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Promising policies and revised regulation: the European heat pump market is warming up


It’s been a busy month for the Electrification of Heat Service. We have recently published our latest heat pump country reports focusing on France, Italy and Germany and have already had the chance to discuss some of the findings  at our recent European Heat Summit.

The results of our recent research and the forecasts we’ve made suggest a tentatively positive outlook for the European heat pump market. We have seen growth in some segments of the heat pump market in these three countries, as displayed in the graph below. The arrows show the expected direction of growth over the next few years.


Certain factors have affected the market growth – if stakeholders are able to contribute the effort required to drive the market forward, we could see a sturdier future for the market, more heat pump sales and a stronger heat pump industry.

A mostly positive outlook for France

In France, the outlook for electrically-driven heating is still positive, in spite of less market growth than previously predicted. We expect the total hydronic HP market to continue to grow in 2017 and 2018, but not to reach the rates of previous years.

A supportive policy environment and growing market acceptance will contribute to a significant increase in annual hydronic HP sales between 2017 and 2021, with DHW HPs taking the largest share.

While growth is expected, the low oil price has prevented higher sales, due to its prompting a boom in sales of oil boilers. The sustained low fossil fuel pricing means that there will be little incentive for end-users to replace them with heat pumps before their obsolescence, unless fuel prices start to rise again.  

Italy’s new build sector increases HP market share

Heat pump sales make up a fairly small percentage of heating sales into residential properties in Italy, although the opportunity for growth looks promising. A hot summer in 2015 grew the a/a market significantly and other factors driving growth include the increasing regulation of the new build sector (boosting sales of air/water in particular), the increasing presence of new products (domestic hot water and hybrids), and an improving Italian economy.

Although the majority of sales of new heating appliances in 2016 were still gas boilers, heat pumps are beginning to take an increasing market share, especially in the new build sector where air/water heat pumps are a key technology to help meet regulations.

Germany shows signs of promising growth

We expect the space heating HP market in Germany to continue to grow in the next few years, with steady growth in air/water heat pump sales driven by their success in the new build sector.  

There is growing concern in the market regarding noise from split air/water heat pumps, and technology developments are key to whether split or monobloc models will dominate this market in the future.

As with France, the oil price drop in recent years has prevented the continued growth of the DHW HP market, but on the other hand the space heating market – and in particular the GSHP market – performed well, due to the reform of the MAP incentive in 2015.

Going forward

Although the European heat pump market hasn’t seen any dramatic changes in its progress and market growth remains gradual, the outlook remains positive.

It is now up to those in the industry to take this momentum and build on it, pushing forward heat pump sales and the growth of the industry. This, of course, would be great news for electrically-driven heat and a step towards an increasingly low carbon future.

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