HVAC License in Texas: Fees, Requirements & Startup Costs
Quick answer: Texas HVAC contracting is regulated by the Texas Department of Licensing and Regulation (TDLR). An individual Air Conditioning and Refrigeration Contractor license, with the appropriate Class A or B and endorsement, anchors the business. The official application fee is $115 under the TDLR application instructions; the chosen class also has a separately charged exam. City mechanical permits still apply.
Choose class and endorsement before selling work
Texas treats the ACR contractor credential as an individual license. The holder is responsible for the business’s work, so an entity filing alone does not establish contracting authority. Class A covers equipment without the Class B capacity limits. Class B is limited to cooling systems of 25 tons and under and heating systems of 1.5 million BTU per hour and under, as described in the TDLR ACR record. Match the planned equipment to the class before advertising commercial work.
The endorsement also matters. Environmental Air Conditioning, Commercial Refrigeration, and Process Cooling or Heating describe different work. A repair offer that grows into commercial refrigeration should be reviewed against the license endorsement rather than assumed to be covered because the technician can perform the task. Keep a written service list that the license holder approves.
Licensing in Texas
Jurisdiction: state
Authority: Texas Department of Licensing and Regulation (TDLR) - Air Conditioning and Refrigeration Contractors
HVAC contractors are licensed statewide by TDLR as Air Conditioning and Refrigeration (ACR) Contractors (Occ. Code ch. 1302). The ACR contractor license is an individual license; the licensee is responsible for the business's work. Local jurisdictions handle mechanical permits.
Air Conditioning and Refrigeration Contractor (Class A or Class B, with endorsement: Environmental Air Conditioning, Commercial Refrigeration, or Process Cooling or Heating)
INDIVIDUAL Class A: any size unit. Class B: cooling systems 25 tons and under, heating 1.5 million BTU/hr and under. Required to perform/offer ACR contracting; serves as the license the business operates under.
| Fee | Amount | Period (years) |
|---|---|---|
| ACR Contractor license application | $115 OFFICIAL FEE Source — www.tdlr.texas.gov | 1 |
| PSI exam, Environmental Air or Commercial Refrigeration Class A | $74 VERIFIED DATA Source — test-takers.psiexams.com | — |
| PSI exam, Environmental Air or Commercial Refrigeration Class B | $60 VERIFIED DATA Source — test-takers.psiexams.com | — |
| Annual ACR Contractor license renewal | $65 OFFICIAL FEE Source — www.tdlr.texas.gov | 1 |
Exam: Provider: PSI · Source
Experience: At least 48 months of practical ACR experience under a licensed ACR contractor within the past 72 months; or 12 months holding ACR technician certification plus at least 36 months of practical experience within 48 months.
Bond: Applies To: No bond requirement stated on the ACR contractor application page · Source
Insurance: Requirement: Class A: $300,000 per occurrence / $600,000 aggregate / $300,000 products-completed operations · Source
Requirement: Class B: $100,000 per occurrence / $200,000 aggregate / $100,000 products-completed operations · Source
Renewal and CE: Renewal period: 1 year · Continuing education: 8 hours · Source
Local note: Mechanical permits and inspections are handled by cities; requirements vary by city, so check with yours.
Data notes
The Class A exam costs $74 and the Class B exam costs $60, paid directly to PSI under the bulletin effective September 1, 2026.
Verified: 2026-09-24
What the application asks the contractor to prove
The researched application path calls for practical ACR experience under a licensed contractor, with an alternative route for a person who has held ACR technician certification and accumulated the specified practical experience. The applicant then takes the exam for the selected class and endorsement. The PSI bulletin lists different charges for Class A and Class B exams, so a launch budget should use the chosen route rather than combining them.
Texas requires class-specific liability coverage. The application page gives separate occurrence, aggregate, and products-completed operations limits for Class A and Class B. Obtain an insurance certificate that matches the proposed class before expecting the credential to be ready. The researched application page did not state a bond requirement. An applicant with specified criminal-history answers may need an additional questionnaire.
Renewal and local job control
The contractor credential renews annually, with continuing education described in the TDLR renewal guidance. Put renewal and insurance dates on the operating calendar so an accepted job does not outlast the authority to perform it. The license record here does not analyze employee technician registration or certification; verify staffing rules with TDLR as hiring plans become concrete.
Texas cities handle mechanical permits and inspections. Ask the city for each job address which work needs a permit, who must apply, and how inspections are scheduled. A state license does not establish a citywide permit policy. Add permit time and inspection returns to the estimate when replacing equipment or changing a system.
