Characterization of the Heat Pump and Hybrid Clothes Dryer Market

Evergreen Economics conducted a comprehensive characterization of the market for residential heat pump and hybrid clothes dryers. The Northwest Energy Efficiency Alliance commissioned this study to help inform its initiatives to promote energy-efficient clothes dryers.

Clothes dryers are becoming an increasingly important target in efforts to increase the energy efficiency of North American homes. While most major energy-using residential appliances have undergone advances that increase their efficiency, clothes dryers continue to rely on fundamentally unchanged decades-old technology and thus represent an ever-increasing share of residential energy use.

In recent years, two developments have presented themselves as opportunities to reduce the energy consumption associated with residential clothes drying: manufacturers have rolled out heat pump-based clothes dryers in the North American market that offer energy savings in the 25 to 70 percent range, and introductory ENERGY STAR® specifications mean consumers can now distinguish more energy-efficient conventional dryers from less efficient ones.

Some key goals of our research included:

  • Describing the demand side of the market, such as:

    • - Consumer awareness and understanding of dryer technology types;
    - Consumers’ dryer preferences and purchasing behavior; and
    - Opportunities and barriers to changing consumer purchases.

  • Describing the supply side of the market for heat pump clothes dryers (e.g., manufacturers’ strategies and plans; retailers’ perceptions, sales distributions, and stocking practices; and market prices).

As part of this project, our team facilitated several focus groups of household decision-makers to elicit nuanced information about laundry practices, purchase preferences and behaviors, and households’ understanding of and receptiveness to different technologies and attributes. We built on these findings with a general population web survey of households in which we explored product preferences and tradeoffs through a structured stated choice exercise. The ensuing analysis provided the program team with empirical insights about consumer willingness to pay premiums for heat pump and hybrid dryers and the potential impacts on market penetration of efficient dryers from varying rebate levels and strategies.

This research showed that consumers were clearly interested in energy-efficient dryers. The majority showed an inclination to pay a marginal cost increase of $100 for an ENERGY STAR dryer for energy savings of 5 to 20 percent. Meaningful minorities of participants in the focus groups and survey also showed interest in heat pump and hybrid dryers. Selling points included energy savings and the adoption of new technology, while purchase price, cycle length, and reliability were potential concerns. The stated choice analysis suggests that a rebate of at least $200 is necessary to materially increase the likelihood that a consumer will purchase a heat pump or hybrid dryer.

The study also comprised interviews of manufacturers, retailers, and market observers.