Converting a Gas Rooftop Unit to a Heat Pump: What to Evaluate Before Deciding

The inspection report leaves little room for doubt: the rooftop unit heating half the store is seventeen years old, its heat exchanger is showing signs of fatigue, and replacement is now a matter of months rather than years. Until recently, the decision would have been simple: you replace a gas rooftop unit with another gas rooftop unit, the way it has always been done.

But this time, the manager hesitates. His contractor is talking about heat pumps designed for cold climates. His board is asking for an emissions reduction plan. And he has heard that financial assistance programs exist for heating electrification. Should he convert now, wait, or choose a middle path?

That question is now being asked across a large part of Quebec's commercial building stock, where natural gas heating (rooftop units, make-up air units, unit heaters) is still widespread. And since the decision window usually opens when the equipment comes up for replacement, it is far better to have thought it through before the breakdown.

A replacement decision, not an ideological one

Let's frame the debate properly. Converting a gas-fired unit to a heat pump is neither an obvious move nor a heresy: it is an investment decision, specific to each building.

Two neighbouring buildings with similar equipment can reach opposite conclusions: because their electrical service differs, because their occupancy schedules differ, or because one has equipment at the end of its service life and the other does not. That is precisely why the question deserves a structured analysis rather than a ready-made answer.

The right reflex is to compare scenarios: keep the gas, convert fully to a heat pump, or opt for a dual-energy system that combines both. Each scenario has a capital cost, an operating cost, a risk profile and an emissions impact. The decision is made by putting those scenarios side by side, with a payback calculation specific to the building.

Quebec's climate: what heat pumps can do, and where they need help

The first objection is always the same: "a heat pump doesn't work at -25 °C." That statement was largely true a generation of equipment ago; today it deserves nuance.

So-called cold-climate heat pumps have improved considerably and can deliver useful heat at markedly lower temperatures than before. But two physical realities remain. First, a heat pump's heating capacity drops as the outdoor temperature falls, exactly when the building needs it most. Second, its efficiency also declines in deep cold.

In practice, this means that in Quebec, as in other very cold climates, backup heat is often needed to cover the coldest days of the year. That backup can be electric or, in a dual-energy scenario, provided by the gas equipment that is kept in place. Sizing the heat pump and its backup is an engineering exercise in its own right: a heat pump oversized to cover the worst day of the year is expensive and performs poorly the rest of the time; an undersized one pushes too much load onto the backup.

So the right question is not "does it work in winter?" but "what share of my annual heating needs can the heat pump cover efficiently, and what covers the rest?"

Energy costs: a less simple comparison than it looks

In Quebec, as in other very cold climates, comparing gas and electricity is not just a matter of comparing a unit price: rate structures, fixed charges and, above all, demand charges come into play. In Quebec, for example, natural gas is distributed mainly by Energir and electricity by Hydro-Quebec.

That last point is where quick analyses most often go wrong. A commercial customer pays not only for the energy it consumes, but also for the maximum power it draws. Replacing gas heating with electric heating, heat pump and backup included, increases the building's electrical demand, precisely during cold periods. If the electric backup kicks in at the same time as everything else in the building, the peak can climb sharply, with a direct effect on the bill.

A serious analysis therefore has to simulate consumption and demand hour by hour over a representative weather year, not just add up averages. This is often where the gap opens between a full conversion scenario and a dual-energy one: the latter can switch to gas during peaks, protecting the electricity bill while still electrifying the majority of heating hours.

The electrical service: the factor that can change everything

Before even talking about savings, a purely technical question can disqualify, or delay, a conversion scenario: does the building's electrical service have the capacity to take on the new load?

A building heated with gas since construction often has an electrical service sized accordingly. Adding heat pumps and electric backup can require upgrading the service, the distribution panel, or even the utility connection. Those works carry costs and lead times that must be included in the payback calculation for the conversion scenario.

This is also a frequent argument for dual-energy: by keeping gas as the backup, the additional electrical capacity required is limited, which can make conversion possible without touching the electrical service. Conversely, if an electrical upgrade is already planned for other reasons (charging stations, an expansion), full conversion can become more attractive than it looked in isolation.

Equipment age: the time to decide is before the failure

Timing is decisive. Converting a gas rooftop unit that is still in good health means walking away from years of useful life already paid for, which weighs down the scenario's payback. Conversely, waiting for the failure to decide almost always leads to a like-for-like replacement, because a store with no heat in January does not have the luxury of studying scenarios.

The most favourable situation is equipment at the end of its service life but still running: replacement is imminent anyway, and only the conversion premium (equipment cost difference, electrical work, roof modifications) has to be justified by savings and incentives. That is the window where scenario analysis delivers the most value, and why it should be run a year or two before the expected end of life, not at the moment of the breakdown.

For a portfolio of several buildings, this argues for a planning exercise: inventory the gas-fired equipment, its age and condition, then set a conversion priority order based on the replacement windows ahead.

