvent the ban on installation by selling condensers and air handlers as parts, the M1 testing procedures and SEER2 standards can get in the way. We will need new condensers to be compliant with the DOE regulations, and that doesn’t even cover the warranty headaches of installing systems as components.

Needless to say, this change alarmed many contractors who would’ve lost money on uninstalled, unusable equipment. Not to mention, the metals in landfilled equipment could contaminate local water supplies, which is the exact opposite of the EPA’s mission. (I’ll get off my soap box now…)

Several industry groups and individual contractors pushed back against this decision, including HARDI, ACCA, and everyone who signed the letter I sent to the EPA. 

Thanks to these groups (and you!), the EPA has given us a 1-year sell-through period for residential equipment. The situation may still not be ideal, but it will relieve a little bit of the pressure we were under to sell and install warehoused equipment this year. 

Controls, Automation, and AI

AI is a hot-button topic right now, and it’s no different in our industry, especially in commercial buildings. But AI is just one part of the ever-increasing emphasis on controls and building automation, especially in commercial structures.

Some people can’t get enough of the techy aspects of things, and some people hate them. No matter which side of the fence you’re on, the industry will move toward a greater emphasis on controls, automation, and artificial intelligence. 

But I should make it VERY clear that these things are not going to replace the need for HVAC technicians. The opposite is actually true.

What ARE we going to see, anyway?

In many commercial environments, including large buildings and grocery facilities, we can enhance the HVAC system by making it adapt to changing load conditions. We’ve already seen this to some degree for several years.

Occupancy is a big factor in commercial office buildings, and we can improve energy savings and comfort by allowing equipment performance to respond to the changes in loads. This principle is already very common in VRF/VRV systems, which vary the refrigerant flow to several indoor units based on sensors and inputs. We can also take it a step further with VAV systems, which are variable air volume systems that vary airflow throughout the building via dampers and a thermostat.

However, we can expect the use of building automation systems (BAS) and machine learning (a subset of artificial intelligence) to allow the HVAC/R in commercial structures to get the most bang for its buck. That will be especially important with the introduction of tax credits for energy-efficient building improvements as part of the Inflation Reduction Act. But these same controls exist in residential HVAC, too, especially when we look at zoning systems. (And these same tax-deductible energy credits are available in the residential world, too.)

Basics of Controls

Controls can be incredibly basic mechanical controls, such as a defrost timer with pins that you pull out. We’ve also got controls that respond to changes in the system, such as by picking up temperature and pressure readings. Some of these are also mechanical, like a TXV sensing bulb. Others respond to digital signals sent between the sensors and controller, like an electronic expansion valve.

In some commercial buildings, we even rely on servers to manage all of the inputs and outputs within a building network. Those use technologies like ethernet cables to connect components and wire them into the network.

In any kind of control system, we have three main parts that always follow a specific sequence: a sensor (1) communicates an input to the controller (2), which communicates an output to a component (3) of the system. 

This sequence is usually pretty straightforward when we have things like coil temperature sensors for heat pump defrost; the sensor detects when the coil is frozen so that the thermostat can tell the system to run in cool mode and turn on the auxiliary heat until the coil reaches its setpoint again.

We had a livestream featuring Steve Cook from Hisense, who went into detail about communicating systems and removed some of the mystery surrounding those, including protocols and digital signals. You can watch the livestream HERE or get the cliff-notes version HERE.

BAS

Building automation systems use a central controller to monitor several energy-consuming aspects of a building, including HVAC/R, lighting, and more. 

All BAS systems follow a basic pattern: server, supervisory device, field control, and input/output.

A server runs the software and provides the user interface, which is how people can interact with the system. From there, a supervisory device supervises and consolidates all the field controllers in one area; the field controllers send all of their data to this device. The field controls send inputs and receive outputs. Phil Zito covered that entire process in THIS podcast.

While it may seem complex on the surface, BAS technicians typically don’t need to know exactly how signals are transmitted from component to controller and vice versa. They just need to know if signals are being transmitted and why they aren’t whenever there is a problem. Think about it this way: we don’t analyze Bluetooth signals if we’re trying to get headsets or other devices to connect to our phones.

Machine Learning

Predictive controls are able to recognize patterns in building and climate conditions to modulate certain system components and optimize performance. These controls can also have data programmed into them to fill in blanks about climate data in a short period of time. 

This type of tool can be especially useful in grocery refrigeration to monitor load patterns and monitor performance. A rack that goes down can cause thousands of dollars worth of product loss, and time is of the essence in these emergency cases. Having data at the ready can speed up troubleshooting. 

The data can tell also technicians about efficiency improvements if the suction is floating enough, or it can show other trends that allow technicians to diagnose more efficiently and target areas that can be improved. Data arms technicians with enough knowledge to help them spend their time doing things that provide more value for their customers. 

Instead of replacing technicians, AI can help technicians use their skills to the greatest effect. It also monitors the signs that can predict catastrophic failures, making the technician’s work even more efficient and valuable. (You can learn more in our podcast about using data to transform cold storage.)

An Entryway for Other Industries

While BAS and AI may intimidate a lot of people, we can actually work with them quite well. We may not realize it, but a lot of us use complicated systems without understanding them, like using Bluetooth to listen to music or take a call in the car. 

When we think of it that way, and when we think of some tactile skills like making crimp connections, we already have an entryway to things like energy management systems (EMS) and BAS.

Even better, these new developments can help create a bridge for people with skills in other industries to enter HVAC, including electricians, IT professionals, and audiovisual professionals. All of those skills come together here, and it could possibly help with the labor shortage we’ve been experiencing in recent years.

