The future of commercial buildings will be defined by smarter systems and on-site energy generation, according to Trane Technologies Chair and CEO David Regnery.
Speaking during the company’s first-quarter earnings call, Regnery said behind-the-meter power — already gaining traction in data centers — is expected to become a universal feature across all building types.
“We … have a philosophy that it will happen in all buildings,” Regnery said. “Behind-the-meter needs are not only in data centers…. Long term, we [also] believe all buildings will be smarter and more resilient…. That is part of our future growth projections because most buildings waste about 30% of the energy they pay for.”
While data centers remain a primary driver of demand for advanced energy and cooling systems, Trane sees broader adoption across sectors including higher education, healthcare and government facilities.
The company reported $5 billion in revenue for the first quarter of 2026, supported by strong performance in its Americas commercial HVAC segment. Applied commercial HVAC bookings in the region surged more than 160%, while enterprise organic bookings rose nearly 70%. Backlog in the segment increased 40%, reflecting sustained demand.
“Our America’s commercial HVAC business is executing at a very high level, significantly outperforming end markets,” Regnery said.
Data centers are playing a key role in that growth, particularly as operators prioritize reliability and continuous uptime, which require advanced cooling systems and integrated service contracts.
“Complex applied systems [like data centers] require the [original equipment manufacturer] to be connected,” said Christopher Kuehn, chief financial officer. “They require the OEM to provide service and maintenance, and the last thing a data center wants is to ever have a fault or go down.”
Trane is also expanding its capabilities through strategic acquisitions, including its recent purchase of Stellar Energy Americas, which designs modular chiller systems for data centers. The business currently holds a $1 billion backlog and is expected to expand into other building sectors.
Regnery said modular systems could help address ongoing labor shortages by reducing installation complexity.
“Skilled labor scarcity is not unique to the data center vertical — it applies to all of our verticals — and we know this is a great solution to help alleviate some of those shortages,” he said.
The company’s domestic manufacturing footprint — including 20 U.S.-based facilities — also provides a competitive advantage, allowing it to manage supply chain challenges, tariffs and material cost fluctuations more effectively.
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“Localized manufacturing [gives us] advantages amid cost pressures,” Regnery said. “We expect to mitigate tariff and inflationary pressures through our business operating system.”
Despite expectations of rising raw material costs, the company said it does not anticipate significant changes to its pricing strategy in 2026.
Looking ahead, Trane is working closely with hyperscalers and semiconductor companies to develop next-generation cooling systems aligned with evolving data center technologies.
“The data center vertical keeps moving with innovation, and we keep pushing and developing that innovation,” Regnery said.
As demand for energy efficiency and resilience grows, the company expects behind-the-meter power systems and intelligent building technologies to become standard features across the built environment.
Originally reported by Robert Freedman, Lead Editor in Facilities Dive.
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