Upgrading heating, cooling & refrigeration equipment

Replacing your equipment is an opportunity to improve your business energy performance. Find information on key equipment upgrade areas that help enable smarter planning and long-term gains.

Smarter equipment reduces energy costs

Replacing your equipment isn’t just a maintenance task to tick off at the end of its life — it’s a chance to improve energy performance for your business. Upgrading with more efficient, innovative technology can lower operating costs, improve resilience to rising energy prices, and boost productivity.

Planning for upgrades means you can avoid rushed decisions and make choices that deliver long-term value.

Improve energy efficiency through replacements

Many businesses only consider equipment upgrades when something fails. This reactive approach often leads to quick ‘like-for-like’ replacements that miss the opportunity for better performance, lower operating costs, and improved energy efficiency.

While a like-for-like swap can get things up and running quickly, it can lock in the losses of older, less efficient technology. Today’s equipment options often include smart controls, better efficiency, and the ability to use with New Zealand’s clean, renewable electricity — making it easier to reduce energy use and operating costs long term.

Benefits of efficient industrial equipment include:

using less energy to achieve the same or better output
reducing energy bills and ongoing maintenance costs
helping to minimise peak electricity demand — supporting grid stability and reducing stress on supply
improving operational reliability and productivity in the long term.

Why upgrade your technology?

Technology is evolving fast, with high efficiency options becoming more accessible in New Zealand. Planning for equipment replacement as part of an asset management strategy helps businesses avoid rushed decisions, maximise return on investment, and future-proof operations against energy constraints.

Get upgrade guidance

Big ticket upgrades worth investigating

Refrigeration, heating and cooling, and hot water are typically the biggest energy users of any business – making up 45% of a typical energy bill of a commercial building. This makes them the greatest opportunity to improve on energy efficiency, reduce costs, and improve productivity.

Efficient heating and cooling for the workplace

Key tips for running your heating and cooling system efficiently, and considerations for installing new systems or upgrades.

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Efficient refrigeration for the workplace

Refrigeration systems are one of the biggest energy users for many businesses — making them a key area for cost and energy savings.

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Upgrade your technology

Switching to efficient technology can have big payoffs for your business.

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On site equipment opportunities

Below is a list of common technologies that are big energy users, and opportunities to optimise their performance.

To get the most out of your boiler system, focus on maintenance of key components and improving control settings. There are also opportunities to switch fuels and recover waste heat to drive greater efficiency and lower energy costs.

Optimising your boiler’s efficiency and performance
- Check and monitor the excess air.
- Check for insulation damage and leaks.
- In solid fuel combustion systems, check fuel is distributed evenly on the bed.
- In liquid or gaseous fuel combustion systems, check the flame patterns are correct.
- Make sure heat transfer surfaces are clean, or can be cleaned easily and often.
- Review boiler set points to minimise short cycling.
- Modify boiler sequencing to ensure the most appropriate boiler is matched to the demand.
- If flue gases are above 120°C, investigate opportunities to fit an economiser.
Opportunities with fuel switching
Electric — High temperature heat pumps are the way to go if your temperature needs are up to 100°C (or 120°C in some instances). They’re highly efficient and commercially available and use New Zealand’s highly renewable electricity.
Biomass — Is a viable alternative if your energy use is relatively stable. It can replace coal or be used as a co-firing option.
Electro-boilers — May suit if you have peaking energy use. They’re convenient, low capital and low maintenance investments, with the downside of having a higher energy cost.
Mixed options — Can work for energy uses with a strong regular base (provided by a biomass boiler) and some peaking (provided by an electro-boiler). This helps you find the best economic balance between capital cost and energy cost.

Pre-heating combustion air

Combustion air is low temperature, so can be pre-heated by almost any waste heat stream. Pre-heating combustion air increases your boiler efficiency.

Additional resources

Technical Guide: Boiler tuning [PDF 407 KB]
Consider whether compressed air is the right option for any new or existing application. You may be able to eliminate the use of compressed air equipment with electrically driven motors or valves. If not, investigate areas to potentially reduce demand.

Maintaining your compressed air system

Common problems can make your compressed air system run less efficiently.
- Repair air leaks — 20% to 30% of compressed air demand can disappear this way. A well-managed system will have less than 10% leakage.
- Avoid unnecessary use — Such as using high pressure air when low pressure air would suffice – like for cleaning or using it in mechanical applications where an electric drive is used.
- Avoid fluctuating demand — Large fluctuations in demand from equipment attached to a system can cause large pressure drops across that system.
- Check for pressure drops — Check for rust, undersized pipes, or pipe constrictions and unnecessary deviations, and partly-blocked filters. These can all cause pressure drops in the air network.
These can help you avoid wastage:
Pressure regulators — Minimising supply pressure needed for air-driven equipment can cut demand.
Measuring flow and pressure — Use the equipment specification and use profiles of each piece of equipment to estimate the network airflow demand.

