HVAC Market Changes in 2020
HVAC Market Changes in 2020
As the New Year gets under way, 2020 promises to open a decade of both challenge and hopeful expectation.
Both market forces and regulations are changing, a situation which often brings with it a fear of business slow downs and disruption. Yet as the industry adjusts to new efficiency requirements and the phase out of old refrigerants, there is still reason to anticipate continued growth.
The HVAC market is projected to surpass over $98 Billion in North America this year. A compound annual growth rate of nearly 5% is expected over the next 5 years, buoyed by continuing advances in the construction sector.
HCFC Refrigerants are Phased Out
Part of a two decades long phase out of ozone depleting, greenhouse gas refrigerants, January 1, 2020 saw the phase out of the hydrochlorofluorocarbon R-123, which can no longer be used in new HVAC equipment. Its use will continue in servicing older equipment until 2030.
R-22, another HCFC that has long been on a gradual phase-out timeline, can no longer be produced in the US or imported for use in any equipment as of 2020. Of course, many commercial systems continue to use R-22. They are now officially obsolete, and when next they require maintenance, these systems must be replaced instead.
When it comes to understanding changes in regulations and efficiency ratings for commercial HVAC, Emerson recently produced a handy reference on the 10 things You Need to Know about Commercial HVAC Regulations.
Tax Codes Incentivize Commercial HVAC
In the 2020 Doge Construction Outlook, prepared by Dodge Data and Analytics, it is projected that the total U.S. Construction market may slip as much as 4% from 2019 levels. How then, can HVAC continue its years’ long pattern of growth?
As mentioned in the previous section, one force will be the replacement of obsolete HVAC systems that can no longer be maintained now that their obsolete refrigerants have been banned.
Another positive force is the Internal Revenue Code, Section 179. It allows businesses to deduct up to $1 million of the cost of an HVAC purchase in the first year, up to a maximum purchase price of $2.5 million.
These tax benefits are slated to phase out in 2023, making the next few years the perfect time for commercial customers to invest in new, more energy efficient systems.
Advancing Technologies
Technology advances are happening on two fronts. The first is in introducing new green technologies and energy efficient control systems. These include new zoning systems, smart thermostats & sensors, and both dual-fuel and air-source heat pumps.
Advances in geothermal, solar, and Desiccant Enhanced Evaporative Systems (DeVAP) continue to make measured progress.
But as important is a second front of high-tech improvements. These advances are often made behind the scenes, in areas of fabrication and logistics. From shop drawings for ductwork to materials estimating, and from building information management to duct fabrication, new levels of precision and error reduction have both reduced costs and delivered increased energy efficiency and comfort.
Duct Fabrication is TCG’s Business
At TCG Duct, we can provide all or part of your HVAC fabrication needs. Your project is priced from a Material List or via a take off from prints you provide. Our team of engineers, fabricators and technicians are trained on the latest equipment and methods that enable us to meet your exacting standards.
Let TCG Duct be your partner in the HVAC Industry as an experienced, high-quality manufacturer of HVAC duct of all types. Our goal is to partner with our customers in ways that make the entire workflow from order to installation a seamless exercise in time and cost savings.
The Cincinnatus Group supplies traditional Rectangular Ductwork as well as Spiral Ductwork, Double Wall Spiral Duct , PCD Ductwork, and Industrial Welded Ductwork.
Why Choose The Cincinnatus Group?
As your partner, The Cincinnatus Group helps your organization stand out in its marketplace, win more bids, save substantial costs, and build the knowledge and skills your team needs to continually meet new challenges effectively and profitably.
Our strong work ethic, accountability, and pursuit of excellence sets us apart from other contracted sales and marketing services, and our unique expertise and proprietary ductwork systems make us unique amongst our competitors.
At The Cincinnatus Group, our fabrication partners gain access to our unique experience and expertise in contracted sales and marketing.
Our assets help you navigate the ever-changing markets of the 21st century.
To learn more about our Contracted Sales services or other services we provide: Contracted Estimating and Take Offs, CAD/BIM/Coordination Drawings, and Project Management Assistance, please call The Cincinnatus Group at 878-295-8009, or visit our Contact Us page today. We are looking forward to the opportunity to help grow your business.