Emissions, reputation and assistance programs

The emissions benefit of a conversion depends first on where the regional grid's electricity comes from: the cleaner the grid, the more replacing natural gas combustion with a heat pump reduces the greenhouse gas emissions attributable to heating the building. In Quebec, where electricity comes overwhelmingly from renewable sources, the gain is substantial. For organizations with reduction targets, disclosure obligations, or simply tenants and customers who care about the issue, this weighs in the balance, even if it does not show up directly in the payback.

In addition, financial assistance programs exist to support conversions to more efficient systems and heating electrification, from both energy distributors and governments. Look into the programs available in your region and check the terms in effect at the time of your project: eligibility conditions, qualifying equipment and amounts change regularly, and an available incentive can meaningfully change a scenario's payback.

Three scenarios to put side by side

Let's sum up the approach. For a gas rooftop unit reaching the end of its service life, three scenarios deserve to be quantified:

Keep the gas: replace the unit with a more efficient gas-fired one. Usually the lowest capital cost and no electrical constraints, but emissions remain, along with exposure to future gas prices and regulation.
Convert fully: replace with a cold-climate heat pump and electric backup. Maximum emissions reduction, but a capital premium, a mandatory electrical service check, and a winter peak impact that must be assessed carefully.
Dual-energy: heat pump for the majority of heating hours, gas kept for deep cold and peak periods. A compromise that cuts gas consumption sharply while limiting electrical work and the impact on demand charges.

None of these scenarios is right in the absolute. The right one is the one whose payback, risk profile and emissions impact match the owner's priorities, and that can only be determined with the building's own data.

How a platform like Optima can help

Running this comparison by hand is demanding: it means modelling heating needs hour by hour, accounting for how heat pumps actually behave at low temperatures, simulating the backup, estimating the effect on demand charges and calculating a payback for each scenario. A decision-support platform like Optima helps structure the exercise: the scenarios (keep the gas, convert, dual-energy) are built on the same basis and compared with the same criteria, giving the manager a defensible case for management or a board, rather than an intuition.

Conclusion

Converting a gas rooftop unit to a heat pump is neither a reflex to adopt nor a trend to ignore. It is an investment decision that depends on climate, energy costs, the electrical service, equipment age and the organization's objectives: all factors specific to each building.

The worst way to make it is in the urgency of a breakdown. The best is to use the window before the equipment reaches the end of its service life to seriously compare three scenarios, with a payback calculated for each. That is what makes the decision, whichever it is, a solid one.

Key takeaways

The question arises at replacement time: anticipating the equipment's end of life avoids deciding under pressure.
Cold-climate heat pumps cover a large share of annual heating needs, but backup heat often remains necessary for the deepest cold.
The gas-versus-electricity comparison must include demand charges and the winter peak, not just the price of energy consumed.
The state of the electrical service can disqualify, delay or, on the contrary, favour a conversion scenario.
Dual-energy is often the compromise that electrifies most heating hours while protecting the peak and limiting electrical work.
Financial assistance programs exist; check the terms in effect, because they directly influence the payback.
The decision is made by comparing quantified scenarios specific to the building, not by applying general rules.

FAQ

Can a heat pump really heat a commercial building through a Quebec winter? Cold-climate heat pumps deliver useful heat at much lower temperatures than earlier generations. Their capacity still drops with outdoor temperature, however, which is why backup heat is often needed for the coldest days.

Should I wait for the existing rooftop unit to reach end of life before converting? In most cases, yes: converting equipment that is still healthy weighs down the payback. The ideal is to analyze the scenarios a year or two before the expected end of service life, so the decision is made under good conditions.

What is a dual-energy system, concretely? A configuration where the heat pump provides heating most of the time, and the gas equipment takes over during deep cold or peak periods. Most heating hours are electrified while limiting the impact on the electricity bill.

Why does the winter peak matter so much in the analysis? Because a commercial customer also pays for the maximum power it draws. Electrified heating running at full power during deep cold can push the peak up and erode the expected savings.

Is my electrical service sufficient for a conversion? That must be verified by a professional before any decision. A building designed for gas heating often has a service sized accordingly, and an upgrade can represent significant cost and lead time.

Does conversion really reduce greenhouse gas emissions? In Quebec, where electricity comes overwhelmingly from renewable sources, replacing natural gas combustion with a heat pump substantially reduces the emissions attributable to heating.

Are there incentives for this type of project? Financial assistance programs exist, from both energy distributors and governments, for energy efficiency and heating electrification. Conditions and amounts change over time: check the terms in effect at the time of your project.

Does the same thinking apply to make-up air units? Yes. Gas-fired make-up air units belong to the same equipment portfolios and follow the same analysis logic, with particular attention to fresh air flows, which weigh heavily in the heating load.

How do I compare the three scenarios objectively? By quantifying them on the same basis: consumption and demand simulated hour by hour over a representative weather year, capital costs including electrical work, applicable incentives, and a payback calculated for each scenario.

What about a portfolio of several buildings? Inventory the gas-fired equipment, its age and condition, then prioritize the analyses according to the upcoming replacement windows. This spreads the conversions out and takes advantage of each planned replacement.

References: ASHRAE guidance on heating systems and cold-climate heat pump performance; Natural Resources Canada guides on cold-climate heat pumps; public documentation from Hydro-Quebec and Energir on offers for commercial customers.