PHCC-NA and higher efficiency

The market for higher efficiency water heaters has grown rapidly over the past five years. In 2009, water heaters became eligible for the ENERGY STAR label, introducing a new way for plumbing contractors and consumers alike to recognize higher efficiency units. Following the release of the water heater market profile detailing the state of the market last fall, Frank Maddalon, president of the PHCC-National Association, provides valuable insight into the impact of the ENERGY STAR program and the association’s efforts to promote water heating efficiency.

Coalition for ENERGY STAR Water Heaters: Two years ago, higher efficiency water heaters gained the ENERGY STAR label. What effect have you seen this have on the industry?

Maddalon: The ENERGY STAR program has definitely had a positive impact on the industry. There is a great deal of consumer interest in the ENERGY STAR label, and the addition of the water heater category has helped increase awareness of the benefits of higher efficiency water heating products. Contractors now have many higher efficiency options to offer their homeowners. This allows them not only to provide more energy-efficient options but also to offer custom solutions, regardless of the particular application.

Coalition: What is PHCC’s involvement in encouraging higher efficiency water heating in the residential sphere?

Maddalon: PHCC works with several industry partners to communicate to members the benefits of using higher efficiency water heaters. For example, seminars on the general topic are offered at our annual CONNECT and Product & Technology Showcase event. Partnering with industry manufacturers, PHCC’s quality service contractors unit has provided webinars and seminars as well.

Our energy efficiency and water conservation committee is very active in promoting higher efficiency appliances to members. Informed with the benefits of higher efficiency products, PHCC members have increased the market exposure to consumers, leading to high quality installations. Not only can educated members offer an expanded range of products to their customers but they can also be assured that they will ultimately have a satisfied customer base likely to suggest higher energy-efficiency options to others. This availability of information allows PHCC members to take a leadership role in the adoption of these new higher efficiency products.

In addition, our government relations department is continuing a push on Capitol Hill to restore energy efficiency tax credits to their original levels. Related to that, we’re educating our members of the changes to the Residential Energy Tax Credit under IRC 25C that was approved in late 2010. We’re also informing them of the changes to the minimum equipment energy rating levels required for this energy tax credit. Through our partnership with WaterSense, we’re actively promoting legislative language that not only supports higher efficiency related to water products but also calls for installation by a professional contractor.

Coalition: What higher efficiency water heater resources do you have available to members?

Maddalon: We recently expanded our staff to include a vice president of technical services, who will be a valuable resource for members interested in obtaining information about higher efficiency equipment and trends. We also have a strong presence with the federal regulatory agencies and can tap into those resources. Our energy efficiency and water conservation committee has subject matter experts from whom it can draw specific expertise. We are continually updating our website (www.phccweb.org) with technical information and links. And, as always, our industry partners are willing to help inform and educate our membership.

Coalition: What is the biggest challenge facing the association and the industry this year, and what effect does that have on the promotion of higher efficiency water heaters?

Maddalon: The changed economy continues to be the biggest challenge for the association and the industry. Although there are many signs of improvement, everyone is still uncertain of what the future holds. The drawdown in the economy has kept contractors from selling up on many products. Although pricing continues to be a challenge, it’s increasingly important to remind customers of the investment value of a higher efficiency water heater. We encourage members to educate their customers on the benefits of higher efficiency, such as energy and water savings and the fact that many ENERGY STAR models may pay for themselves over the course of several years with the energy they save.

Coalition: With the current state of the economy, in what markets are you seeing growth opportunity for higher efficiency?

Maddalon: Right sizing ENERGY STAR water heaters is a key component of selling these units. Some higher efficiency water heaters may require additional installation costs in retrofit applications. Because these variances in the installation process are easier to overcome when building a new home, new construction introduces an open market and greater opportunity for selling in this economy.

To be successful in selling higher efficiency models, we encourage our members to use PHCC resources to continue to educate themselves about these units and to remind customers of their benefits. Members need to maintain a positive attitude, rely on proven business strategies to get through this challenging period and plan for the future. Now, more than ever, it is important for contractors to tap into available resources, to build relationships, to explore best practices with other contractors and to learn innovative strategies.