Commercial RTU 2025 State of the Market Report
Results
- Manufacturers and distributors noted low awareness of next gen rooftop unit (RTU) products among contractors and customers due to few interactions with dual fuel heat pump RTUs and ERVs.
- Contractors and manufacturers expressed skepticism about dual fuel heat pump RTUs’ heating performance and value proposition in Minnesota’s cold climate.
- Despite mixed perceptions, many market actors expressed cautious optimism that next gen RTU adoption could increase over time as market signals, such as increased awareness, education, and incentives, shift.
Highlights
Objectives
Examine the current commercial HVAC market — particularly around stocking practices, purchasing processes, and leverage points for incentives — to track market progress and better understand how to increase adoption of dual fuel heat pump RTUs and energy recovery ventilators (ERVs).
Scope
Cadmus, on behalf of Minnesota’s Efficient Technology Accelerator (ETA)*, undertook data collection efforts in 2025, including interviews with three commercial HVAC manufacturers, three commercial HVAC distributors, and 25 commercial HVAC contractors, as well as an online survey of 65 building owners and facility managers and in-depth interviews with two HVAC experts.
Benefits
A more thorough understanding of the HVAC market will strengthen, specify, and streamline the efforts of the Next Gen RTU initiative, leading to greater market adoption and cost- and energy-saving benefits for customers and stakeholders across the supply chain.
Project Summary
Key findings from this research reflect perspectives gathered across the commercial HVAC supply chain, including manufacturers, distributors, contractors, building owners, and subject-matter experts. Findings are based on interviews and surveys conducted in 2025 and describe prevailing market conditions, levels of familiarity, perceptions of technology performance and value, and factors influencing equipment availability, purchasing decisions, and adoption.
While individual findings vary by market actor and technology, the themes summarized highlight patterns observed across the data and provide context for understanding current barriers, opportunities, and leverage points for increasing adoption of dual fuel heat pump RTUs and ERVs in Minnesota.
* Minnesota's Efficient Technology Accelerator is a partnership funded by the state’s participating investor-owned utilities (IOUs) and consumer owned utilities (COUs), administered by the Minnesota Department of Commerce, Division of Energy Resources (DER), and implemented by Center for Energy and Environment (CEE).