Luise Cox is upgrading her 1960s bungalow in Mississauga, Ont., this week by tearing out and hauling away the old air conditioner and natural gas furnace. Instead, crews are replacing those units with a brand new heat pump (and some extra insulation in the attic, too).
“We needed to upgrade, and environmentally it’s better,” the 85-year old said. “We’re spending a lot on heating and cooling, so hopefully this will help.”
Heat pumps, which have been promoted for years, have failed to gain traction with the public. But that’s starting to change with rising temperatures, improved technology and government rebates, among the reasons why.
HVAC specialist Peter Messenger says they’ve gone from 10 per cent of his company’s installations to about half almost overnight.
“I’m surprised at how quickly the general public’s mindset has changed on heat pumps,” said Messenger, owner of A1 Air Conditioning and Heating in Oakville, Ont., west of Toronto. “I always knew it would happen, I just didn’t know it would happen this quickly.”
He said heat pumps accounted for about 10 per cent of his sales last year but now make up about 50 per cent.
Luise Cox and her husband chose to install a heat pump at their Mississauga home to reduce their environmental footprint and utility costs. (Spencer Gallichan-Lowe/CBC)
Sales are growing so quickly that Messenger said he wonders whether heat pumps could even wipe out the sales of new air conditioners in homes in a few years and put a significant dent in the number of natural gas furnaces.
A heat pump often looks like an air conditioner and can function the same way. They cool a home by absorbing the heat inside and releasing it outside. But unlike an air conditioner, they can reverse the process in winter — heating a cold house without the need of a burner like a furnace, by transferring heat from where it’s not needed to where it is: inside.
“We won’t sell air conditioners. Everything will be a heat pump” in a few years, Messenger said. “People may still keep their gas furnaces, but as time goes on, I think we’re going to see less and less gas meters on people’s homes.”
Peter Messenger, owner of A1 Air Conditioning and Heating, says government rebates are helping to reduce the cost of a heat pump, allowing people to install a much better, greener heating and cooling system for the same amount of money as a new furnace and air conditioner. (Spencer Gallichan-Lowe/CBC)
‘Perfect storm’
Heat pumps existed for decades, and more than 400,000 were installed in Canada in 2000, but� that number has doubled in the two decades since. However, a confluence of factors is driving a spike in sales this year.
The federal government’s $2.6-billion Canada Greener Homes Grant can help reduce the purchase price by $5,000, while other provincial, municipal and utility rebates in some parts of the country can help cut the installation cost further.
There is a growing familiarity with the technology, companies say, and a growing interest by homeowners to reduce their environmental footprint. Supply chain problems in recent years no longer exist.
“It’s just the perfect storm of the right factors that are driving some of this,” said Greg Donahue, product manager with Reliance Home Comfort, which operates in five provinces between Ontario and British Columbia.
This year, the company’s heat pump sales are up to seven times higher compared with 2022, he said.
“At the end of the day, if you are looking to get a new heating and cooling system in your home, you will get a better, more efficient heating and cooling system if you do a heat pump — and you’ll get it for the same or oftentimes lower cost to the homeowner,” Donahue said.
Reliance Home Comfort, which operates in five provinces between Ontario and British Columbia, says its heat pump sales are up to seven times higher this year compared with 2022. (Kyle Bakx/CBC)
Technology improving
The wildfire smoke and record heat waves in parts of the country are also motivating more people to buy a new cooling system, just as heat pump technology has improved to the point where it’s much more effective and efficient in a Canadian climate.
In Edmonton, increased demand for heat pumps is reducing the number of new air conditioners being installed, said Collin Goodyear, general manager of Romaniuk Heating and Air Conditioning.
But not everyone is ready to fully switch. Goodyear said people living in colder climates on the Prairies are often choosing to install heat pumps while keeping their furnaces as a backup for those extra frigid days.
“There still are those lower temperatures where the gas furnace is required, partly due to electrical costs. We still find it beneficial,” he said.
About 40,000 heat pumps have been installed or approved as part of the federal government’s Canada Greener Homes Grant, which launched in 2021.
Government subsidies are still essential to make heat pumps economical, although those in the industry say the price tag should continue to fall in the years ahead as manufacturers increase production. The price tag of a heat pump can vary. The average cost to purchase and install a system can range from about $6,000 to $14,000, depending on the size of the home.
