New Efficiency Standards Will Increase HVAC Replacement Costs for Landlords in 2023

What is SEER?

SEER stands for Seasonal Energy Efficiency Ratio, and it measures the air conditioning unit’s efficiency over the course of an entire cooling season through a fluctuating range of temperatures and humidity levels. The higher the SEER rating, the more efficient the unit is. The DoE periodically evaluates current HVAC technology as it pertains to energy usage, and the latest review will require new systems that will have higher purchase and installation costs than those currently available.

How Are The Standards Increasing in 2023?

The HVAC efficiency rating of 14 SEER is currently the standard for the southeastern region, which includes Delaware, Maryland, and Virginia; however, on January 1, 2023, the federal minimum SEER2 rating will increase to 15 SEER. The new standards apply to residential AC units and heat pumps manufactured after December 31, 2022, so existing appliances aren’t covered. However, consumers and contractors looking to install a new HVAC equipment next year will have to abide by the new minimum SEER2 ratings.

What Should I Do To Avoid Over Paying For HVAC Replacement in 2023?

Within our region, sell through of existing systems—for HVAC units manufactured before 2023—will not be allowed because compliance is determined by installation date. As was the case for earlier policy changes, violators can expect fines and other sanctions for installation of improperly rated (14 SEER or less) equipment.

Landlords and property managers with HVAC systems that are nearing the end of their service lives should consider replacement as soon as possible to avoid the inevitable price hike at the end of this year.