Europe Heat Pump Market Size - By Product (Air Source, Ground Source, Water Source), By Application (Residential, Commercial) & Global Forecast, 2024 - 2032

Europe Heat Pump Market Size

Europe Heat Pump Market size valued at USD 17.1 billion in 2023 and is set to grow at a CAGR of 18% between 2024 and 2032. Europe industry growth is owing to the increasing demand for efficient apace heating technologies along with the accelerating development across buildings infrastructure. The increasing demand for energy-efficient units in the residential and commercial sectors, combined with the ongoing replacement of existing heating systems to reduce carbon emissions. The global market size of heat pump is poised to reach USD 165.2 billion by 2032.
 

Furthermore, significant variation in the climatic conditions across several geographies attributed by the elevating pollution and global warming levels along with accelerating demand for advanced technologies in the heat pump systems have led to augment the product deployment across the region.
 

A heat pump is an electrical device that moves heat from one location to another through the circulating refrigerants experiencing compression, evaporation, and condensation. The systems are a part of building Heating, Ventilation, and Air Conditioning (HVAC) solutions and are designed to serve the heating & cooling requirements with minimal environmental impact.

COVID- 19 Impact

The COVID-19 pandemic had a modestly negative impact on the Europe heat pump market. Strict government initiatives to curb the virus spread including stringent lockdown protocols and shutdown of industrial operations has significantly disrupted the construction sector hindering the product deployment across new facilities. In addition, limited cross-border trade practices amid the pandemic along with fluctuations in the availability of raw materials have negatively impacted the industry growth prospects.

However, a gradual rise in infrastructure development backed by the upliftment of lockdown protocols coupled with increasing government efforts to promote energy-efficient buildings will create lucrative opportunities for the industry growth. Furthermore, several administrations have set positive targets to promote the low pollution ‘green wave' through adoption of low carbon technologies will cater to the industry expansion.

Europe Heat Pump Market Trends

Rapid technological innovations by key companies, shifting consumer preferences, presence of favorable financial incentive programs, and growing measures to diminish the overall carbon footprint are some of the key imperatives propelling the Europe heat pump industry landscape. The industry is poised for transformation on account of the significant advancements in various heat pump technologies coupled with the rising demand for energy-efficient & eco-friendly heating and cooling solutions.

For instance, in June 2022, Daikin Europe introduced a new series of air to water heat pump systems called Daikin Altherma 3 M in small capacities of 4, 6, and 8 kW to cater to small capacity requirements. These new product line utilize R-32 refrigerant and employ a monobloc design, which simplifies installation and operation. Moreover, rapid increase in demand for low carbon space heating & cooling systems and technologies, driven by ambitious heat pump deployment targets and initiatives have created a positive industry outlook.

Europe Heat Pump Market Analysis

Europe air source heat pump segment is set to witness remarkable growth through 2032, owing to rising inclination toward reliable, user-friendly, and efficient space heating systems along with increasing demand for ambient temperatures across residential and commercial establishments. The ability of these units to offer various benefits including low maintenance requirements, compact size, low deployment cost, and flexible installation will further accelerate the product demand.

For instance, in June 2022, Trane unveiled the expansion of its versatile air-source heat pumps units with R-454B refrigerant. The new range is equipped with 4 Sintesis Balance CMAF tubes to deliver efficient heating & cooling with an operating capacity ranging between 150 kW to 1,400 kW. Furthermore, regulators are focusing exclusively towards replacing conventional heating systems with clean and sustainable heating solutions including heat pumps which will complement the regional air source heat pump industry landscape.
 

The residential heat pump segment of Europe heat pump market will observe a growth rate of over 18% till 2032, owing to the increasing urban population coupled with stringent government mandates for energy conservation. The improved living standards and the growing demand for compact and efficient heating technologies will also contribute to augment the product demand. These units are widely adopted across various temperatures and processes, offering ambient heating and temperature control.

This versatility and adaptability will further boost the deployment of heat pump systems in residential applications, meeting the diverse heating needs of homeowners while promoting energy efficiency and sustainability. Introduction of beneficial programmes by the respective governments including incentives and tax benefits encouraging the low emission systems integration across households, further bolstering the product adoption.

