US Apartment Buildings Shift Toward Heat Pumps in 2025

First year of widespread heat pump adoption in US housing displaces fossil fuels from buildings, cutting energy costs for renters

US Census Bureau data shows 53% of new apartment complexes and 48% of new houses constructed in 2025 included heat pumps—up from 46% and 45% in 2024. Regional adoption varies sharply: 96% of new South apartment units used electric heating versus 52% in the Northeast. This shift follows technology improvements and heightened AC demand during heat waves, as noted by Sightline Institute. The federal tax credit under the 2022 Inflation Reduction Act—providing up to $5,000 per unit—expired after Trump and Republicans terminated it, though New Mexico developer John Moscato estimates skipping gas lines saves $3,000 per lot, projecting $13.5 million in savings for 4,500 lots.

The trend reflects a growing move toward electric heating systems, with 78% of new apartment units and 56% of new houses using electric heating in 2025. California, Colorado, and Washington have adopted standards requiring full-electric construction, accelerating this transition. For renters—whose energy costs are often fixed by landlords—heat pumps directly displace fossil fuels in housing, reducing heating expenses without new infrastructure.

This matters because it scales energy affordability for low-income renters by cutting fossil fuel dependence in the largest housing segment. However, the 2025 data represents the first year of nationwide adoption, regional heating patterns remain uneven, and savings figures apply only to Moscato’s specific New Mexico project. What follows will depend on whether states maintain electric standards and whether the tax credit’s expiration creates barriers to scaling beyond pilot developments.

Source: Canary Media