February 10, 2020

What Is HVAC as a Service? Maybe, the Future of HVAC

For decades, innovation in the HVAC industry has revolved around improving equipment—making it more efficient, more eco-friendly, and smarter. Even ducting, vents, and caps have undergone precision engineering to ensure peak performance. 

But there could be a new area of innovation in the HVAC industry. Recently, a new business model for HVAC manufacturers and service companies has begun to surface: HVAC as a Service, or HVACaaS.

Could this proposed new model be the start of a new trend? Only time will tell but if you’re a leader at an HVAC company that relies on maintenance and service calls for business, HVACaaS is worth exploring now.

What is HVAC as a Service?

One of the earliest advocates for HVACaaS, Steve Shaw from the Sierra Monitor Corporation, likens the concept to that old adage about digging a hole in the ground. People don’t buy a shovel because they want a ‘shovel’, he says, they buy a shovel because they want a ‘hole in the ground’.

Put another way, people don’t really buy shovels at all. They buy holes in the ground. In an HVACaaS model, customers don’t buy (or lease) HVAC equipment—they buy hot and cold air as a service.

It works like this: HVAC manufacturers offer a subscription-based service for use of their equipment, which they fully own and maintain. That equipment is fully connected to the cloud and the manufacturer actively operates the equipment and monitors the data to ensure proper functionality.

Under this model, it’s entirely the responsibility of the manufacturer to schedule preventive maintenance and service calls.

Benefits of HVACaaS

As a value-added service and additional source of recurring revenue, HVACaaS is a potential game-changer for forward-thinking manufacturers.

For HVAC customers (including building managers and facilities managers), this model means they don’t have to actively operate, monitor, or maintain equipment they might not fully understand.

Instead, the original manufacturer oversees the operation and maintenance of the equipment, ensuring it’s working as efficiently as possible.

Opportunity for HVAC companies

If you’re the owner of an HVAC company that relies on maintenance and service calls for revenue, the idea of HVACaaS offered by manufacturers might sound like a risk to your business.

That may or may not be true but until HVACaaS becomes more mainstream it’s impossible to say how exactly it will unfold.

It’s just as likely, however, that manufacturers offering HVACaaS will outsource some, or all of that service to third parties. This could include monitoring data, remote operation, scheduling service calls, and performing on-site maintenance.

For HVAC companies, this presents a unique opportunity to partner with equipment manufacturers and offer a new kind of service to end customers.

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