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BusinessCoronavirus

Homeowners snapping up heat pumps as COVID focuses spending on homes   

PSEG Long Island is on track to see more than 4,500 heating and cooling systems installed in homes this year, well above a targeted 3,500 systems. Credit: Barry Sloan

A new generation of heating and cooling systems, which work without fossil fuels, are being snapped up in an unexpected 2020 uptick despite economic woes tied to COVID-19.

PSEG Long Island, which offers rebates on the systems, said it is on track to see 4,500 of the systems installed in the region this year, well above a targeted 3,000 systems. That's a 50% increase from last year, when 2,858 systems were installed. By September’s end, some 3,900 had already been installed.

Heat pumps use ambient air to heat and cool homes, drawing hot air out in summer and cool air out in winter. They operate as central air-conditioning systems in summer, and the reverse in winter, all without using traditional fuels like oil or natural gas (aside from fuels used by LIPA to make the electricity).

Mike Voltz, director of renewable energy and efficiency programs for PSEG, said customers who have remained largely landlocked during the pandemic are foregoing expensive vacations and "putting the money into their homes," likely driving the heat-pump uptick.

"We had originally thought that with COVID’s impact on jobs we might struggle with this," Voltz said of the adoption of heat pumps. "But in some ways the opposite happened."

The systems, which can cost upward of $7,000 to $13,000, depending on whether homes need to have new ducts installed, are eligible for rebates that can reduce customers’ costs by $2,000 to $3,000 or more depending on the size of the system. (PSEG offers rebates of $1,000 per ton of systems that typically run three tons for the average home.)

Most of the activity and promotion for heat pumps is coming from the roughly 100 local installers across Long Island who are authorized by PSEG to sell systems with its rebate. (They receive hundreds of dollars in additional incentives from PSEG for doing so, Voltz said.)

One class of customer that can be the easiest sell for heat pumps is those who are considering having central air-conditioning installed or replaced. For many, the additional cost of the heating side of the equation can be offset by the rebate.

"It’s not much more to install a heat pump with central air, and you get the advantage" of an efficient heating system, Voltz said.

Heat pumps are an average 15% to 20% more efficient than traditional heating systems, PSEG says, and a new generation of the systems can provide heat even when the temperatures outside hit zero degrees.

A former generation of heat pumps that were installed over the past two decades had mixed acceptance in the Northeast. Voltz said that’s because some installed systems that were meant for warmer climates. Customers needed to resort to backup heat, including electric heaters that can use lots more energy than standard gas or oil-based heating systems.

Bruce Gordon, who recently moved to Florida but had an older heat pump installed on his former Jericho home, said the experience left him wary of the systems.

His old unit required that he go outside to remove ice and snow in the coldest weather, and he felt the difference when the system had increasing difficulty producing heat when temperatures got particularly colder. "Why would you want a heating system that gets less efficient as the temperatures drop when that's when you need the heat the most?"

Newer units "are specifically designed for climates that are colder than Long Island," said Jay Best, chief executive of Green Team LI, a green-energy audit and services firm in Holbrook, adding that newer units are considerably more efficient. But he does recommend customers do their homework before installing systems, including prepping their homes accordingly.

Heat and cool-air loss caused by drafty homes can be exacerbated with heat-pump systems, Best said. "That's why we always recommend getting an energy audit and improving the 'shell' of the house so that it does a better job of retaining the heat in the winter and the cold in the summer," he said. Duct work also must be properly designed and insulated, and new systems are installed well off the ground or to a wall to prevent snow and ice issues.

PSEG is also offering separate heat-pump systems for hot-water heaters for homes. Of the 3,900 systems installed thus far, 168 are hot-water heating systems, he said.

Customers who install a heat pump also get discounted electricity for the heating season — Oct. 1 through May 31 — with a reduction of 15% over conventional rates, Voltz said.

The free audits recommended and provided by PSEG and contractors can identify draft-prone homes that should be better insulated and weather sealed to make the systems more efficient.

Heat-pump systems work well with solar systems, reducing customers overall carbon footprint, while maximizing any excess electricity that customers would otherwise bank through the utility’s net metering system, Voltz said.

Certain low- to moderate income customers can qualify for an additional 50% boost on rebate amounts, he added.

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Cutting the cost of heat

Ratepayer-funded rebates for heat pumps amount to $1,000 per ton for systems, which average between 3 and 4 tons, so the rebates can cut $3,000 to $4,000 or more from the basic cost of a system.

Heat pump systems can also reduce overall energy use in homes that are properly sealed to hold in heat (and cool air in the summer).

PSEG offers special winter heating rates for the systems that further discount the systems

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