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Comparing the future of the German and UK heating markets

Earlier this year, 70 specialists from Europe's leading heating industry and utility companies joined a webinar to discuss the future of the German and UK heating markets. ( To access the slide set for this webinar, or to download the recording, click here and scroll down) .

To a backdrop of a transforming European home energy market (read more on the challenge for utilities here), we addressed two fundamental questions using the Pathways Tool and Roadmap Service (Germany & UK editions):

1.       How do the German and UK heating markets compare today? 

2.       How will the two heating markets change to 2025?

Q1. How do the German and UK heating markets compare today?

While Germany and the UK are similar in terms of being two of Europe’s largest heating markets and in the dominant role gas boilers play within each market – this is where the similarity ends.

Annual sales of heating appliances in the UK and German markets, broken down by gas boilers, oil boilers, electric heating and low carbon technologies
























In Germany, there is already a relatively high penetration of low carbon heating appliance sales – around 20% of annual sales (130,000 units).  And there is a broad range of appliances being adopted – air source heat pumps (ASHP), ground source heat pumps (GSHP), biomass and ‘gas boiler plus solar thermal’ share the majority of these sales.

A key driver for this is policy (building regulations and the EEWärmeG), which is forcing the adoption of lower carbon heating solutions in newly built properties (ASHPs or biomass boilers are now the standard solution for new build homes without a gas connection). Other drivers include the high residential energy prices resulting in high energy bills and the fact that German homeowners have higher awareness and willingness to pay for low carbon heating systems.

In the UK, the story is very different with much more emphasis on ‘low cost’ heating solutions.  Despite having a heating market that’s more than double the size of Germany’s, the penetration of low carbon technologies is much lower.  Higher cost, low carbon technologies are usually only adopted by the UK’s wealthy innovators with the result that only 2% of annual heating appliance sales can be classed as ‘low carbon’.

The range of technologies adopted is also more limited than in Germany.  ASHPs dominate annual sales, driven primarily by building regulations forcing adoption in new builds (especially in social housing), and by the promise of the renewable heat incentive.

Q2. How will the two heating markets change to 2025?


SHARES OF ANNUAL HEATING APPLIANCE SALES IN GERMANY & THE UK TO 2025





















By 2025, we expect the share of low carbon appliances to grow to around 40% in Germany, with conventional appliance sales falling by around 130,000 units per year. Gas boilers will take the biggest hit. And a number of technologies will be competing for a share of these sales. We have identified five key technologies that will dominate this growth.

In the UK, we also see significant growth but from a much lower starting point. By 2025, we expect low carbon technologies to account for just under a third of annual heating appliance sales – around 400,000 units per year. Much of this will be low carbon gas technologies (hybrids, micro-CHP, gas heat pumps) or electric technologies, displacing gas boiler replacements. In the UK, we also see oil boiler sales almost disappearing by 2025 – being displaced mainly by electric technologies or by low carbon, high efficiency oil appliances.

To access the slide set for this webinar, or to download the recording, click here.

How similar is this story in other European markets?

The movement of European heating markets away from conventional heating systems is uniform – but the differences between markets is unique and varied.

Next in this webinar series, we compare the Dutch and French heating markets, and ask how these two major markets evolve differently out to 2025. To register an interest in this webinar, please email info@delta-ee.com. Places are limited.




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5 years in the making – now it’s over to the industry to make the Domestic Renewable Heat Incentive work!

Today (Wednesday 9th April 2014) the low carbon heating industry in the UK breathed a collective sigh of relief as five years of waiting finally ended, and the ground-breaking domestic renewable heat incentive (RHI) scheme is officially launched.

Will Customers Go For It?

Delta-ee’s recent customer research with rural on and off-gas home owners reveals that the RHI scheme has high appeal for many customers. However, the research also shows there are a number of potential barriers that could reduce uptake. These include:
  • Costs and bureaucracy associated with the link to Green Deal Assessments (which make the customer journey longer and more complex).
  • A continued lack of awareness of low carbon technologies among both customers and installers.
  • Customer fear of moving from old familiar technology to new “unproven” technology.
This makes a market boom unlikely: we will see evolution, not revolution. The industry will have to work hard to make it a success – particularly to educate installers and customers, and to reassure customers that heat pumps, biomass and solar thermal are not ‘high risk’ technologies. Selected quotes from our customer research include:


Despite these potential barriers however, Delta-ee is positive about market prospects:

How Is The Industry Likely To Respond?


Many of the major players welcome the introduction of the scheme, which has benefits for customers, installers and the supply chain, while helping the UK meet its long term carbon reduction targets.

Some manufacturers have (or will) introduce new products into the UK market to allow customers in many different types of home, both on-gas and off-gas, to benefit from the scheme.

Selected reactions from leading industry players include:
  • David Lacey, Commercial Director Heating and Renewables at Daikin UK
  • John Kellett, General Manager of Heating Systems at Mitsubishi
  • Jim Moore, Managing Director Vaillant Group UK & Ireland
  • Andrew Clough, nPower
Read the full press release here.

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There is at least one good thing about the DRIS and that is - it is better than nothing. It is not surprising that the industry we... Read More
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