Heat Pump Market

Heat Pump Market Outlook (2024 to 2034)

The global heat pumps market size is set to reach a value of US$ 84.6 billion in 2024 and thereafter expand at a remarkable CAGR of 9.1% to end up at US$ 202.2 billion by 2034.

A heat pump, a mechanical refrigeration device, employs a compression cycle to regulate temperatures in a designated area. Due to their versatility, heat pumps are widely used for both heating and cooling purposes, particularly in space heating and cooling systems. Their components include an exterior heat pump unit resembling a central air conditioner and an indoor air handler.

The outdoor unit's compressor circulates refrigerant, which absorbs and releases heat between indoor and outdoor units. A key difference between a heat pump and an air conditioner lies in their capabilities; while both cool spaces using similar principles, heat pumps can also provide heating, a feature lacking in air conditioners.

Heat pump market growth is being driven by factors such as the shift from traditional fuel-based heating to heat pump technology and its affordability in residential settings. Moreover, adoption of heat pump technology aligns with regulations, contributing significantly to reducing CO2 emissions. Market expansion is further propelled by supportive regulatory frameworks and increasing environmental concerns.

Recent developments in the industry reflect ongoing climate fluctuations and subsequent demand increasing for heating and cooling solutions in residential and industrial sectors.

Report Attribute	Detail
Heat Pump Market Size (2024E)	US$ 84.6 Billion
Forecasted Market Value (2034F)	US$ 202.2 Billion
Global Market Growth Rate (2024 to 2034)	9.1% CAGR
Canada Market Growth Rate (2024 to 2034)	9.2% CAGR
China Market Value (2034F)	US$ 27.9 Billion
North America Market Share (2024E)	24.7%
East Asia Market Share (2034F)	28.3%
Key Companies Profiled	Midea Group; Panasonic Corporation; Mitsubishi Electric Corporation; Denso Corporation; LG Electronics; Lennox International; Fujitsu General; Samsung; NIBE Group; Glen Dimplex Group; Flamingo Heat Pumps.

Which Factors are Inflating the Market for Heat Pumps?

“Integration of IoT Technology for Remote Diagnostics and Monitoring”

Heat pumps, integrated with Internet of Things (IoT) technology, offer remote diagnostics, real-time monitoring, and predictive maintenance capabilities. Smart thermostats, interacting with water heating systems, are vital components of IoT-enabled heat pumps. These pumps are gaining traction across various industries.

Despite their increasing popularity, their fundamental designs and functionalities remain unchanged. Automation and remote control features have been prioritized to enhance user experience with next-gen heat pumps. Modern heat pumps are equipped with LCDs and warning indicators for user convenience.

Leading industry competitors like Panasonic and Samsung are focusing on integrating diverse technologies into their heat pumps to ensure ease of operation and maintenance. Research is exploring the incorporation of artificial intelligence (AI) and machine learning (ML) to enhance energy efficiency and reduce power consumption.

“Focus on Efficient Utilization of Ambient Heat to Reduce Fossil Fuel Dependence”

Electricity is the primary power source for houses, hospitals, and schools, among other places. However, significant greenhouse gas emissions occur during both its production and consumption. To curb these emissions, many countries worldwide are increasingly transitioning to renewable energy sources while reducing their dependence on non-renewable ones.

Heat pump technology emerges as a promising solution for reducing greenhouse gas emissions. Heat pumps utilizing geothermal and aerothermal technology offer a low-energy method for space heating. Incorporating heat pumps into HVAC systems is viewed as a sustainable approach.

Heat pumps are widely employed for space heating, cooling, and water heating across commercial, industrial, and residential sectors. Substantial thermal energy reserves are present in both the air and ground.

By utilizing energy input, primarily electricity, heat pumps efficiently raise temperatures after extracting ambient heat from the air, operating at low temperatures. They significantly reduce reliance on fossil fuels compared to other heat transfer methods. This factor drives market expansion by increasing the adoption of heat pump installations across various industries.

What are the Issues Seen in the Market for Heat Pumps?

“Lack of Familiarity with ISO Regulations Among Contractors”

Heat pumps represent highly advanced machinery. End users in developing and underdeveloped countries may lack awareness regarding the energy efficiency, economic viability, and environmental advantages associated with heat pumps, compounded by their limited technical expertise. This lack of awareness is projected to hinder the expansion of the heat pump market size in developing countries during the analysis period.

Research from the United Nations Environment Program indicates that contractors lack familiarity with International Organization for Standardization (ISO) regulations concerning heat pumps. ISO standards significantly contribute to enhancing the safety and quality control of provided goods and services.

“High Cost Associated with Installation of Heat Pumps”

High initial investment and specialized installation process of geothermal heat pumps pose significant constraints despite their efficiency benefits. Because they contribute to decreased carbon emissions, energy costs, and increased energy efficiency, heat pumps are widely employed in the commercial, industrial, and residential sectors.

