How to start an HVAC business

The path from technician to contractor of record, in the order it happens: federal refrigerant certification, the state license, insurance, tools, hiring and the first calls, with every agency named. The finding that shapes the rest: EPA lets only Section 608 certified technicians, or an employer with written proof it employs one, buy refrigerant, so a heating and cooling company's supply runs through that certificate.

By Niomi AscotUpdated October 3, 202616 min read

Required by federal law: EPA Section 608 certification to handle or buy refrigerant. It never expires.
Voluntary: NATE certification, renewed every two years with 16 hours of continuing education
Contractor license: Set by each state. Texas asks for 48 months of supervised experience in the past 72.
No state HVAC license: Pennsylvania, which registers home improvement contractors instead
Workforce: 425,200 employed in 2024, with growth of 7% or more projected to 2034 (BLS)
Busiest months: July for cooling and January for heating, with maintenance in spring and fall

What an HVAC company does, and which kind to open

California’s license board defines the trade as work that “fabricates, installs, maintains, services and repairs” warm-air heating, ventilating and air conditioning systems, down to “the ducts, registers, flues, humidity and thermostatic controls and air filters” (California CSLB, C-20 classification). That covers several businesses with different hours, tools and cash needs:

Service and repair. Same-day no-heat and no-cool calls, which Google classes as urgent “because consumers often call HVAC professionals for time-sensitive, urgent needs” (Google, Local Services Ads requirements for HVAC).
Replacement. Whole systems quoted and installed. Heat pumps now lead: 3,644,596 air-source units shipped in 2025 against 3,247,426 gas furnaces (AHRI, December 2025 release).
Maintenance agreements. A cooling check in spring and a heating check in fall, as ENERGY STAR advises homeowners.
Light commercial and refrigeration. Rooftop units and walk-in coolers, often under a higher license class.

In our experience a technician going out alone starts with service and maintenance, which need a stocked van rather than a warehouse, and adds change-outs once a distributor account and the cash to carry equipment are in place.

The outlook for HVAC work

Bureau of Labor Statistics figures for “Heating, Air Conditioning, and Refrigeration Mechanics and Installers”, published through O*NET, show 425,200 people employed in 2024 and a 2025 median wage of $29.33 an hour, or $61,010 a year. Employment is projected to grow by 7% or more from 2024 to 2034, “much faster than average”, with 40,100 projected job openings listed for the period.

The Census Bureau files HVAC and plumbing together under NAICS 238220, which in 2023 had 111,207 employer establishments, 58.3% of them with fewer than five employees (Census County Business Patterns), plus 178,663 businesses with no employees and $14.0 billion in receipts (Census Nonemployer Statistics). Most of the competition is small.

About 89% of US homes used air conditioning in 2020 (EIA), and about 38% of homes with air conditioning ran main equipment 10 or more years old, calculated from EIA’s table HC7.1. Sales swing: shipments of central air conditioners and air-source heat pumps fell 20.0% in 2025 to 7,749,529 units (AHRI, December 2025), then ran 5.5% ahead of 2025 through July 2026 (AHRI, July 2026).

Federal certification: Section 608 is required, NATE is not

EPA Section 608, the legal minimum

Under the Clean Air Act, “technicians who maintain, service, repair, or dispose of equipment that could release refrigerants into the atmosphere must be certified” (EPA, Section 608 requirements). EPA counts anyone “attaching and detaching hoses and gauges to and from an appliance to measure pressure” as a technician, which takes in every tech who opens a sealed system.

Certification	What it covers, per EPA
Type I	Small appliances
Type II	High- or very high-pressure appliances, except small appliances and motor vehicle air conditioning
Type III	Low-pressure appliances
Universal	All types of equipment

In practice, residential split systems are Type II work; Universal spares a second round of testing if the company later takes on chillers or commercial refrigeration. Tests “must be administered by an EPA-approved certifying organization”, the credentials “do not expire”, and apprentices are exempt only while “closely and continually supervised by a certified technician” (EPA, Section 608 requirements). Some programs “offer remote or online testing” (EPA, approved programs).

