Choosing heat pumps over air conditioners would reduce Canadian emissions and cut energy costs by billions, research finds

Policies encouraging a shift towards heat pumps will benefit HVAC manufacturers, distributors, and contractors, along with Canadian households

A new report from the Building Decarbonization Alliance, Canadian Climate Institute, Efficiency Canada, and Greenhouse Institute shows that Canadians are missing a massive opportunity to reduce emissions from home heating and save billions on their energy bills. 

The need for cooling is becoming a matter of life and death in Canada. The 2021 heat dome in BC is the single deadliest weather event in Canadian history, and with temperatures reaching over 40 degrees in BC this month, it’s no surprise that nearly 7,000 Canadians are adding a central air conditioning system to their home every week. 

In doing so, they are missing a tremendous opportunity to reduce their greenhouse gas emissions and save on their energy bills while improving their quality of life. The Cool Way to Heat Homes finds those same consumers would save a collective $10.4 billion in energy bills and reduce emissions from home heating by 19.6 million tonnes by 2035 if they installed heat pumps instead, all while obtaining the same cooling benefits. 

Air conditioners and heat pumps work in mostly the same way: they cool spaces by moving heat from one place to another. The difference is, air conditioners only move heat in one direction, from indoors to outdoors, whereas heat pumps are designed to switch directions and bring heat inside, making them a solution for both heating in the colder winter months and cooling as temperatures heat up in summer. And because they are moving heat instead of creating it, they are incredibly efficient at heating homes—resulting in an annual energy savings of $349 for the average Canadian home by 2030, and substantially more for households using expensive energy sources like electric resistance or oil.  

Since air conditioners are typically only replaced when they fail, every week 7,000 Canadian homes are locked out of the benefits of heat pumps for decades to come. The Cool Way to Heat Homes explores a range of policy options for all levels of government to turn this challenge into a huge opportunity, including smart regulations, updated building codes, and targeted incentives. These actions would benefit HVAC manufacturers, distributors, and contractors while helping Canadians adapt to increasingly extreme temperatures. 

The difference between an air conditioner and a heat pump is minimal, but the benefits of switching are massive. By encouraging a market shift to heat pumps, policymakers can unlock billions of dollars in net benefits, all while making major progress towards a net-zero economy.

"As households across the country look for ways to adapt to increasingly dangerous summer heat, this report shows how we can turn a serious challenge into a tremendous opportunity. Encouraging the installation of heat pumps over air conditioners is a no-regrets action that we can take today that will save Canadians billions of dollars in energy costs while lowering our greenhouse gas emissions by millions of tonnes."

Bryan Flannigan, Executive Director, Building Decarbonization Alliance

"Heat pumps provide cost-effective cooling for people living in Canada, as this analysis shows. As summers get longer and hotter across the country, having access to cooling is becoming essential and can be life-saving. Widespread adoption of heat pumps can help households adapt to the effects of climate change without increasing emissions."

Sarah Miller, Research Lead, Adaptation, Canadian Climate Institute

"This report adds to a growing body of research on the integral part heat pumps play in Canada’s net-zero emissions path. Increased heat pump adoption can save Canadians billions of dollars collectively while reducing home heating emissions by millions of tonnes. To unlock these savings, the federal government must increase incentives and require all new air conditioner sales to be heat pumps."

Brendan Haley, Policy Director, Efficiency Canada

“Too many Canadians are being saddled with one-way central air conditioners that sit idle half the year. Two-way heat pumps can both keep families cool in summer and help heat homes in winter. Installing heat pumps instead of central ACs will improve comfort, save money, and cut bills. It’s a win-win-win for Canadian families.”

Alexander Gard-Murray, Director, Greenhouse Institute


Peter Hemminger
Acting Director of Communications and Knowledge Mobilization
Transition Accelerator
(403) 710-5119 


About the Building Decarbonization Alliance 

An initiative of the Transition Accelerator, the Building Decarbonization Alliance is a cross-sector coalition that works to inspire and inform industry and government leadership, accelerate market transformation, and get the building sector on track to meet its emissions reduction goals. We convene conversations, conduct original research, and identify structural barriers to electrification— and work with our partners to overcome them. 

Join us on October 16 and 17 for the 2023 National Building Decarbonization Forum in Ottawa.

About the Canadian Climate Institute 

The Canadian Climate Institute is Canada’s leading climate change policy research organization, producing the analysis and evidence-based recommendations that are needed to advance climate resilience, chart net zero pathways, and drive long-term prosperity. The strength of our work is rooted in our independence, in the diversity and depth of our staff, board and advisors in fields from climate mitigation to adaptation and clean growth, and in the breadth of the stakeholders and rights holders we engage through our research. 

About Efficiency Canada 

Efficiency Canada is the national voice for an energy-efficient economy. We envision a future where Canada uses energy efficiency to its fullest potential. This means maximizing the benefits of energy efficiency resulting in a sustainable environment, a productive economy, and a just and equitable society. Efficiency Canada is housed at Carleton University’s Sustainable Energy Research Centre, which is located on the traditional unceded territories of the Algonquin nation. 

About Greenhouse Institute 

Greenhouse is an independent research institute dedicated to finding and fighting for innovative solutions to the climate crisis. We combine statistical analysis, computer modelling, and community engagement to develop pragmatic policies that reduce emissions while increasing prosperity. 

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