OBBBA and the Next Chapter of Heat Pump Commercialization
The passage of the One Big Beautiful Bill Act (OBBBA) this summer initially raised concerns in the building community by repealing popular federal tax credits such as Sections 25C and 45L. However, instead of slowing heat pump adoption, the law is accelerating innovation toward retrofit-friendly, cost-effective systems. Homeowners are increasingly prioritizing affordability and minimal installation disruption, driving demand for products that fit seamlessly into existing homes. Companies like Midea are meeting this shift with technologies like the EVOX G3 air handler and Packaged Window Heat Pump, designed to replace traditional systems quickly and without costly electrical or structural upgrades—ideal for both single-family and multifamily retrofits.
Meanwhile, state and utility incentives continue to fill the federal gap, offering rebates up to $10,000 in markets such as New York and Oregon. Builders who understand these programs and use products meeting ENERGY STAR Most Efficient and CEE Advanced Tier standards stand to gain a competitive edge. Technical advancements, such as cold-climate performance down to -40°F, smart controls and compatibility with demand-response programs, make these systems more versatile than ever. Combined with OBBBA provisions supporting skilled trades and stable business income deductions, the act is shaping a new phase of opportunity. Builders who embrace retrofit-ready, efficient systems are positioned to lead the next wave of sustainable housing growth.
