Thursday, March 21, 2019

Company makes 2020 certified warm air furnace for under $2,000 - and stirs controversy

Paul Van Der Eems, Dan Haynes,
and David Walters of HY-C accept
a Vesta Award for their furnace.
Many said it could not be done.  A competitor called it “preposterous.” But HY-C, a Missouri company that makes a budget line of warm air wood-fired furnaces, is well on their way to being ready for June 2020, when stricter EPA regulations come into effect.  

Their first 2020 compliant model, their smallest unit, was certified at 0.106 lb/MMBtu Output, well under the .15 allowable. The suggested retail price is $1,899 which is only $100 more than the previous unit that was certified to the 2017 standards.  HY-C won a Vesta Award for the furnace at the industry’s annual expo in Dallas last week.

In 2014, HY-C went to the EPA and urged them to adopt a laddered approach, giving companies several years to get certified and several more to meet a stricter standard. “The EPA was responsive, giving us a total of 5 years,” owner, David Walters, recalled in a phone interview.  David said that  when they bought the company in 2011, the NSPS process was well underway, and they knew they would have to change and clean up.  “It wasn’t easy, but we did it, and that is good for the environment, for consumers, and for us, the manufacturer,” David said.

The HY-C FC100E is the first
low-cost wood fired forced air
furnace to meet the strict EPA
2020 emission standards.
The EPA won’t list a certified unit on the list of certified appliances until the company posts their lab test report on their website.  Parts of those reports are highly technical but provide key information for consumers and others. The HY-C report said the unit only achieved 50% efficiency and was certified using a slightly modified test protocol that had been approved in advance by the EPA.  Intertek laboratories did the testing using about 36-pound loads of cord wood that had about 22% moisture content.  The five tests ran 3 to 6 hours.  Their target output was 13,000 – 37,000 BTUs but the certification test obtained 20,000 – 34,000, due in part to the modified test protocol. 

To date, the only other company to have a 2020 compliant forced air furnace is Lamppa Manufacturing, which hit .09 lbs/MMBtu several year ago and has a 54% heat transfer efficiency, slightly above the HY-C unit.  That unit, the Vapor-Fire 100 is currently priced at $5,695 and also obtained a test protocol variance from the EPA in the test protocol.  The Vapor Fire weights 670 pounds, which may indicate thicker and more durable materials compared to the HY-C unit at 435 pounds.  
The Lamppa Vapor Fire
100 is the only other 2020
compliant wood furnace,

Another big player in the forced air furnace space is US Stove, and it’s unclear when they will have a 2020 compliant unit.  Of their eight units certified to the 2017 standards, one came in at 33% efficiency and an average of 60% efficiency. US Stove is urging the EPA to repeal the Step 2 standards for forced air furnaces, arguing that agency picked a “compliance limit out of thin air with not [sic] real data to support it.”  In a filing with the EPA, they said that the EPA’s timeline of going from an uncertified appliance category to meeting .15 mmBTU “is preposterous and unrealistic.”  HY-C appears to have just proved otherwise.

However, the willingness of the EPA to approve alternative test methods can be controversial, and companies often claim a competitor got an unfair advantage with a particular variance.  The EPA is not supposed to approve variances that make the protocol easier to pass, but that may just what is happening in some instances.  Variances are a critical tool for the EPA to allow for innovative products to be fairly tested and they also create a precedent for others to receive similar variances.

The largest player in the Canadian forced air furnace market is Stove Builders International (SBI) and they do not directly compete in the budget market with US Stove or HY-C.  SBI is also working on certifying furnaces to the 2020 standards but “we are trying to achieve the desired performance without using the alternative test method that the EPA has granted to others,” said Marci-Antoine Cantin, of SBI.  “We want to put out a product that cycles combustion and doesn’t just cycle the blower, while the unit is kept burning at a single burn rate,” Cantin said.  

HY-C sells their furnaces through a variety of distributors and retailers, including many big box stores. They provide all of their own customer services and have tens of thousands of units in the field that provide them with intensive customer feedback.  They make all of their furnaces in St. Louis Missouri and have extremely little inventory of non-2020 inventory left and expect to start shipping 2020 compliant units in July.  “We worked hard with distributors, so the pipeline of older units is dry,” Walter told us.  As a result, they have abstained from the debate as to whether the wider industry needs a 2-year sell through for units that are not 2020 compliant.  Lamppa has been an outspoken defender of the original timelines, arguing that a 2-year sell through would be unfair. Click here for more on that debate.

Both US Stove and HY-C say that their customer base is very price sensitive and need a furnace under $2,000, if not close to $1,500.  Other industry experts have questioned how so many people came to expect a whole house furnace for less than the price of an average wood stove and assumed that price would have to climb substantially to meet 2020 emission standards.  At the core of the fight between industry, states and air quality agencies is whether the price of wood appliances and costs to manufacturers should drive EPA standards more than other factors.  While HY-C was able to meet both the timeline and the emission standards, it is still unclear how well it will be received by the general public.  Both US Stove and HY-C also make “coal only” units that are exempt from EPA emissions, but sell side-by-side in many stores with the regulated wood units. 

The EPA exempt US Stove
1357 Hotblast  "coal only" furnace
also advertises "21 in. log 
capacity" at Home Depot
According to one industry insider, Tractor Supply Company stores is the biggest seller of wood furnaces from their 1,700 US stores.  Floor staff at chain hardware stores like this have reportedly been trained to inform consumers that the “coal only” units can burn wood perfectly well.  Companies that make both wood and coal units benefit from this and can sustain market share, even as EPA standards tighten.

Certifying to 2020 standards appears to have led to shorter burn times and more finicky furnace and boilers.  HY-C advertised up to 12-hour burn time and a maximum of 130,000 BTU output for the unit as certified to 2017 emission standards.  The EPA listed BTU output up to 45,000.  The 2020 version only had up to 6-hour burn times in the lab and a maximum of 34,000 BTU output.  Both the 2017 and the 2020 model accept 20-inch logs, but the efficiency dropped from 69 to 50%.  Can the 2020 version meet consumer expectations at virtually the same price? 

But for now, HY-C achieved what they set out to. “We planned to build a better mouse trap and we feel that we succeeded, with advice from industry experts and our consumers,” David Walter said.  “In America, we should not take for granted that we have clean air and water, thanks to Congress and decades of work by the EPA,” Walter continued.  If anyone thinks the EPA efforts are a waste of time, Walters says all you have to do is visit Shanghai or some other foreign cities. “It’s so polluted you can barely walk outside and see the other side of the street,” he said.