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Things Are Heating Up In HVAC

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Tap into the growing demand for HVAC solutions driven by aging infrastructure, construction growth, and rapidly expanding data centers with the AdvisorShares HVAC and Industrials ETF.
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Data center2The rapid growth of digitalization and AI technologies is driving a surge in data centers worldwide, particularly in the U.S., which accounts for over 32% of global data centers and is projected to be the fastest-growing market through 2030; however, cooling solutions—responsible for 40% of a data center's energy consumption—are critical to managing the significant heat generated, with U.S. electricity demand for data centers expected to rise by 23% between 2024 and 2030 (from 147 to 606 terawatt-hours).

Sources: "2024 Electricity,” Jan. 2024, International Energy Agency; “How Data Centers and the Energy Sector Can Sate AIs Hunger for Power,” Sep. 2024, McKinsey &Company.

HVAC-mainteance
  • Over $10 billion USD is spent annually on HVAC repair and maintenance.
  • The average lifespan of an HVAC unit is now 13 years, nearly 40% lower than a decade earlier, due to extreme climate events & a warming environment.
  • Each year, 2-3 million heating and cooling systems undergo replacement.
Sources: “US HVAC Systems Market Size And Share Report, 2030,” Feb. 2024, Grand View Research; 3 “Extreme Heat Strains Air Conditioning,” July 22, 2023, Wall Street Journal.

HVACAs populations grow in developing countries, so does the demand for housing and commercial infrastructure, driving the need for HVAC systems.

  • By 2050, nearly two-thirds of households worldwide could have air conditioning, with China, India, and Indonesia accounting for half of these units.
  • 87% of homes in the United States and Japan already have at least one AC unit. However, only 8% of homes in the world’s hottest regions — home to 2.8 billion people — currently have access to air conditioning. 

Sources: Science Direct, Projected global demand for air conditioning associated with extreme heat and implications for electricity grids in poorer countries, August 2022; IEA, The Future of Cooling, May 2018.

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