Europe heat pump market from commercial heat pump segment is expected to experience significant growth during the forecast period, on account of changing climatic conditions, along with the implementation of stringent building energy codes by regulatory authorities and countries. The rapidly expanding service sector has also played a crucial role in the increased penetration of heat pumps in commercial complexes and establishments. Different verticals within the commercial sector, such as colleges/universities, offices, and government/military services, drive the demand for heat in commercial applications.

The flourishing economic structures and government initiatives aimed at raising investments in the service sector industry will have a positive influence on the market growth. In addition, the rising living standards and disposable income of individuals, along with a growing demand for efficient space heating and hot water in both domestic and commercial structures, will further drive the deployment of heat pump systems.
 

The Germany heat pump market size was reached USD 1.6 billion in 2022, driven by various factors, including the development of commercial and residential infrastructure and favorable economic conditions across the nation. The government's support through introduction of favorable policies and financial plans, including financial aids, subsidies, and tax benefits, has further encouraged the deployment of heat pumps.

For instance, In January 2023, the German government adjusted its rebate program to promote the use of sustainable heating, including heat pumps that utilize natural refrigerants. The revised regulations offer a basic subsidy rate of 25% and can cover up to 40% of the expenses associated with purchasing and installing heat pumps. Moreover, the government initiatives to promote green building infrastructure along with stern focus on reducing carbon emissions from building stock will boost the national industry dynamics. The market for heat pump in the U.S. is slated to exceed USD 29.6 billion by 2032.

Europe Heat Pump Market Share

Key manufacturers operating in the Europe heat pump market consist of

• Trane
• Viessmann
• Bosch Thermotechnology Ltd.
• Panasonic Corporation
• STIEBEL ELTRON GmbH & Co. KG
• Gree Electric Appliances, Inc.
• SAMSUNG
• NIBE Industrier AB
• Mitsubishi Electric Corporation
• DAIKIN INDUSTRIES, Ltd.
• LG Electronics
• Finn Geotherm UK Limited
• A. O. Smith
• Carrier
• Lochinvar
• Swegon Group AB
• TOSHIBA
• Glen Dimplex Group
• Kensa Heat Pumps
• WOLF GmbH
• Vaillant Group
   

Major companies operating across the Europe heat pump industry are focusing on building strategic collaborations and partnerships to introduce new technologies coupled with accelerating investments and manufacturing capacities to strengthen their industry presence over the others.
 

Europe Heat Pump Industry News

• In March 2023, Panasonic revealed its accelerated growth strategy for the hydronic systems and air-to-water heat pump business in Europe. As part of this initiative, the company announced a significant investment of over USD 600 million. Out of this amount, more than USD 376 million will be dedicated to strengthening the heat pump business, while USD 113 million will be allocated for acquiring Systemair's AC business. To support this strategy, Panasonic will further invest USD 113 million into its manufacturing facility in the Czech Republic. This investment aims to enhance the production capacity specifically for air-to-water heat pumps. By expanding their manufacturing capabilities, Panasonic is positioning itself for growth and market leadership in the European air-to-water heat pump market.
   
• In January 2023, During the ISH 2023 trade fair, Daikin Europe N.V. unveiled its upcoming Altherma 4 series of air-to-water heat pump systems. This new series serves as the successor to the highly acclaimed Altherma 3 series, which set a new benchmark for heat pumps in the industry. Alongside the product launch, the company introduced a comprehensive European-wide program designed to support and guide installers. The program aims to provide proper and high-quality training to ensure smooth operation of the installed units throughout their lifespan. The commercial availability of the Daikin Altherma 4 series is scheduled to begin in 2024.

   

This Europe heat pump market research report includes in-depth coverage of the industry with estimates & forecast in terms of “’000 Units” & “USD Million” from 2019 to 2032 for the following segments:

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Market, By Product

• Air source
  • By Application
    • Residential
    • Commercial
• Ground source
  • By Application
    • Residential
    • Commercial
• Water source
  • By Application
    • Residential
    • Commercial

Market, By Application

• Residential
• Commercial

The above information has been provided for the following countries:

• Europe
  • Austria
  • Norway
  • Denmark
  • Finland
  • France
  • Germany
  • Italy
  • Switzerland
  • Spain
  • Sweden
  • UK
  • Netherlands