SmartHeat Inc. is a holding company. The Company, through its subsidiaries, designs, manufactures and sells heat pumps in the People's Republic of China. The Company operates through the Heat Pump (HP) segment. Its HP segment subsidiaries produce heat pumps in sizes that have applications primarily in industrial. Its HP subsidiaries design and build specific to customer specifications and particular operating conditions. The Company's products provide a solution to energy consumption and air pollution problems in China. The Company's components generally include pumps, valves, pipes and electronic meters purchased from various international and domestic suppliers. The Company's products are used in the industrial, residential and commercial markets. Its customer base consists of state-owned enterprises diversified across a range of end markets in China. The Company's subsidiaries include Heat HP Inc. and Heat PHE Inc. Its subsidiaries produce heat pumps in Shenyang China.