The rule that matters most to an owner sits at the supply counter. “Only EPA-certified technicians are allowed to purchase” refrigerant, with limited exceptions, and an employer can buy only by giving the wholesaler “written evidence that he or she employs at least one properly certified technician” (EPA, refrigerant sales restriction). If a company’s only certified tech quits, its refrigerant account leaves with them.

NATE, voluntary and built in stages

North American Technician Excellence, founded in 1997, calls itself “the nation’s largest non-profit certification organization” for heating, ventilation, air conditioning and refrigeration technicians, and it “does not directly supervise or employ technicians” (NATE, who we are). No law requires it; owners use it to show skill beyond the legal minimum. Techs with under two years in the field can start with the Ready-to-Work Certificate or the HVAC Support Technician Certification. Full certification, with two years of experience recommended, runs through the five-exam CHP-5 pathway or the traditional Core and Specialty exams, and the specialties include Low GWP Refrigerants (NATE, getting started). Certifications renew every two years through 16 hours of continuing education or a specialty retake (NATE, recertification FAQs).

A company can open without a single NATE-certified tech. It cannot open a sealed system, or buy refrigerant to charge one, without Section 608.

The equipment rules a new company starts under

New residential air conditioners and heat pumps manufactured or imported from January 1, 2025 are limited to refrigerants under 700 GWP (EPA, restrictions by sector). EPA’s May 2026 final rule, effective July 27, 2026, lets equipment built before 2025 be installed “until supply runs out” (EPA fact sheet), except in New York, which keeps its January 1, 2026 date (ACCA). EPA names the replacements as “flammable or mildly flammable refrigerants such as HFC-32 or R-454B” (EPA, HFC questions), so buy A2L-rated recovery and leak detection gear from the start. Federal efficiency minimums since January 1, 2023 are 13.4 SEER2 for split air conditioners and 14.3 SEER2 for split heat pumps, with a higher bar for air conditioners installed in the Southeast and Southwest (10 CFR 430.32). And the 25C credit “will not be allowed for any property placed in service after December 31, 2025” (IRS, FS-2025-05), so no 2026 quote can lean on it.

EPA’s lead paint rule covers paid work that disturbs paint in pre-1978 homes, “even sole proprietorships” (EPA, RRP program), so a duct run cut through old plaster can bring a heating job under it. Change-outs usually need a local mechanical permit too, and the SBA notes that requirements “vary based on your business activities, location, and government rules.”

State contractor licenses

Each state sets its own contractor license, and some leave it to cities and counties. Requirements below are as each agency states them, as of October 2026; confirm the current version with the agency before you apply.

State	Agency	License	Key requirements, as the agency states them
Texas	Texas Department of Licensing and Regulation (TDLR)	Air Conditioning and Refrigeration Contractor. Class A for any size unit; Class B for cooling systems of 25 tons and under and heating of 1.5 million BTUs per hour and under	48 months of supervised experience in the past 72, or 36 months in the past 48 plus a technician certification held for 12 months. Age 18. Exam. $115 for a one-year license. General liability of $300,000 per occurrence and $600,000 aggregate for Class A; $100,000 and $200,000 for Class B
California	Contractors State License Board (CSLB)	C-20 Warm-Air Heating, Ventilating and Air-Conditioning	Four years of journey-level experience in the class, up to three of them creditable from training. Exam. $450 application fee. $25,000 contractor bond. Workers’ compensation whether or not you have employees
Florida	Construction Industry Licensing Board, DBPR	Class A (unlimited) or Class B (25 tons of cooling and 500,000 BTU of heating in any one system) air-conditioning contractor, or mechanical contractor	Age 18. One route is four years of active experience, at least one as a foreman. Exam. Liability of $100,000 and property damage of $25,000 (rule 61G4-15.003). A FICO score of 660 or higher, or a 14-hour financial responsibility course (rule 61G4-15.006)
North Carolina	State Board of Examiners of Plumbing, Heating and Fire Sprinkler Contractors	Heating Group 1 (steam and hot water), Group 2 (ducted systems over 15 tons) or Group 3 (ducted systems of 15 tons or less, plus every single-family home system regardless of size)	Contractor exams need 2 years (4,000 hours) of full-time on-site experience, up to half of it from academic or technical training. No reciprocity with any other state