Use the Texas budget preset
A Texas service startup may prioritize diagnostic instruments, refrigerant handling gear, and common replacement parts. Installation work adds equipment ordering, delivery, access, commissioning, and a larger gap between purchases and customer collection. Edit the preset for the actual class, vehicle, coverage quote, and services. The startup guide explains why those choices move the opening budget; the pricing guide connects them to customer charges.
| Cost category | Range | Basis |
|---|---|---|
| Licensing | Varies by state — see license table | Official fees depend on state and structure |
| Business formation | Varies by state — see license table | Official fees depend on state and structure |
| Insurance (first year) | $910–$1,200 MARKET ESTIMATE Source | Selected coverage |
| Vehicle | $0–$48,400 MARKET ESTIMATE Source | Own vehicle to cash purchase |
| Tools & equipment | $10–$5,450 MARKET ESTIMATE Source | Basic to pro priced kit anchors |
| Software (first year) | $590–$6,000 MARKET ESTIMATE Source | Basic to pro annual subscription |
Marketing, payroll, working capital, permits: set in the calculator.
Startup Cost Calculator
Estimated startup cost: $8,350–$10,800
Estimated startup cost: $8,350–$10,800. Break-even at about 7 jobs per month.
| Licensing & exam fees | $175–$189 OFFICIALLicense details |
|---|---|
| Business formation (state filing) | $300 OFFICIAL |
| Insurance (first year) | $910–$1,200 MARKET ESTIMATEGeneral liability |
| Vehicle acquisition | $0 YOUR INPUTYour existing vehicle; acquisition cost $0Vehicle price sources |
| Tools & equipment | $250 MARKET ESTIMATEStarter kit items
|
| Software (first year) | $590–$2,250 MARKET ESTIMATEPublished monthly list price × 12Software price sources
|
| Launch marketing | $1,500 YOUR INPUTYour input — default: 3 months × $500 |
| Payroll reserve | $0 CALCULATEDBLS median wage × 173 hours/month × employees × employer taxes and ECEC benefits × working-capital months |
| Working capital | $4,600–$5,100 CALCULATEDMonthly overhead excluding payroll (shown separately) × working-capital months |
| Permits & compliance | $0 YOUR INPUTYour input — default $0; local requirements may apply |
Monthly overhead: $1,550–$1,700 · Annual operating: $18,400–$20,400 · Break-even: 7 jobs/month
Vehicle operating per month: $760 CALCULATED
Phone and admin per month: $150 YOUR INPUT
Show formula
Startup total is the sum of available first-year cost lines. Monthly overhead includes insurance, software, marketing, vehicle operating, phone and admin, and payroll. Break-even jobs = monthly overhead ÷ (average ticket × gross margin).
For a broader comparison of contractor credentials, read the HVAC license guide. Figures and requirements shown here come from the researched Texas record; city-level charges were not researched.
Official sources
- www.tdlr.texas.gov — ACR Contractor license application
- www.tdlr.texas.gov — Annual ACR Contractor license renewal
- api.bls.gov — BLS OEWS Heating, Air Conditioning, and Refrigeration Mechanics and Installers
- www.sos.state.tx.us — Texas LLC filing fee
Market sources
- test-takers.psiexams.com — PSI exam, Environmental Air or Commercial Refrigeration Class A
- www.insureon.com — Insureon
- www.nextinsurance.com — NEXT
- www.ramtrucks.com — 2026 Ram ProMaster cargo van (base)
- www.cars.com — 2026 Ford F-150 XL (base)
- www.cars.com — 2026 Ford Transit-150 cargo van (base, T-150 130in low roof RWD)
- www.coxautoinc.com — Used vehicle average listing price (all segments, not cargo-van specific)
- trutechtools.com — Fieldpiece SM482V 4-port digital manifold (replaces SM480V)
- www.supplyhouse.com — Fieldpiece SRS1 refrigerant scale
- trutechtools.com — Fieldpiece VP67 6 CFM vacuum pump
- www.fluke.com — Fluke 117 electrician's multimeter
- www.homedepot.com — 3M SecureFit SF400G-LV-4-PS safety glasses
- trutechtools.com — Fieldpiece VP87 8 CFM vacuum pump
- trutechtools.com — Appion G5Twin recovery machine
- trutechtools.com — Fieldpiece MR45 digital recovery machine
- www.supplyhouse.com — Fieldpiece DR82 infrared refrigerant leak detector
- www.getjobber.com — Jobber
- www.housecallpro.com — Housecall Pro
- quickbooks.intuit.com — QuickBooks Online
Frequently asked questions
Is the Texas ACR contractor license issued to the company?
The researched TDLR record identifies an individual contractor license; the holder is responsible for the business's ACR work.
How do Class A and Class B differ?
Class B has cooling and heating equipment-capacity limits; Class A is not subject to those class limits.
Can an Environmental Air Conditioning endorsement cover commercial refrigeration automatically?
The endorsement should be matched to the actual service offer with TDLR before accepting work.
Who issues a mechanical permit for a Texas replacement?
The city with jurisdiction over the job address handles permits and inspections.
Last updated: October 21, 2026