Optimise your supply

Compressors need to accommodate the pressure and flow requirements of the network. It’s important that your compressors are correctly sized to meet demand on the system. Other factors influencing supply-end efficiency include:

Controlling multiple compressors — Arrange ‘run order' to match air supply to demand and make sure machines are operating at their optimum efficiency. For example, base demand could be met with a fixed speed machine and any peaks in demand supplied with a variable speed compressor.

Variable speed compressors — Variable flow compressors match air supply to demand (eliminating off load running) and are typically more efficient than fixed flow machines where air demand is variable.

Compressor supply pressure — For every 1 bar the compressor is set over the required pressure, the system loses about 7% efficiency.

Drier selection and sizing — Over-drying the air wastes energy. A faulty drier can cause excessive pressure drops.

Environment and maintenance — Air compressors are often installed in service areas with boilers, pumps and chillers. Radiant heat affects air compressor efficiency, generally by 1% for every 3°C the intake air is above outside ambient air temperature.

Recover wasted heat

About 85% of energy used to run an air compressor turns into heat. Explore ways to use it, such as ducting the hot air from the air compressor cooling vents to heat workspaces or using a heat exchanger to heat water.
A well-maintained and properly optimised distribution system can significantly reduce energy losses and pumping costs. This can be done by improving flow control, minimising waste and ensuring the system is sized, routed and insulated for efficient operation.

Maintaining your distribution system
- Remove throttling valves — These are an energy inefficient way to regulate flows because water pumps use electricity needlessly at lower flow rates.
- Use variable speed drives (VSD) — VSD or frequency converters reduce the rpm of a pump to adjust the flowrate. Note that halving the rpm doesn’t mean halving the energy cost: it divides it eightfold.
- Repair leaks — Stay on top of these maintenance jobs even if they don’t seem urgent. Change valves and cocks, and renew seals, or the costs will start piling up. The repair is always cheaper.
- Insulate the distribution system — As well as pipes, insulate valves with removable insulation. Be sure insulation remains dry and is replaced in case of a leak — wet insulation can dissipate more energy than no insulation at all.
Optimising your distribution system
Rationalise your system — Ensure all dead legs are removed. Unused sections act as heat exchangers and dissipate energy for no purpose.
Right-size — Make sure distribution system pipes are an appropriate size for the demand. Pipes that are too small will drastically increase pumping system electricity consumption.
Re-route opportunities — Any hot piping that may be passing through chilled or air-conditioned spaces will be wasting energy.
Once you’ve invested in an efficient motor, focus on the whole system — how it’s installed and how it’s operating.
If you have a system run by an electric motor — such as a pump, fan or compressed air system — replacing or optimising the use of these components may be a better opportunity to save on energy and costs. However, there are maintenance tasks and optimisations that can make them run more efficiently and extend the life of your motor.

Maintaining your electric motor system
Use quality-certified motor rewind workshops — Rewinding an old motor revitalises it and can restore efficiency, but it needs to be done well. A poor-quality rewind to a 55kW motor can result in a 3% reduction in efficiency. If that motor then runs fully loaded for 6,000 hours per year, you’ll be wasting energy worth around $2,000 a year (at 22 cents per kWh). Reduced reliability and increased maintenance can cost you more on top of this.
Regularly service gearboxes — Worn gearbox seals can leak oil, increasing friction and lowering efficiency. Prolonged operation with low oil levels can cause gearbox failure. A regular service can save up to 5% of motor energy use.

Optimise your electric motor system

Replace standard V-belts — These have an efficiency of 93% to 98% depending on their age and tensioning. Cogged belts are generally 2% more efficient than standard V-belts, while synchronous belts typically have an efficiency of 98% and maintain this over their life.

Bypass soft starter units — Motor soft starters typically have energy losses equivalent to 3% of the motor’s power, dissipated as heat. Once a motor is running at full speed, the loss can be avoided by bypassing the soft starter using external contactors. Many new soft starters already have internal bypass contactors.

Know the regulations

Three-phase electric motors must comply with Minimum Energy Performance Standards (MEPS). Find out more about these requirements and how to meet them in New Zealand.

