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U.S. heat pump shipments remained strong in the first half of 2026, according to a Building Decarbonization Coalition report based on industry data. The trend suggests the federal tax credit’s expiration has not yet produced a clear shipment downturn, but the full-year result and reasons for continued demand remain uncertain.
U.S. heat pump shipments remained strong in the first half of 2026, despite the federal tax credit for the equipment expiring at the end of 2025, according to a recent report from the Building Decarbonization Coalition. The nonprofit says shipments are on pace to match or exceed the technology’s best year, though a final annual total is not yet available.
The coalition’s report draws on shipment data from the Air-Conditioning, Heating, and Refrigeration Institute, a trade group that represents most of the U.S. market. The figures offer an early measure of sales activity after a major federal incentive ended, but they do not establish why shipments held up or how many purchases were directly affected by the policy change.
The federal 25C tax credit had reduced the cost of eligible heat pumps by as much as $2,000. It expired at the end of 2025, seven years earlier than the deadline set under the Biden administration, according to the source report. The credit’s removal formed part of a broader rollback of federal support for household clean-energy technologies.
Heat pumps can provide both heating and cooling, and can replace gas furnaces in some homes. The report’s early shipment picture indicates that demand has not collapsed following the credit’s end. It does not, however, provide a final 2026 result or settle whether shipments will remain at the same pace through the rest of the year.
Demand Without the Federal Credit
The shipment data matter because the federal credit lowered the upfront cost of a heat pump for households that claimed it. Its expiration raised the possibility that some consumers would delay installation or choose another heating system. Strong first-half shipments suggest that the policy change has not yet translated into an obvious market-wide decline in the available data.
That does not mean the credit had no effect. Shipment totals cannot show whether sales would have been higher if the incentive had continued, nor do they identify the decisions of individual households. The numbers are an early indicator of market activity, not a direct measurement of the tax credit’s impact.
The outcome matters to homeowners, contractors and policymakers weighing the cost of heating upgrades and the role of public incentives. If demand stays firm, it may indicate that factors beyond federal tax support—including local incentives, household economics and contractor capacity—are sustaining purchases. The report alone cannot determine the relative weight of those factors.
What May Be Sustaining Purchases
UC Berkeley business professor Lucas Davis has argued that the federal credit may not have been a decisive factor for many buyers. In a blog post cited by the source report, Davis said past research points to geography, climate and electricity prices as important influences on heat pump adoption. He suggested households may have bought systems without knowing about the credit, or learned of it only when filing their taxes.
Contractors have also told industry publication ACHR News that they were often the ones who introduced customers to the credit, rather than customers asking about it first. That account is consistent with the possibility that many buyers were motivated by other considerations, but it is not a nationwide survey of consumers and does not establish how common that pattern was.
Some households can still access state and utility incentives, while local governments continue to adopt measures encouraging a shift away from fossil-fuel heating, the source report says. It also notes that contractors have become more familiar with heat pump installations in recent years. These factors may help explain resilience, but the report does not quantify how much each contributed.
“I suspect most households adopted heat pumps without ever knowing anything about the credit, or didn’t learn about the tax credit until months later when filing their taxes.”
— Lucas Davis, University of California, Berkeley business professor
The Full-Year Picture Is Pending
The available report covers the first half of 2026; it does not give a final annual shipment count. The claim that 2026 could match or exceed the best year is a projection based on the pace so far, not a confirmed year-end outcome. Seasonal demand or other market changes could affect the final tally.
It is also unclear how the credit’s expiration affected purchases compared with what would have happened if it remained available. Shipment data measure equipment entering the market, not household awareness, completed installations, consumer costs or the reasons behind buying decisions. The source material does not provide a comparison that isolates the credit’s effect.
State and utility incentives remain available in some areas, but their reach and value vary. The report does not specify how many buyers used those programs or whether local policies and contractor familiarity account for the sustained shipments.
Watch for the 2026 Shipment Total
The next key milestone is the final 2026 shipment tally, which will show whether the strong first-half pace continued. The Building Decarbonization Coalition’s report says to watch for that final count, but the source material does not give a publication date for it.
Further data could clarify whether shipments matched or exceeded the market’s previous best year. Even then, shipment totals alone would not show how much of the result was caused by state or utility support, local rules, prices, climate or the loss of the federal credit. A clearer assessment of those effects would require evidence on installations, consumer choices and the alternatives buyers considered.
Key Questions
Did federal heat pump tax credits expire?
Yes. The federal 25C credit, which could reduce the cost of a heat pump by as much as $2,000, expired at the end of 2025, according to the source report.
Did heat pump shipments fall after the credit ended?
The available report says shipments remained strong in the first half of 2026. It does not provide a final full-year count or establish how shipments would have changed if the credit had continued.
Why might demand have held up?
Possible factors cited in the report include climate, geography, electricity prices, state and utility incentives, local policies and contractors’ growing familiarity with heat pumps. Their individual contributions are not quantified.
When will the full 2026 result be known?
The source report says to watch for the final shipment tally, but it does not specify when that figure will be published.
Source: rss
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