Texas licenses techs too: anyone doing non-exempt maintenance must at least register as an Air Conditioning and Refrigeration Technician, with no exam and a $20 fee, and work through a licensed contractor (TDLR FAQ). The license number goes in advertising, with narrow exceptions, and on both sides of each company vehicle in letters at least two inches high (16 TAC 75.71).

California requires the license on any job worth “$1,000 or more” or needing a permit (CSLB). The initial license adds $200 for a sole owner or $350 for other business types (CSLB fees), and the bond can be a “contractor bond or cashier’s check of $25,000” (CSLB, issuing your license). C-20 holders must carry workers’ compensation “whether or not they have employees” (CSLB, workers’ compensation). The license number belongs in “all forms of advertising” (BPC 7030.5), and advertising outside your classification is a misdemeanor (BPC 7027.1).

Florida closed its service-only Class C to anyone not licensed by October 1, 1988 (Fla. Stat. 489.105), so a new service company needs Class B, Class A or mechanical, and a certified Class B holder can move up after “a minimum of 1 year of proven experience” (Fla. Stat. 489.111). Journeyman licenses are local, issued after a 75 percent exam score plus a state-approved apprenticeship or 12,000 hours on the job (Fla. Stat. 489.1455). The license number goes in every advertisement, “regardless of medium” (Fla. Stat. 489.119).

North Carolina licenses technicians at 3,000 hours for Class I and 2,500 for Class II, and offers a technical exam waiver with South Carolina (NC board). Class I covers every structure and Class II single-family detached homes (G.S. 87-21).

Where no statewide HVAC license exists. Pennsylvania registers home improvement contractors instead: anyone doing “at least $5,000 worth of home improvements per year” registers with the Attorney General for “$100 every two years” (Pennsylvania Attorney General), and cities may add licenses of their own. Arizona, by contrast, licenses contractors and asks for “a minimum of four years’ practical or management trade experience” (A.R.S. 32-1122). Elsewhere, start at the state contractor board, then ask the city or county building department what it adds.

Setting up the company

Entity and EIN. The SBA notes that “LLCs protect you from personal liability in most instances” (SBA, business structures), and the LLC has to exist at the state before you apply for its EIN. The IRS issues EINs online, and “you never have to pay a fee for an EIN” (IRS), so skip any site that charges for one. Use one legal name everywhere: Google’s Local Services screening checks registration through a D-U-N-S number or state and IRS records (Google, LSA screening).

Sales tax. In Texas, “labor to repair, remodel, or restore residential real property is not taxable”, while nonresidential repair is taxable (Texas Comptroller, Publication 94-116), so one shop can owe tax on an office repair and none on the same repair in a house. Check your own state’s rules before the first invoice.

Insurance. The SBA’s main types are general liability, professional liability, commercial property and a business owner’s policy (SBA, business insurance), but in HVAC the state license minimums and Google’s Local Services requirements set the floor. Add commercial auto for the vans, and in California the $25,000 contractor bond.

Workers’ compensation. California requires it of C-20 holders even with no employees. Florida requires it in construction from “one or more employees” (Fla. Stat. 440.02). “Texas doesn’t require most private employers to have workers’ compensation” outside government contracts (Texas Department of Insurance), and 31% of Texas employers with one to four employees went without it in 2022 (TDI, 2022 study).

Helpers. The IRS weighs “Behavioral”, “Financial” and “Type of relationship” factors, and misclassifying a worker without a reasonable basis can leave a business “liable for employment taxes for that worker” (IRS, contractor or employee). A helper who rides in your van, uses your tools and keeps your schedule looks like an employee under those tests.

Tools, vans, software and suppliers

This list is working knowledge, without prices, because none could be verified.