How to comply with the regulations
Heat recovery is especially cost effective if you use both heating and cooling systems, such as in food processing. It can increase process heat and refrigeration capacity, avoiding capital investment in new systems.
The most common sources of waste heat in business are:
boiler exhaust
refrigeration systems
air compressors
hot wastewater streams
other hot gas discharges
heat from your heated product(s) output.

Is heat recovery an option?

The hotter the waste heat stream is compared to its surroundings, the easier it will be to re-use it. Recovered heat must ideally be hotter than the temperature you need it to be at the point of use for direct recovery (heat exchanger). To decide if it’s practical and economic, also consider:

the type of waste heat stream. It’s more cost-effective to recover heat from a liquid stream than a gas stream

the availability of heat. Ideally, there would be a good match between when your waste heat is available and when you need it. Otherwise, you need to store it (for example, in a hot water tank)

how far the waste heat needs to travel impacts piping costs

effects on the original process and capacity of heat systems

cost of energy substituted

capital costs of the heat recovery system.

If the waste heat stream is at a lower temperature than you need, it can still be recovered using:

Pre-heating — The temperature might not be enough to do all the heating work, but a lot of energy can still be saved by using heat for pre-heating, then finishing the work with another energy source.

Heat pumps — If the amount of waste heat is large enough, you can use a high temperature heat pump to produce high-grade heat up to 90°C (high temperature) from low-grade heat (lower temperature).

Explore opportunities

There are multiple heat-recovery opportunities within the manufacturing process. Methods such as Process Integration and Pinch Analysis can be used to help identify these opportunities.

Webinar: Process integration and pinch analysis(external link)
Process heat is the steam, hot water or hot gases used in industrial processing, manufacturing and space heating. Businesses can improve their energy efficiency and reduce costs by running boilers and process heat systems efficiently or switching to innovative new heating technology.

Maintaining your process heating system
Check the air-fuel ratio — Too little air results in a smoky flame, which means not all the fuel is burned properly. Too much also leads to losses — the excess air has to be heated and adds to the hot flue gas going to the atmosphere.
Check heating patterns — In gas and liquid fuel-fired direct process heating systems, observing the flame pattern can show up blocked jets and the formation of hot spots. Both these inefficiencies can be easily remedied with cleaning or adjustment of the jets.
Check equipment condition — Inspect the elements of processes heated by direct electrical resistance heating. As the elements age, they can gain resistance due to deterioration of the element surface.

Optimise your process heating system

Insulate the process — This can be done internally with ceramic and/or externally with a fibre insulation layer, depending on your process. Insulation reduces both convective and radiative losses by reducing the wall temperature.

Minimise conductive losses through support structures — Examples of this might be conveyor frames or piping. Because heat is conducted along metal components, some energy efficiency gains can be achieved by insulating the fixtures immediately around the heated space or by introducing a thermal break where practical.

Minimise air infiltration — A combustion system creates negative pressure within the furnace as the exhaust gases move out through the flue. While this stops combustion gases escaping, ambient air may be able to infiltrate the furnace through leaks and openings. Control this with regular inspection and a pressure control system.

Pre-heat combustion air

Combustion air is low temperature, so can be pre-heated by virtually any waste heat stream. If there's an opportunity to pre-heat combustion air, you can increase your boiler efficiency.

Heat recovery opportunities

Look for hot waste streams exiting your system — it could be flue gas, air, water or even steam. For example, an air compressor may reject a lot of heat into the air that can easily be used to pre-heat water. Outlet air from a tunnel dryer can be partially recirculated and used to pre-heat inlet air through an exchanger before being used in another part of the process.

Assess if it is a significant enough amount, and what temperature it is. Investigate whether it could pre-heat any entering streams. Temperature match is key — you can address timing differences with storage.

Electro-technologies

Technology would have evolved significantly during the lifetime of your existing process heat asset. For example, some food products historically sterilised with heat can now be processed through high hydraulic pressure systems that are much more energy efficient and powered by New Zealand’s lower carbon electricity.

A wide range of electro-technologies can meet heating requirements, bringing production co-benefits. For example, heating your product directly, rather than heating the air around it is much more energy efficient.

Opportunities with fuel switching

Switching from a coal or gas-fired process heat system is one of the most impactful ways a business can utilise New Zealand’s renewable energy. Investigate whether electric or bioenergy options would work for you. Electric heat pump technology has made tremendous progress, making them a valid option for most applications using heat below 100°C.

Additional resources and innovations

International technology scan

Electro-technology factsheet [PDF 467 KB]

Process Heat Best Practice Guide [PDF 870 KB]
Pumps and fans operate in a similar way. Pumps are used to move liquids and fans are used to move air, but they both follow the principals of fluid dynamics. So, what works for one generally works for the other — and when either is worn out or incorrectly sized, it wastes energy.