Another challenge can be installing heat pumps at multi-family buildings, like an apartment complex, depending on the existing heating, cooling and ventilation system.
How heat pumps can cool a home in the summer and provide heat in the winter
Peter Messenger with A1 Air Conditioning and Heating and University of Calgary’s Sara Hastings-Simon explain how heat pumps work.
Climate goals
Heating and cooling buildings is responsible for about 13 per cent of Canada’s greenhouse gas emissions. The federal government’s goal is to cut those emissions by 37 per cent below 2005 levels by 2030, with an overall goal of reaching net zero by 2050.
The sharp rise in heat pump sales in Canada is mirrored by what’s happening in some other countries around the world, said Sara Hastings-Simon, an associate professor in the department of geoscience and the school of public policy at the University of Calgary.
“There’s a significant amount of infrastructure that has to change over to get to this net-zero target,” she said.
Sara Hastings-Simon of the University of Calgary says it will take time for a big shift in how buildings are heated and cooled, but each new heat pump is a step in reducing emissions. (Mike Symington/CBC)
It will take time for a big shift in how buildings are heated and cooled, but each new heat pump is a step in that direction and reducing emissions at the same time, Hastings-Simon said.
“It’s not just the silver bullet technology that comes about, but it’s actually that combination of the technology is ready, there’s a real strong case for a consumer and there’s some kind of government support — whether that’s incentives or policies that help to support that install,” she said.
Heat pumps are electric devices that can reduce a household’s environmental footprint if you’re replacing or reducing a heating unit that uses natural gas, propane or furnace oil, or a less efficient air conditioner.
The savings can add up fast. Replacing an oil furnace can save a homeowner up to $3,500 annually, according to a Natural Resources Canada study about the cost-effectiveness of heat pumps, depending on the region and type of home.
Netflix on Thursday reported that its subscriber growth slowed dramatically during the summer, a sign the huge gains from the video-streaming service’s crackdown on freeloading viewers is tapering off.
The 5.1 million subscribers that Netflix added during the July-September period represented a 42% decline from the total gained during the same time last year. Even so, the company’s revenue and profit rose at a faster pace than analysts had projected, according to FactSet Research.
Netflix ended September with 282.7 million worldwide subscribers — far more than any other streaming service.
The Los Gatos, California, company earned $2.36 billion, or $5.40 per share, a 41% increase from the same time last year. Revenue climbed 15% from a year ago to $9.82 billion. Netflix management predicted the company’s revenue will rise at the same 15% year-over-year pace during the October-December period, slightly than better than analysts have been expecting.
The strong financial performance in the past quarter coupled with the upbeat forecast eclipsed any worries about slowing subscriber growth. Netflix’s stock price surged nearly 4% in extended trading after the numbers came out, building upon a more than 40% increase in the company’s shares so far this year.
The past quarter’s subscriber gains were the lowest posted in any three-month period since the beginning of last year. That drop-off indicates Netflix is shifting to a new phase after reaping the benefits from a ban on the once-rampant practice of sharing account passwords that enabled an estimated 100 million people watch its popular service without paying for it.
The crackdown, triggered by a rare loss of subscribers coming out of the pandemic in 2022, helped Netflix add 57 million subscribers from June 2022 through this June — an average of more than 7 million per quarter, while many of its industry rivals have been struggling as households curbed their discretionary spending.
Netflix’s gains also were propelled by a low-priced version of its service that included commercials for the first time in its history. The company still is only getting a small fraction of its revenue from the 2-year-old advertising push, but Netflix is intensifying its focus on that segment of its business to help boost its profits.
In a letter to shareholder, Netflix reiterated previous cautionary notes about its expansion into advertising, though the low-priced option including commercials has become its fastest growing segment.
“We have much more work to do improving our offering for advertisers, which will be a priority over the next few years,” Netflix management wrote in the letter.
As part of its evolution, Netflix has been increasingly supplementing its lineup of scripted TV series and movies with live programming, such as a Labor Day spectacle featuring renowned glutton Joey Chestnut setting a world record for gorging on hot dogs in a showdown with his longtime nemesis Takeru Kobayashi.
Netflix will be trying to attract more viewer during the current quarter with a Nov. 15 fight pitting former heavyweight champion Mike Tyson against Jake Paul, a YouTube sensation turned boxer, and two National Football League games on Christmas Day.
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