The business case for investing in heating, ventilation and air conditioning (HVAC) energy efficiency is strong. HVAC systems account for up to 50% of energy use and costs in commercial buildings and office spaces. Several technologies for heating and cooling exist, including reverse cycle air conditioners, electric space heaters, wood-burners and ducted gas heating. The energy efficiency and emissions intensity of these technologies can vary substantially.

As well as the impact of HVAC on total facility energy use and costs, these systems also dominate peak building electricity demand. Improving a system’s efficiency can reduce peak demand charges. Capital and maintenance costs of HVAC also comprise a significant proportion of building costs, and can be minimised through good system design.

While significant energy and capital savings can be made through investing in new, high-efficiency HVAC systems, existing systems can also be optimised. Strategies include reducing demand for HVAC, fine-tuning controls and good maintenance practices.

A good energy efficient HVAC strategy relies on an integrated approach that includes the following measures.

Reduce demand

Methods for reducing demand for HVAC include:

  • improved building insulation
  • high-performance window glazing
  • natural ventilation
  • external window shading
  • proper window coverings.

Painting roofs white or with special reflective coatings can reduce air-conditioning loads significantly, especially on large, flat metal buildings such as warehouses. Controlling internal heat generation from lighting and equipment, and minimising air leakage, can also reduce cooling and heating loads.


HVAC optimisation may require the use of control systems and thermostats, modifications to the ventilation and distribution systems, and the relocation of HVAC units. Investing in improved control, zoning and good maintenance can result in substantial energy savings.

Minor adjustments to thermostat set points can often be made, resulting in energy savings without reducing amenity for occupants.

Advances in engineering enable the measurement of many factors that influence the comfort of building occupants, such as humidity, air movement and surface temperatures of nearby objects, like windows. Optimising these factors can yield further energy savings.


In mild climates, distribution fan and pump energy use can be equal to actual heating and cooling generation loads. A range of more energy-efficient HVAC systems, some of which use passive heat transfer or low airflow rates, can halve mechanical HVAC energy use. Combined with strategies to reduce demand for HVAC services, installing such systems in milder climates can lead to significant electricity savings.

This can also yield substantial water and trade-waste savings, as HVAC systems are responsible for up to 30% of water use in commercial buildings. In more extreme climates, a focus on upgrading and accurate sizing of the heating and cooling units can greatly improve efficiency. The best available reverse cycle air conditioners are about 30 to 40% more efficient than commonly available, ‘minimum standard’ models.


Developments in HVAC systems are occurring at many levels. Multiple component innovations are being packaged into advanced rooftop air conditioners to deliver energy savings of about 17%. Thermal energy storage technologies store heat or cold for use during later applications, avoiding part-load operation and shifting peak loads to off-peak times.

Active solar thermal systems, a new type of heating and cooling system, use free solar radiation—available in Australia for a large portion of the year—to reduce peak demand. Computer technologies are increasingly improving HVAC system management and performance, and building integration. Increased use of economy cycles, night-time passive ventilation, and heat recovery, are all possible with improved air-handling control strategies.

Advanced rooftop packaged air conditioners

Rooftop packaged air conditioners are in common use. Many have good efficiency at full load, but poor efficiency at part load where they most often operate. Increasingly, rooftop packaged air conditioners incorporate advanced features that improve part load efficiency, improve reliability, and reduce energy consumption by about 17%.

Advanced features include:

  • better (variable speed) fans, with greater control
  • inverter controls to vary output
  • economisers, such as ventilation lockout during start-up
  • demand controlled ventilation
  • evaporative pre-cooling of the condenser unit
  • superior monitoring and diagnostics using advanced sensors.

Active solar thermal

Active solar thermal systems capture solar radiation by heating and storing a fluid in a collector. In space heating and cooling applications the heat is transferred indirectly via a heat exchanger. In other applications the hot fluid may be used directly. Active solar thermal systems do not require energy infrastructure, and generate low or no carbon emissions. Since periods of incident solar radiation and cooling loads coincide, solar cooling reduces peak demand.

Computerised control

Computer technologies will continue to enhance HVAC system efficiency, reliability and intelligence, as well as assisting integration with other building services. Accurate and reliable measurements enable efficient HVAC tuning and operation. Intelligent controls allow post-failure assessment, and can provide predictive diagnostics and maintenance advice.

Many advances in commercial building automation and HVAC control will also improve indoor air quality control. The importance of fresh, clean air is understood in modern workplaces, with more emphasis on controlling dust, bacteria, odours and toxic gases.

UV treatment

Research indicates that UV treatment of return air can deliver a high standard of air quality while reducing the dependence on outdoor air supply. This technology also reduces fouling of fans and heat exchangers, improving their efficiency. News Ltd in Australia has used this technology and reduced fouling, with improved efficiency more than enough to offset the UV lamp running costs.

Innovations in refrigerants

Chlorofluorocarbon (CFC) and hydrochlorofluorocarbon (HCFC) refrigerants are ozone depleting substances and have largely been phased out. Commonly used hydrofluorocarbon (HFC) refrigerants are greenhouse gases with high global warming potential and are being phased down - by about 85% by 2036 in Australia. Refrigerants with lower global warming impact are being developed and introduced.

Natural refrigerants are also being more widely used. Different refrigerants can affect energy efficiency and performance in extreme conditions.

Read more

Building management systems

I am your optimisation guide: heating, ventilation, air conditioning and cooling NSW Government

Electrifying Space Heating in Existing Commercial Buildings: Opportunities and Challenges American Council for an Energy-Efficient Economy (ACEEE)

Emerging Energy-Saving HVAC Technologies and Practices for the Buildings Sector ACEEE

Reduce HVAC costs in your business Sustainability Victoria

Window Energy Rating Scheme Australian Glass and Window Association

Case studies

30 The Bond Lend Lease

Council House 2 Melbourne City Council