Heat pumps can save households money. But the super-efficient, electric HVAC appliances are almost always more expensive to install up-front than gas- or oil-fired options.
Jetson, a Vancouver-based heat-pump startup, thinks it can change that — with a combination of new software, hardware, and a direct-to-consumer approach.
“We are typically anywhere from 30% to 50% below competitive quotes,” said cofounder and CEO Stephen Lake.
The company’s name, which may resonate with certain cartoon-watchers, harkens back to an era when people believed that “technology would enable this exciting, better future for us all,” Lake said.
His roughly 75-person startup, which Lake would only divulge has “raised a bit of money,” launched sales last October to try and deliver on that promise. So far, it’s installed heat pumps — which can both warm and cool spaces — in nearly 1,000 homes in Colorado, Massachusetts, and British Columbia, Canada, and it plans to expand into New York in a few weeks, he said.
Today, Jetson is announcing a move it says will further cut costs: It’s rolling out its very own heat pump, the Jetson Air. The startup has partnered with an undisclosed manufacturer to make the appliance.
Whole-home ducted heat pump projects in the areas where the startup currently operates typically have a price tag of $25,000 to $30,000, Lake said, citing data from bids that customers routinely share with Jetson. Those prices are also about the norm nationwide, according to electrification nonprofit Rewiring America — and are significantly higher than the cost of a new gas furnace ($8,000 to $10,000) plus air conditioner ($3,000 to $5,000), Lake said.
Jetson says its average heat-pump installation cost is way less than the national average: just $15,000.
Many markets also offer thousands of dollars in heat-pump rebates, which the startup deducts from what customers pay out of pocket. In these spots, Jetson can offer heat pumps in some cases for as little as $5,000, Lake said. At that point, it’s a financial no-brainer to choose the electric equipment over a gas furnace.
Bringing down the up-front costs of heat pump adoption is crucial, especially in the U.S., where the federal government is pulling back incentives for the HVAC tech. More than 80 million homes across the U.S. and Canada burn fossil fuels for heat, according to government data. These furnaces and boilers rack up around 3 to 6 metric tons of carbon emissions per household annually, Lake said, and heat pumps are the way to cut that pollution. Swapping a fossil-fueled heater out for a heat pump slashes CO2 about as much as trading in a gas car for an EV.
Jetson is taking a fresh approach to deliver its low heat-pump prices: vertical integration.
Traditionally, equipment manufacturers sell heat pumps to brands, which sell them to distributors, who sell them to HVAC installers, who sell them, finally, to homeowners, Lake explained.
“At each stage, there’s a markup,” said Brett Webster, a principal on RMI’s carbon-free buildings team. “There’s good reason to think that a vertically integrated company could reduce costs.”
Jetson cuts out the middlemen. It buys the heat pumps, stores them in its own warehouses, and has its own in-house installers ride out in the company’s electric vans to put the appliances in homes, Lake said.
Using custom software, Jetson also cuts costs by scoping heat pump projects virtually rather than sending someone out to each would-be customer. Last year, Jetson acquired whole-home decarbonization startup Helio Home and built upon its thermal modeling software that can accurately size heat pump systems remotely. In most cases, the first time an installer comes to an abode is to put in the heat pump. The company additionally uses proprietary software to process rebates.
Jetson’s tech-forward approach flows from Lake’s background. The Canadian entrepreneur previously built a smart-glasses startup called North that Google acquired for an undisclosed amount in 2020. With the climate crisis pressing and heat pumps an undersung solution, Lake and some of his colleagues from North pivoted to HVAC, he said.
Others are also developing software to improve the heat-pump customer experience. Manufacturing startup Quilt uses over-the-air updates to improve its minisplit heat pumps over time. And home-electrification startups, such as Zero Homes, have created software to reduce the cost of heat pump projects.
In the view of RMI’s Webster, Jetson’s vertically integrated approach is “taking the next step.”
Jetson installed a heat pump for Matt Machado, who works as an expert on surface water and groundwater rights at Colorado law firm Lyons Gaddis, for a cost of about $7,000 — a third of what the eight or nine other contractors he got bids from offered. He’ll get another $2,000 off when he claims the federal Energy-Efficient Home Improvement Credit (25C) at tax time. Jetson “made it easy,” Machado told Canary Media. On pricing, “they’re very transparent.”
Jetson’s low cost was thanks in part to the company’s up-front application of state and local rebates, which tallied roughly $6,000, Machado said. Other contractors didn’t make these reductions, which would’ve left him to absorb the cost and file for the rebates on his own.
With the launch of its heat pump, Jetson aims to provide a product that delivers the customer experience of a Tesla or Rivian electric vehicle, Lake said.
The Jetson Air heat pump is “comparable to the best models,” rated to work down to minus 22 degrees Fahrenheit, he added. Brands such as Bosch, Carrier, Lennox, and Mitsubishi already make popular options for cold-climate markets.
What sets Jetson’s appliance apart, Lake said, are its built-in software, sensors, and controls. Homeowners can use these features to schedule their heat pumps to run at times of the day when the grid isn’t strained and power is cheaper. The tech also lets Jetson monitor a system’s performance and reach out if something needs to be fixed.
“What are the amperages being drawn? Is your air filter getting dirty? Are there any error codes coming up? Is anything not running 100%? We can tell all that remotely,” he said. No other heat pump on the market today is capable of that, he noted.
Ultimately, Lake said that these improvements in functionality compound into more savings for the customer.
HVAC “is this very unsexy category, which I love,” Lake said. “So many things we’re doing — applying software to make [products] more efficient and designing better systems — [are] improvements that in other industries have happened a long time ago.” But they’re “completely novel in this HVAC world.”
