AC drives are an essential part of the HVAC marketplace, and the growth of the market looks to be exceptional over the next few years. According to MarketsandMarkets, the market is expected to grow from an estimated $15.72 billion in 2016 to $22.07 billion by 2021.

“The demand for variable frequency drives (VFD) is growing across the U.S.,” said Nichole Angiola, product manager, Eaton. “New legislation and regulations are driving the demand in California and Europe, which is affecting the entire U.S. market. California updated its energy standards through its Title 24 to reduce the state’s energy footprint and carbon dioxide emissions. Title 24 requires VFDs be installed on motors in HVAC applications, down to 5 horsepower in some applications. This standard is starting to expand into other states and markets. As uptime becomes more costly and motors are becoming larger due to higher demand processes, VFDs are being installed more frequently and are replacing traditional across-the-line starters because they’re able to provide additional protections and monitoring capabilities. This is a trend we’re seeing across all major industries throughout the U.S., including pumping, HVAC, machinery equipment, and packaging.”

Richard Jennens, product manager, industry business, Schneider Electric, said that while the overall demand is certainly increasing, there are also strong regional trends emerging.

“The need for increased energy efficiency is universal and many retrofit projects are underway to enable this,” he said. “We’re seeing a push for connected, smart machines as the Industrial Internet of Things (IIoT) becomes a focus and new VFD technologies allow users to make pumps, fans, and other machines smarter. The regional trends are driven by market needs. Demands relating to water supply and irrigation are growing, especially in the Midwest and the West Coast. Oil- and gas-related extraction applications are starting to see an increase again as the oil price trends upwards. This further drives regional demand where exploration is taking place.”

David Schrader, general manager, AC drives and human machine interface (HMI) departments, Fuji Electric Corp., noted that regional demand for drives in the U.S. has become somewhat volatile, as each region has its own drivers that impact the growth of a particular market.

“For example, the demand in the South is highly dependent on the oil and gas market,” he said. There is an indirect relationship between oil prices and the demand for drives.”


With the drives market on the brink of great expansion, the current state of the national marketplace is one of great optimism.

“After a VFD market contraction in 2015, we anticipate healthy growth over the next five years,” said Angiola. “Energy consumption is a very hot topic for most facility or building owners. In hospitals, it’s a way to improve the bottom line. They can reduce their annual energy spends by installing VFDs and capitalizing on the immediate cost savings by running a motor at partial speeds and following system demand requirements. This is one of the ways that many market reports are expecting U.S. market growth over the next five years.”

Don Cameron, product manager, Johnson Controls Inc., highlighted that HVAC drives are most definitely a reliable, sometimes double-digit source of growth, even in the worst of economic times. “Fast forward to 2017, and the aging fleet of the installed base will be a significant factor going forward,” he said.

Jennens noted interest in retrofit projects where existing older installations of motors are being updated with newer technologies to provide improved performance and energy efficiency is increasing. He said new installations are starting to increase as the economy improves, which is causing construction and infrastructure projects to pick up again.

Schrader said there is also pressure on manufacturers to offer advanced technology and greater features at lower prices. [That pressure] is causing flat total revenue of the drives market while unit volume is up,” he said. “Advanced technology in drives is also spurring the development of niche products specific to markets and even customers.”


Customer and market-specific drive-related products have certainly permeated throughout HVAC, with manufacturers looking for new and unique ways to innovate within the space.

Fuji Electric’s FRENIC-HVAC drive features a slim, space-saving design; real-time clock; embedded BACnet; and all other functions required to independently operate fans and pumps in air conditioning equipment. “The development of our HVAC drive was based on a demand from our customers for energy-saving inverters with superior fan control,” said Schrader. “The FRENIC-HVAC helps reduce bearing currents and motor issues and features a built-in reactor and EMC filter to reduce the harmonic content. It also features built-in BacNET communication. The flexibility, permanent magnet (PM) motor control, and multiple power ratings of the FRENIC-Ace make it an ideal choice for OEM applications.”

Schneider Electric recently expanded its variable-speed drive offerings to include a new line of drives for machine automation — the Altivar Machine ATV320 range. “The Altivar Process range, designed for process optimization, asset protection, and energy management, has also expanded with new offerings, such as the low harmonic systems drives, which provide smaller, cheaper motor control with more stable power management in large installations as well as new options in enclosed and outdoor Altivar process drives,” said Jennens.

Eaton launched a VFD platform in 2014 called PowerXL and has been expanding the product line and broadening its capabilities ever since. “The PowerXL DG1 is a general-purpose VFD with application-specific, built-in applications; exceptional energy efficiency; and extensive built-in communication and I/O connection points,” said Angiola. “The dual Ethernet IP communication card allows low-cost, compact drives to connect to processes over the most used communication protocol in the industrial space.”

Johnson Controls has most recently released its Factory Packaged Series II for York air handlers.

“Providing factory installation of the drive, which meets the field specification, provides a competitive advantage on many projects,” said Cameron. “Having the same solution available for field installation ensures the path to market is not an issue.”


With a multitude of new, technology-rich products expected to hit the drives market in the coming years, manufacturers are confident that demand within the space is going to steadily increase.

“The trends of efficiency, connectivity, safety, and performance will continue,” said Jennens. “Electric motors remain an enormous part of industrial automation, and VFD’s provide such a significant benefit to many installations — both in energy efficiency and motor control — that we expect the future prospects to remain positive.”

Jennens also touched on the continuing expansion of capabilities within the drives beyond the basics of running a motor. “Whether that’s integrated machine safety, equipment and asset protection, or integration into the IIoT, the abilities of the drives to provide benefits beyond efficiently turning a motor shaft continue to increase.”

Cameron said the fact that drives are one of the few products with payback measured in months will help the market demand continue to grow and become more connected.

“Hundreds of thousands of motors await the installation of their first drives,” he said. “In addition, local utilities will many times provide rebates for the installation of drives, and those rebates could cover the entire up-front cost of the drive.”

Cameron said that one particularly exciting prospect is the potential to upload commissioning parameters to the drive supplier and initiate the product’s warranty at the conclusion of a start-up.”

Schrader has somewhat tempered expectations, saying that energy costs have a significant impact on market growth, but anticipates flat to modest growth over the next several years.


A blossoming marketplace can only benefit contractors, and manufacturers see numerous ways that those advantages will be felt.

“Having VFD knowledge and capabilities provides a competitive edge and creates an additional revenue stream,” said Angiola. “Contractors able to install and service VFDs can provide service in-house and not depend on third-party companies. Contractors that are VFD experts become the go-to sources for new projects and when things go wrong.”

Jennens said that by adding an AC drive, contractors are able to easily provide a host of additional features and benefits, including energy efficiency, equipment protection through embedded diagnostics, remote and automated troubleshooting, and flexible process control, just to name a few. “Drives are the Swiss Army knives of process automation, providing advantages to a wide range of installations and delivering benefits that often exceed performance requirements,” he said.

Schrader mentioned how the reduced maintenance costs and ease of serviceability of drives cannot be underestimated. “Drive systems are cleaner and easier for contractors to maintain and therefore offer customers a solution with lower total costs of ownership,” he said.

Publication date: 2/6/2017

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