Germany’s hydronic heat pump market has seen a couple of excellent years. Following growth rates of 18% in both 2016 and 2017 the market grew by another 8% in 2018, an increase of 51% over 2015. But is that party coming to an end? Many indicators are pointing in this direction.

Recap: A market both driven and held back by subsidies & regulations

Two factors drove the German heat pump market in the last three years: a change to the building regulations taking effect in 2016 as well as a change in subsidies in 2015. This combination created the perfect storm for heat pumps. But the success may be built on thin ice, as subsidy applications equivalent to 50-80% of all installations were made in 2017.

There is a strong potential future for hydrogen as a means to decarbonise heat, according to the reports published by the UK’s Committee on Climate Change (CCC) on 22nd November. Hydrogen is painted as one of the three key solutions (alongside electrification and improved energy efficiency) which will help the UK both decarbonise heat and create more energy system flexibility. This supports Delta-ee’s view that the best route to decarbonisation of heating is likely to be a ‘balanced transition’ across a mix of technologies and fuels.

As our Gas Heating Service highlighted recently, the UK is already one the most active countries in Europe regarding the development of hydrogen for heating: see projects including H21, Hy4Heat, HyNet, HyDeploy and H100. This latest report by the CCC only strengthens the argument that hydrogen could play a key role in heat, as well as in other sectors like transport and industrial processes.

The introduction of hybrid heat pumps (hybrids) across Europe has progressed a lot more slowly than we thought it would when we first looked at them around 2012.

Essentially, the technology has not received the anticipated push from equipment manufacturers – remaining a portfolio product for most. And, despite generating very good carbon savings against alternatives, they rarely offer customers enough energy bill savings to justify their higher upfront cost (or encourage installers to push them).

The Internet of Things (IoT) and the refrigerant of the future were top of the agenda on our recent visit to Chillventa 2018 in Nuremberg.

#1: The “Internet of Things” (IoT) was a buzz phrase this year on HVAC-R company stands – was there substance behind the slogan?

For many European countries, heat pumps are seen as an important enabler in the decarbonisation of the domestic heating stock. New build regulations are increasingly supportive, helping heat pumps gain a foothold in new build markets.

Why are we not seeing more growth in heat pump sales in the retrofit market?

The Stiebel Eltron Group has announced its acquisition of Thermia Heat Pumps (previously known as Danfoss Värmepumpar AB), the heat pump arm of Danfoss A/S, for an unspecified amount.

Thermia is the third largest supplier of HPs in the Nordic heat pump market, making up between 13 and 21% of hydronic heat pump sales in Denmark, Finland, Norway and Sweden, worth 68 million euro per year.