Optimising your pump or fan system
- Level control — In some pump systems, you can set levels so they operate only when necessary.
- Pressure switch control — If your system has intermittent demand, you can install a pressure switch control to turn it off when not needed.
- Right-size — A pump or fan that’s the wrong size for the system can waste a lot of energy. Some systems change over time, making well-specified systems inefficient.
- Remove unnecessary circulation — Isolating loops that unnecessarily circulate heating or cooling water or air, reduce power consumption and thermal load.
- Trim or replace the impeller — If flow and pressure requirements reduce over time.
- Install a variable speed drive — If the pump or fan needs to cover a large range of flow rates.
- Reduce unnecessary airflow — Moving air when you don’t need to wastes energy. Close dampers to isolate air extraction and supply ducts when they’re not needed.
When to replace a pump or fan

Aging systems become a reliability risk — they also become inefficient as wear and corrosion take their toll. Monitor noise, vibration, heat and performance for indications of when it’s time to replace the system.

Prepare in advance to replace the old system. The longer you leave it, the more energy is wasted.
Optimising your steam and hot water systems can significantly improve thermal efficiency, reduce energy losses, and enhance overall system performance.

Optimise your steam and hot water system
- Reduce demand — Look for opportunities where steam is being wasted or overused.
- Check temperatures and pressures — Make sure they’re appropriate for the end use — the lower they are, the lower the losses.
- Spread the load — If you can keep the load at or near optimal setting point, you’ll get better efficiency.
- Minimise distribution losses — Check if there are remote end users that could be better serviced by a small and dedicated heat source.
- Look for heat storage opportunities — This can help to spread the load and improve efficiency.
- Use energy efficient end-user equipment — Every unit of energy you save is a win.
Opportunities with temperature
- Make sure the temperature of the transfer fluid is appropriate to the end use and demand. The lower the temperature, the lower the energy losses.
- Heating at temperatures below 100°C can be achieved with heat pumps, which are much more energy efficient and low carbon than boilers. They’re also more economic, providing they are correctly sized.
- If only a subset of your energy end use requires a higher temperature, servicing it with dedicated heat production may improve the overall efficiency of your process.
Heat recovery opportunities

Look for hot waste streams exiting from your system. Flue gas, air, water or even steam can be reused if there is enough volume at the right temperature. Think about whether waste heat could be used to pre-heat any entering streams. Temperature match is key. You can address differences in timing with storage.

Options for distributed or centralised systems

You can either generate heat in one central location and distribute it to all the end uses or generate heat with several smaller systems located close to where the heat is needed.

These factors will have a bearing on which option is best for your business:
location of heat end uses — whether they’re in one building or many
how far the heat needs to be distributed — longer distances mean greater thermal losses
how much heat you need at each location
the space available to locate distributed boilers
the load profile during the day/season for each end-user
needs and opportunities to install thermal storage tanks.

Additional resources

Technical Guide: Steam Efficiency — a systematic approach to reducing energy wastage [PDF 1.7 MB]

Additional resources

Find the right expert 

Always seek advice from a qualified technician that holds any relevant certifications. This helps ensure your system is safe, compliant, and running at peak efficiency.

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Support and co-funding

Learn about the programmes and co-funding available to help businesses use energy more efficiently.

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Energy saving technology
Investing in modern, high-performance systems for your business — from heating and cooling systems to refrigeration — can reduce costs and improve reliability.

Read more
- Heating and cooling
  Key tips for running your heating and cooling system efficiently, and considerations for installing new systems or upgrades.
- Water heating
  Get tips for running your water heating system efficiently, and learn about efficient systems like hot water heat pumps, which can cut water heating costs by up to 75%.
- Refrigeration
  Refrigeration systems are one of the biggest energy users for many businesses. Learn ways to reduce these energy costs.
- Lighting
  Learn how clever design and technology could shrink your business's lighting costs by up to 90%.
- Building management systems
  Consider a building management system (BMS) to monitor energy use and temperatures, and switch off equipment when it's not needed.
- Efficient on-site equipment
  Information on key on site equipment upgrade areas for businesses, and how well-planned upgrades can help improve your business energy performance long term.

Smarter equipment reduces energy costs

On this page

Improve energy efficiency through replacements

Why upgrade your technology?

Big ticket upgrades worth investigating

Efficient heating and cooling for the workplace

Efficient refrigeration for the workplace

Upgrade your technology

On site equipment opportunities

Additional resources

Find the right expert

Support and co-funding

Find the right expert 