Since air-source heat pumps are more affordable and effective in providing heating for households and small commercial buildings, there is a great demand for them. Although installing a geothermal heat pump usually costs more, the benefits include increased efficiency and the ability to serve larger buildings. Geothermal heat pumps require the subterranean installation of high-density polyethylene pipes, which requires a team of experts to spend at least three days.

Country-wise Evaluation

The market in South Korea is forecasted to expand at a CAGR of 9% from 2024 to 2034. The country is evaluated to occupy a heat pump market share of 24.9% in East Asia by the end of 2034.

How is Recovery of Construction Sector in United States Driving Market Growth?

“Rising Demand for Renovation Activities and Increasing Adoption of Air-to-Air Heat Pumps”

Attribute	United States
Market Value (2024E)	US$ 17.2 Billion
Growth Rate (2024 to 2034)	9.1% CAGR
Projected Value (2034F)	US$ 41.1 Billion

Swift recovery of the construction sector in the United States, alongside repair and restoration endeavors, is poised to boost the requirement for advanced and space-efficient heating solutions in residential areas. The United States commands a substantial market share owing to its prominence in heating solutions, residential construction, and the growing request for air-to-air heat pumps.

What is Drawing Heat Pump Manufacturers to Japan?

“Extensive Adoption of Efficient Heating Solutions in Residential Construction”

Attribute	Japan
Market Value (2024E)	US$ 6.3 Billion
Growth Rate (2024 to 2034)	9.2% CAGR
Projected Value (2034F)	US$ 15.1 Billion

Expansion of the heat pump market in Japan is being driven by rising demand from the country's residential, commercial, and industrial sectors as well as the dominance of leading heat pump manufacturers. Among the key heat pump market trends seen in Japan is the widespread usage of efficient heating solutions in residential buildings, not only for space heating and cooling but also for refrigerators.

Category-wise Insights

Based on product type, the ground source segment is evaluated to expand at a CAGR of 9.5% from 2024 to 2034.

Why are Air-source Heat Pumps Preferred over Other Variants?

“Versatility and Cost-Effectiveness of Air-Source Heat Pumps”

Attribute	Air Source
Segment Value (2024E)	US$ 57.5 Billion
Growth Rate (2024 to 2034)	9% CAGR
Projected Value (2034F)	US$ 135.7 Billion

An air source heat pump (ASHP) extracts heat from the surrounding air to produce hot water reaching temperatures of up to 90 °C. As heat is drawn from the air, the ambient temperature decreases, fulfilling the dual requirements for cold air and hot water, thereby propelling sales of air-source heat pumps.

Air-source heat pumps are projected to maintain a significant market share during the forecast period compared to water-source and ground-source counterparts. Growing demand for air source heat pumps is stimulated by their versatility and cost-effective installation and capital expenses.

How is Climate Change Influencing Adoption of Heat Pumps in Residential Settings?

“Incentives for Energy-efficient Heating and Cooling Solutions in Residential Settings”

Attribute	Residential
Segment Value (2024E)	US$ 52.9 Billion
Growth Rate (2024 to 2034)	9.1% CAGR
Projected Value (2034F)	US$ 126.6 Billion

Urgency of climate change is boosting the adoption of heat pumps, offering cooling during hot periods and heating in colder seasons. Heat pumps, known for their energy efficiency, serve as vital appliances in homes, providing hot water for sanitation and regulating indoor temperatures. The principal factors bolstering market growth in the residential segment include increased governmental funding for infrastructure initiatives and incentives promoting the adoption of renewable energy sources, especially in developing countries.

Market Rivalry

Key players in the heat pump market are implementing a range of marketing techniques, including partnerships, cooperation, mergers and acquisitions, new product releases, regional growth, and alliances, to gauge potential customers' interest and grow their clientele, and also adapting themselves to the evolving market trends such as geothermal heat pumps and oil & gas pumps.

• On May 3, 2024, Rheinmetall received more orders for its ground-breaking heat pump technology, which will be utilized in off-road vehicles and electric buses.
• A new company called Quilt launched a ductless heat pump in May 2024, revolutionizing the industry.
• To move Europe off gas and expedite the electrification of residential heating, Swedish sustainable energy technology company Aira introduced the Aira Heat Pump in March 2024.

Fact.MR provides detailed information about the price points of key heat pump manufacturers positioned across the world, sales growth, production capacity, and speculative technological expansion, in this updated market report.

Key Segments of Heat Pump Market Research

• By Product Type :

  • Air Source
  • Water Source
  • Ground Source

• By Rated Capacity :

  • Up to 10 kW
  • 10 to 20 kW
  • 20 to 30 kW
  • Above 30 kW

• By Application :

  • Residential
  • Commercial
  • Industrial

• By Region :

  • North America
  • Latin America
  • Eastern Europe
  • Western Europe
  • East Asia
  • South Asia & Pacific
  • Middle East & Africa