How HVAC Contractors Profit from 'Electrification'

Governments and companies around the world are committed to cutting emissions of greenhouse gases and reach carbon neutrality by 2050. This will require transitioning away from fossil fuels such as coal, oil and gas, and moving toward solar, wind, hydro, and geothermal.

In a perfect world, this technology will make electricity more cost-effective than the use of fossil fuels.

Electrification makes homes more energy efficient, thereby reducing electric bills and cutting down on pollution.

How We Profit from Electrification

More and more people will be installing heat pumps in their homes, which are more expensive the straight cool systems, and are a key component of electrification. The International Energy Agency estimates that heat pumps currently provide only 5% of space and water heating requirements globally, but have the potential to provide over 90%. They also flatten the electric demand curve by eliminating the peak electric supply requirements required by air conditioning, which will be necessary once everyone in the country needs to charge their electric cars all at once.

Many HVAC companies have begun selling and installing solar energy. That's a big ticket item, and I know one HVAC salesman that says it's easier to sell than replacement systems.

Smart Homes

Smart homes with integrated appliances, smart thermostats, and LED bulbs make homes more efficient, safe, and comfortable. When you walk into any of the big box retailers, there's a home automation aisle. If they're going to give it that much shelf space, there's got to be money in it.

People want control over every aspect of their lives, and they want to be able to do it through their smart phones. Home automation has come into its own, and the growth opportunity for HVAC contractors is boundless.

Home automation is an additional product, and consequently, a profit center, in itself.

Home automation is an additional product, and consequently, a profit center, in itself.

These are all controlled with a single app on a smart phone or through a website on a computer. They're easy for to install and easy for his customers to use.

You don't need to spend  lot of money on marketing. The entire marketing program can be based on service technicians and salespeople starting the conversation. Technicians are trained to say, "Mrs. Jones, would you like to be able to control your thermostat, your lights, and your door locks from your smart phone?"

Once someone owns a smart thermostat, you sell them:

• Water valves
• Cameras
• Garage door openers
• Fan controllers
• Light switches
• Light bulbs
• Door locks
• Smoke detectors
• Glass-break detectors
• Water sensors
• Doorbell sensors.

Part-time residents like the fact that, if they're out-of-town, they get an alert on their smart phone if the temperature or the humidity in their home rises.

Include a smart thermostat with every replacement installation. Have s brochure that shows customers what it can do for them. One contractor I know says that, once a customer agrees to having the thermostat installed, they'll look through the brochure and order additional home automation devices.

Once a customer starts using the system and sees how easy it is to use, they start thinking about where they want things like cameras, and how they can use the system to do things like:

•  Monitor when their children are home (and whether or not they're alone)
• Turn their television on so it looks like they're home
• Turn on their coffee maker
• Watch their pets.

Make electrification work for you by selling more heat pumps, consider getting into solar, and  add home automation to your product line. You'll make more money with new profit centers, set yourself apart from the competition, and tie customers to your business.

CHARLIE GREER was voted "Favorite Industry Sales Trainer," "HVAC Consultant of the Year," and is a member of the Contracting Business Hall of Fame. For info on Charlie's products or services, call 1-800-963-HVAC (4822) or go to www.hvacprofitboosters.com. Email you questions or comments to [email protected].