With initial funding from the Real Estate Foundation of BC and BullItt Foundation, CEA is supporting municipal partners in Metro Vancouver, Lower Mainland and Sea to Sky Corridor in the development of a new business model to transform the electric air source heat pump market.
The province of British Columbia has set targets to reduce greenhouse gas (GHG) emissions 80% by 2050 below 2007 levels. Within British Columbia the residential sector is responsible for 6% of emissions. For the Province of BC to meeting is climate goals, homes must be decarbonized. The project intends to detail the design for a business model and corresponding program that will transform the market and accelerate electric air source heat pump (ASHP) adoption in single-family detached/semi-detached homes as existing fossil-fueled space heating assets reach end-of-life. If annual adoption rates mirror heating system replacement rates (6%), participating municipalities will exceed their building-related GHG emission targets by 2030.
Heat Pump Retrofit Opportunity
CEA has completed initial research into options for a successful business model, “Business Model Innovation to Support Air Source Heat Pump Retrofits in Metro Vancouver” (November 2019). The public report recommends fundamental elements of a new industry business model that can transform the electric air source heat pump (ASHP) market and deliver the number of ASHP retrofits needed for Metro Vancouver to reach its single-family home GHG emission reduction targets. Business model recommendations were based on a literature review of market transformation strategies and six existing heat pump business models, as well as dozens of interviews with government, industry and civil society organizations. The analysis included elements of the business model innovation process where different ideas were aggregated and evaluated to enhance the value proposition of electric ASHP to subject market.
A Path Forward
A ‘One Stop Shop’ or concierge service model is proposed to pilot. Currently, households interested in installing an electric air source heat pump (ASHP) system are largely left on their own to identify a qualified installer, ensure a quality unit and system design, locate available incentives, and arrange financing. In support of this concept, CEA published “Business Model Innovation to Support Air Source Heat Pump Retrofits in Metro Vancouver: What We’ve Learned” (August 2020). The report expands on the learnings in the original publication and answers several outstanding questions that will be used to inform the design of the business model and programming for pilot implementation in the project partner’s communities.
Need more info?
Currently, the project is entering detailed design. For more information about the Pumping Up Savings in Heat Program, please contact Danielle Wiess, Sr. Community Energy Manager (firstname.lastname@example.org)