Despite the expiration of a key federal tax credit at the start of 2026, heat pump sales in the US have continued to climb, surpassing natural-gas furnace sales by 32% in early 2026 and signaling a durable shift in home heating preferences.
- Heat pump sales in US doubled over past 15 years
- Outpaced natural gas furnaces by 32% in Q1 2026
- Sales continue rising despite end of $2,000 tax credits
What happened
Heat pumps, electrical appliances that transfer heat using refrigerants for high efficiency, have gained significant traction in the US heating market. Over the past 15 years, their sales have doubled, and in the first quarter of 2026, shipments exceeded natural gas furnace sales by 32%. Notably, this growth has persisted even after the federal tax credit of up to $2,000 for heat pump installation, which was in place from 2023 to 2025, ended on January 1, 2026.
Data from the Air Conditioning, Heating, and Refrigeration Institute shows that shipments were steady from December to January and have gradually increased since, following seasonal trends but with stronger momentum this year. Unlike recent experiences with electric vehicle incentives that led to a post-credit sales slump, heat pumps have not seen a drop-off, indicating robust consumer demand beyond financial incentives.
Why it matters
Heat pumps represent a vital technology in efforts to reduce carbon emissions by replacing fossil fuel-based heating with more efficient electric systems. Because they do not burn fuel directly and use electricity more efficiently than traditional gas or oil furnaces, their adoption is critical for decarbonizing buildings, a significant contributor to overall emissions. Continued sales growth signals increasing consumer confidence and acknowledgment of heat pumps as a practical, beneficial option for home heating and cooling.
The sustained demand, independent of tax credits, suggests that market forces and the inherent advantages of heat pumps — including lower operating costs and dual heating/cooling functionality — have strengthened their position. This resilience improves prospects for further adoption, which is essential as the US and other countries work to meet climate goals. The trend also highlights the importance of reliable, affordable electric heating alternatives in mitigating the energy sector’s environmental impact.
What to watch next
Stakeholders should monitor how the heat pump market evolves without federal incentives and whether state or local programs step in to support adoption. The higher upfront cost of heat pumps compared to gas furnaces remains a barrier for some consumers, so policy developments or technological advances that reduce purchase and installation expenses will be key factors influencing future growth.
Additionally, tracking market competition and supply chain dynamics as demand increases will be important. Observers should also watch how heat pump sales perform through different seasons in 2026 and beyond, as well as how these trends interact with the broader energy transition, including developments in renewable electricity supply that enhance the environmental benefits of electrified heating.