Vehicle. A cargo van or pickup with shelving and a ladder rack, then a trailer for change-out days.
Refrigerant kit. Recovery machine and cylinders, vacuum pump and micron gauge, digital manifold, scale, leak detector, nitrogen and a brazing kit, with the recovery machine and leak detector rated for A2L refrigerants.
Heating side. Combustion analyzer, manometer and multimeter.
Sizing. ENERGY STAR warns that “improper installation can reduce system efficiency by up to 30 percent” (ENERGY STAR), so load calculation software and a static pressure kit belong in the replacement workflow.
Software. Dispatch, invoicing and maintenance-plan billing, plus call tracking. For Local Services Ads, pick a Google booking partner; the list includes HighLevel (LeadConnector), Housecall Pro, Jobber and ServiceTitan (Google, booking partners).
Suppliers. Open a distributor account early, since the counter asks for 608 proof before selling refrigerant, and ask about dealer programs and the equipment financing many distributors arrange.

Pricing, cash and the two peaks

No source with a stated method publishes typical HVAC prices, so none appear here. The usual structures are a diagnostic fee plus the repair, often from a flat-rate price book; replacements quoted per system in two or three tiers; and maintenance plans billed yearly or monthly. In a 2024 homeowner survey for ACHR News, with no sample size published, 57% would look to spend about $100 a year on a plan, and most wanted parts and labor discounts and priority service along with two inspections a year.

An ad that names a monthly payment or a term must also give the down payment, the repayment terms and “the ‘annual percentage rate,’ using that term” under Regulation Z (CFPB, 12 CFR 1026.24). California caps home improvement down payments at “$1,000 or 10 percent of the contract amount, whichever amount is less” (BPC 7159.5), and in Florida, more than 10 percent up front on residential work means applying for permits within 30 days and starting within 90 days of the permit (Fla. Stat. 489.126).

Cash follows the weather. EIA’s 2025 figures put July at 391 cooling degree days against 5 in January, while January logged 946 heating degree days and July 4 (EIA heating, EIA cooling). AHRI recorded 763,443 air conditioners and heat pumps shipped in July 2025 (AHRI, July 2026 release) and 379,470 in November (AHRI, November 2025 release). Spring and fall maintenance carries payroll between the peaks.

We found no HVAC startup cost figure with a published method, so build yours from real quotes against the SBA’s worksheet lines, such as “Equipment and supplies”, “Licenses and permits” and “Inventory” (SBA, startup costs). Lenders look at the owner first: “loan eligibility for a new business is typically based on its owner’s personal credit score” (SBA, fund your business).

Hiring and safety

Apprentices. O*NET lists 14 Department of Labor approved apprenticeship titles for the occupation. Federal standards call for at least “2,000 hours of on-the-job learning” in a time-based program and recommend 144 hours of related instruction a year (29 CFR 29.5), and “in many states, businesses can qualify for tax credits” for registered programs (Apprenticeship.gov). Since apprentices touch refrigerant only under close supervision, plan those crews in pairs.

Background checks. Google screens HVAC harder than many trades: “HVAC professionals undergo an additional level of screening, which includes service professional background checks” (Google, LSA requirements). The roster includes subcontractors who work in customers’ homes, and “businesses aren’t charged for the background check” (Google, LSA screening).

Safety. OSHA’s fall protection duty starts at “six feet in the construction industry” (OSHA), and rooftop units put crews above that line every week. OSHA’s most cited standards for fiscal year 2025 put fall protection first, construction ladders third, lockout/tagout fourth and respiratory protection fifth (OSHA top 10); an HVAC crew meets all four in an ordinary week.

The phone. Invoca, a call-tracking vendor, found calls to HVAC companies answered 34% of the time across its customers in its 2026 report, against 74% for plumbing (Invoca). A caller who is sweating or freezing tries the next number, so plan call coverage before the second truck.

Finding the first customers

Google Business Profile. If customers never come to your address, Google says to remove it and list up to 20 service areas, no more than “about 2 hours of driving time from where your business is based” (Google, service areas). A rented “virtual office” is not eligible (Google, eligibility), and verification methods “are automatically determined by Google”, with video recommended where offered (Google, verification). Build the profile under the exact licensed name the week the license arrives.

