IT WAS 90 DEGREES—and we were the unfortunate owners of a broken, 18-year-old heat pump. After evaluating our system, one heating, ventilation and air conditioning (HVAC) contractor recommended replacement at a cost of $7,472.
Reluctant to spend that chunk of change, we opted for a second opinion. Company No. 2 spent an hour and a half at our house, changed out a capacitor, added refrigerant and treated the system with “stop-leak,” all for $837.99. The unit has been functioning smoothly ever since.
All of which raises an obvious question: What accounts for the radically different approaches to the same problem?
Aging technology affects many conveniences of modern life, from home appliances to computers to automobiles. These items often function in the background, quietly doing their jobs while keeping us comfortable—until they break. At that juncture, most homeowners have no clue what they’re dealing with, as I belatedly discovered when I asked my father—an HVAC contractor with 40 years of experience—about our heat pump repair.
Heat pumps work by moving heat into or out of our homes, depending on the season. In the winter, they sequester heat from the outside air and pump it inside, heating our homes. In the summer, the reverse process occurs, as they remove heat from inside and pump it out. A refrigerant inside the heat pump mediates both the heating and cooling cycles.
“Freon,” a term trademarked initially by DuPont, is now known as R-22. It’s the time-honored refrigerant used in heat pumps. By the 1990s, Freon was associated with ozone depletion. As a result, the Environmental Protection Agency mandated that manufacturers phase out R-22 by 2020. A substitute refrigerant, MO-99, evolved as an alternative and can be used in older heat pump systems.
Meanwhile, a decade ago, a new style of heat pump appeared, which utilizes a completely different refrigerant, known as 410. This refrigerant is incompatible with older systems, due to an inherent pressure differential. Got all that?
Back to the classic dilemma we faced: repair or replace? HVAC professionals split into two camps. The repair camp buys into the importance of maintaining what we own. They tend to be more frugal and more patient with the uncertainty of the troubleshooting process. They also tend to be more creative when considering possible solutions. Meanwhile, the replacement camp emphasizes the definitive fix, arguing that upgrading now will avoid future costs associated with further deterioration of the older system.
But margins also play a part here. In general, it’s more profitable for the HVAC contractor to replace a unit than repair it. The markup on a new unit installation is generally 50% to 100%. If the wholesale cost of a new unit is, say, $2,200, the cost to the homeowner can be well over $4,000. This lack of price transparency leaves considerable room for unsound ethics: HVAC professionals have the upper hand, thanks to the knowledge gap between them and homeowners.
That doesn’t mean repairing will necessarily be a bargain. It can take hours to troubleshoot a broken heat pump. Also, in our state, there is a 6.75% tax on service work—but this tax isn’t charged on new installations, so it further discourages repairs. In addition, wholesale refrigerant prices influence HVAC repair bills. As of this writing, prices for refrigerants in North Carolina ranged from $4 to $15 per pound, depending on the refrigerant type. As a line item on any HVAC bill, refrigerant can be subject to an almost unlimited markup.
So what should homeowners do? Should you patch up your old heat pump system—or change it out for a newer one? As you tackle the question, information is power. When systems break, a working knowledge of heat pumps and refrigerants can help homeowners ask intelligent questions of HVAC contractors—and simply asking the questions may prod contractors to offer you the most cost-effective solution.
Back to that $837.99 bill for our repair. After digging deeper, we were likely overcharged. A capacitor is a $2 part. Stop-leak runs about $60. I don’t know which refrigerant was used in the repair, because it was listed only as Freon on the bill. The upside: The system has been cooling without a problem since the repair and, with any luck, it’ll keep chugging along for many years to come. My father says he services a system that’s been around for 40 years.
Brian Downs is a writer, physician and surgeon. You can read more of his writing at CognitiveBuffer.com.