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Commercial Building Industry Key to a Greener Future

Jan. 13, 2023
Addressing decarbonization challenges through hydronics.

When it comes to shrinking carbon footprint and maximizing return on investment, water-based systems provide the most efficient and sustainable solution. Based on tried-and-true principles with more than a century of success, hydronics is a demonstrated heating and cooling solution. With rising energy prices and new legislation escalating demand for more efficient buildings, modern hydronics presents a viable solution to reduce HVAC systems’ negative impact on the environment and promote renewable energy sources.

Carbon reduction in building design is critical to reducing energy consumption and ensuring a more sustainable future. In the United States, direct combustion of fossil fuels accounts for at least 34% of all energy used in commercial buildings.

Not only do HVAC systems account for nearly half of the energy used in commercial buildings, according to the US Environmental Protection Agency (EPA), they also fall in the top five sources of greenhouse gas emissions. 

These statistics are alarming enough to warrant drastic action by the commercial building industry, but there are other factors pushing the industry to switch to more environmentally friendly heating and cooling systems.

A wave of new building codes, policies and regulations are driving change and creating new challenges for the existing commercial building market. Yet, this also presents an opportunity for the commercial building industry to rethink how it does business by investing in smarter, better systems that reduce greenhouse gas emissions while achieving maximum ROI.

Legislation Spurring Change

Over the past decade, regulatory pressures have increased the speed at which efforts to achieve “net zero” carbon emissions are happening. Growing concern around climate change, along with the declining cost and improved performance of renewable energy technology, has prompted many states to create clean energy programs and policies.

According to the Clean Energy States Alliance (CESA), there are currently 21 states, along with the District of Columbia and Puerto Rico, that have adopted policies to move to either all-renewable or zero-emission electricity supplies.

Case in point, New York City and Boston, two of the largest commercial building markets in the US, have adopted stringent requirements for building emissions. New York’s Local Law 97 mandates cutting emissions 80% by 2050, with numerous benchmarks set along the way. The first benchmarks must meet new energy requirements by 2024, with more restrictive 40% reduction demands by 2030. Meanwhile, Boston’s Building Emissions Reduction and Disclosure Ordinance (BERDO) aims for net zero by 2050.1

HVAC at the Forefront

HVAC systems account for 39% of the energy used in commercial buildings in the United States. With that in mind, HVAC system selection is an important component in both new construction and retrofit projects to keep costs in line and realize energy-efficiency targets. When HVAC systems are designed with energy efficiency in mind, they use less electricity and produce fewer greenhouse gas emissions.

In an effort to propel the HVAC industry forward, the US Department of Energy (DOE) launched a new national initiative in 2021 to advance clean heating and cooling systems in buildings, making it easier to afford and install high performance heat pump solutions. As part of its E3 initiative, the DOE will be working closely with stakeholders nationwide over the next 10 years to transform the heating and cooling marketplace, making affordable, clean and efficient solutions easily available across the United States. That includes a strong emphasis on systems that can deploy effective hydronic heating and cooling technologies that already exist on the marketplace today, such as water source and geothermal heat pump systems, heat pump water heaters and the implementation of hydronic thermal storage strategies to further enhance savings potential.

Water – the Lifeblood of Buildings

Hydronic systems as a room comfort technology have been in use in some form for over 100 years. These installed systems open the door for engineers, architects and building owners to easily adapt to changing demands, as well as the desire to participate in the global movement towards decarbonization/electrification. Hydronics provide the most adaptable, efficient delivery of heating and cooling regardless of the source and are already compatible with a wide variety of current and future energy sources, including refrigerant-based, thermal and electric heating and cooling sources.

Lower first cost, longer lifespan and lower operating cost combine to deliver the lowest lifecycle cost of any system. Hydronics are the ultimate open system, meaning building owners aren’t locked into any one manufacturer to provide the necessary components required for a complete properly operating system.

(And yes, you read that right, lower first cost. Proprietary VRF systems require specialized technicians for installation and maintenance—which can drive up costs—compared to hydronic water systems designed with universal components that can be installed and serviced by any HVAC service technician. Components in a hydronic system are factory made and tested, reducing rate of failure after installation.)

As interest in renewable energy sources like solar and geothermal increases, building owners and designers are recognizing that hydronics provides the ideal distribution system for these alternative technologies to perform. Moreover, hydronic system efficiency is already well-documented in thousands of real-world applications, making it an extremely convenient option.

Poised for Exponential Growth

Hydronics are applicable in a wide variety of buildings across the commercial sector. In structures like multifamily buildings or high-rises where the level of heating and cooling is unbalanced due to the number of stories and tenants, hydronic systems are a high-efficiency system of choice. Radiant heating and cooling systems use a fraction of the energy of a forced-air system.

With the advent of new hydronic products and technology, the HVAC industry is anticipating an opportunity for rapid market growth. According to Research and Markets, the global hydronic systems market is expected to grow $1.3 billion by 2025. Propelling that market growth is the growing need for energy-efficient cooling and heating systems and an increase in construction activities worldwide.


Reducing wasted HVAC energy consumption is an important element in the push for greater sustainability in the commercial building sector. It is also a solution to significantly reduce operating costs.

Knowing that hydronics are a reliable energy source that outperforms other HVAC systems is key to addressing decarbonization challenges and future-proofing buildings or specific systems within them. Future-proofing focuses on flexibility to handle changing standards and occupant needs, scalability for expansion and the ability to maintain equipment efficiency. Longer lasting equipment that continues to meet the changing needs of occupants reduces costs and improves ROI.

Effecting Sustainable Change

The legislative and economic incentives intended to advance electrification and decarbonization, and the accompanying demand for low-energy and net-zero buildings, collectively represent one of the greatest opportunities for the US hydronics market in decades.

Whether it’s designing an optimized system from the ground up or supplying intelligent pumps capable of adjusting performance to handle challenging environments, hydronic solutions ensure reliability while protecting people and buildings and safeguarding valuable resources for the future. With modern hydronic technology positioned to drive sustainable change, it’s now up to HVAC contractors and commercial building owners to take meaningful action.


1Rocky Mountain Institute

Mike Licastro is Manager of Training and Education - Commercial Building Systems/HVAC at Xylem - Bell & Gosset. He is currently in a leadership role for the Bell & Gossett Little Red Schoolhouse, regarded as the premier Hydronic and Steam systems training and education facility in the Industry since 1954.

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