Local Services Ads. HVAC has its own category, “HVAC (heating or air conditioning)”, and screened companies carry the Google Verified badge. Google checks the business, owner and field workers, wants general and professional liability and state licenses where required, and “on average, this process takes 3-4 weeks to complete after submitting your documents” (Google, LSA requirements). Pre-badge ads can run meanwhile, placed “below providers who’ve completed all onboarding requirements” (Google, LSA leads), and reviews and “average response time” feed ranking (Google, LSA ranking). Apply in March to have the badge before the first hot week.

Reviews. In BrightLocal’s 2026 survey, 47% of consumers said they won’t use a business with fewer than 20 reviews, and 74% care only about reviews from the past three months (BrightLocal). The FTC’s reviews rule, in effect since October 21, 2024, covers incentives “conditioned on the writing or creation of consumer reviews expressing a particular sentiment” and review suppression, with civil penalties for knowing violations (FTC). Ask every customer the same way, pleased or not; our review program shows how that runs.

Referrals, partners and tune-ups. ENERGY STAR’s hiring advice to homeowners opens with “Ask friends, neighbors, and co-workers for contractor referrals” and tells them to check “license and insurance requirements for contractors in your state” (ENERGY STAR, 10 tips), so show both on the site and the trucks. Home warranty companies, property managers, home inspectors and your brand’s dealer locator are worth calling first, and a spring tune-up offer to past customers builds a list before July.

The HVAC marketing playbook picks up from here, from the seasonal budget to what an ad may say about refrigerant, and Google Business Profile management covers the profile itself.

Where new HVAC owners get caught out

One certified tech. If that person leaves, so does the right to buy refrigerant. Certify a second tech early.
Undocumented experience. Texas counts supervised months and North Carolina counts hours, so keep pay records and job logs from every employer before going out alone.
Planning a service-only Florida license. It has not been open to newcomers since 1988.
Skipping workers’ comp in California for lack of employees. C-20 holders carry it regardless.
Applying for Local Services Ads in June. The badge can land after the heat.
Last year’s rules in the pitch. The 25C credit ended with 2025, pre-2025 R-410A equipment can still be installed outside New York, and ACCA expects the May 2026 rule to “significantly increase refrigerant prices for all contractors.”
A missing license number. Texas, California and Florida each require it in advertising.

Questions about starting an HVAC business

Do I need EPA 608 certification to start an HVAC business?

Yes, for anyone who will connect gauges or add or remove refrigerant, which covers nearly all service work. The credential never expires, and it is what lets your company buy refrigerant.

Is NATE certification required?

No, NATE is voluntary. It offers entry certificates for techs with under two years in the field and full certification at about two years, renewed every two years with 16 hours of continuing education.

How much experience do I need for an HVAC contractor license?

Usually about four years. Texas asks for 48 months in the past 72 and California for four years, as does one Florida route; North Carolina asks for 4,000 hours, half of which can come from school.

Can I work in HVAC before I hold a contractor license?

Yes, as an employee of a licensed company; Texas techs register for $20 with no exam. Contracting in your own name needs the license wherever the state requires one, which in California means any job of $1,000 or more.

What insurance does a new HVAC company need?

General liability at or above your state’s minimum, workers’ compensation where state law requires it, and commercial auto. Local Services Ads add professional liability.

How long does it take to get on Google Local Services Ads?

About three to four weeks after you submit documents, on Google’s stated average, with pre-badge ads available in the meantime.

Can I still offer customers the federal heat pump tax credit?

No. The IRS ended 25C for property placed in service after December 31, 2025; confirm any state or utility rebate locally before quoting it.

How seasonal is an HVAC business?

Very: July’s equipment shipments were about double November’s in 2025, and spring and fall maintenance fills the gaps between peaks.

Sources

Checked on October 3, 2026. Rules and fees change, and many are set state by state or city by city: confirm the current requirements with the agency that issues them before you apply.

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