Gas Bans & Electrification

Now, I’m sure a lot of you have heard about “gas bans.” Those are two scary words, and it’s reasonable to worry about what might happen. What does the future look like for gas furnaces and stoves? What does that mean for the industry? 

The short of the issue is that some municipalities are prohibiting the installation of new gas meters and hookups. All of this is happening at the local level. However, some states are outlawing these gas bans; just under half of the states have already passed laws to prohibit these bans. (For example, Florida has prohibited gas bans, so a city in Florida cannot forbid new gas hookups.). This ACHR News article, although from 2022, does a great job of explaining the gas bans and sharing opposing viewpoints on the matter.

An ongoing saga as of late has been the story of the Berkeley gas bans, which were overturned by the 9th U.S. Circuit Court of Appeals last April. As of this past week (January 2nd, to be exact), the court denied the request to revisit the issue, and the city of Berkeley cannot enforce the gas bans that were on the books.

In addition, the federal government is providing incentives to encourage the installation of electric appliances, but it is not outlawing gas appliances or removing gas appliances from structures. Even where there are gas bans in place, these bans are on new appliances, not existing ones.

The main takeaway here is that the gas bans aren’t uniform; they’re not going across the country in one fell swoop, and the industry will have to acknowledge that infrastructure and skill divide

Electrification and the Skills Gap

The gas bans are part of the initiative to focus on electrification, with health, safety, and climate benefits being cited as the main reasons for this shift. While electric appliances don’t have the same carbon monoxide and combustion risks as gas-fired appliances, they come with a unique set of challenges, particularly in the early stages of electrification initiatives. 

Professionals who are not familiar with heat pumps may not have the knowledge or skills to install, repair, and maintain electrical appliances properly. That skill deficiency is something our industry needs to address, and that’s an issue that was discussed on the Electrification Panel at last year’s symposium. Duct fabrication is a huge issue, especially because of how much heat is lost via duct leakage, and we need to become more proficient as an industry to make heat pumps work.

Infrastructure Concerns

The strength of the electrical grid is one of the greatest concerns about the gas bans. In many areas where natural gas was the norm, especially for its abundance and low prices, the electrical grid isn’t yet prepared to handle mass electrification.

The buildings themselves also ought to be considered; to get the most out of a heat pump, the building has to be relatively weather-resistant and tight. Historic buildings were built much leakier than our current construction standards would ever allow, and we need to keep that in mind when it comes time to replace existing equipment. As Kimberly Llewellyn said in the Electrification Panel, making heat pumps work will be a collaborative effort with other industries, including the weatherization and construction industries.  

Heat Pumps in Cold Climates

Perhaps even more than the skills gap and insufficient electrical grid, people are also concerned about the capabilities of heat pumps in cold climates.

Heat pumps get kind of a bad rap; even as technology has improved, there’s still this prevailing idea that heat pumps won’t be able to absorb heat from the outdoors in cold climates. There’s also the comfort concern that people won’t feel warm air coming out of their vents. That’s a valid concern in areas that have experienced extreme cold, like Buffalo, New York, which is in a state where a gas ban is on the books (to be enforced in 2026). 

However, we have seen success with heat pumps in states like Maine and even countries like Norway. We partially owe that to modern compressors, which run much faster nowadays than they did in the heat pumps of yesteryear. We can move more refrigerant and more heat. We’ve also been utilizing refrigerants that absorb more heat energy more efficiently. (Even the new A2L refrigerants are very similar to R-410A in terms of temperatures and pressures.)

You can learn more about cold-climate heat pumps in THIS podcast with Chad Gillespie, Dana Fischer, and Scott Libby. 

We have also seen more dual-fuel systems to make sure efficiency doesn’t come at the cost of comfort. These dual-fuel systems consist of a heat pump (not a straight-cool A/C system) and a furnace. The heat pump is the main heat source, and the furnace is a backup for when the heat pump may not be able to handle the heating load.

Energy Storage

To support net-zero carbon initiatives and the electrical grid, several green buildings have started utilizing energy banking during off-peak periods, which stores additional energy until it can be used when there is a higher demand for energy. 

I won’t go into too much detail, but there are a few ways we can do this. One of these is through cold storage or ice banks, as explained in THIS podcast. Those are more common in commercial structures. It also stands to reason that we could use solar energy to support the grid or even buffer tanks.

Industry Events in Early 2024

As always, we have a few great trade events to look forward to at the beginning of each year. 

First, we have the AHR Expo in Chicago from Monday, January 22, through Wednesday, January 24. I will be moderating the HVACR State of the Industry Panel again on Tuesday, January 23. We’ll cover the hot-button topics of 2024, especially the ones mentioned in this tech tip. We’ll have returning panelists Talbot Gee (HARDI), Stephen Yurek (AHRI), and Dominick Guarino (NCI), as well as new panelists Ginger Scoggins (ASHRAE) and Greg Walker (ASHB). I’ll also have a presentation about heat pumps that anybody can understand on Monday, January 22, at 1 PM.

After that, we have the 5th Annual HVACR Training Symposium with a lineup of old favorites and some exciting new speakers. You can learn more about the symposium or buy a virtual ticket with unlimited access to the sessions at https://hvacrschool.com/Symposium24. 

We also have the National HVACR Education Conference by ESCO Institute (HVACR Excellence) from Monday, March 25 to Wednesday, March 27. You can learn more about that event and see the list of topics and speakers at https://hvacrschool.com/HVAC-Excellence-2024. 

I hope to see some of you at these events. They’re always a great time and a gold mine of knowledge; they’re well worth the time. In any case, I hope you all have a great new year, and may the R-410A prices stay manageable!