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Market Overview

A heat pump is a device used for cooling and heating by extracting heat from lower heat sources and deliver it to higher potential for water, space, and floor heating/cooling. Technically air conditioner and refrigerator are two prime examples where heat pump is used. Refrigerator and air conditioner work only on cooling cycle, whereas heat pumps can operate on fully reversible cooling cycle. Condenser, evaporator, expansion valve, and compressor are some of the common examples of heat pump. The heat transferred through these components is called refrigerant. Moreover, heat pumps are increasingly used in domestic hot water for kitchen, bathroom, and clothes washer.

The global heat pump market is estimated to account for US$ 7,920.1 Mn in terms of value by the end of 2019.

Market Dynamics- Drivers

  1. Growing urbanization and complementary regulatory policies are expected to drive growth of the global heat pump market during the forecast period

Significant growth of construction industry combined with growing implementation of strict regulatory policies by governments, especially in China, South Korea, Japan, and the U.S. are expected to boost the demand for heat pumps for residential application. Moreover, subsidies on purchase of heat pumps provided by the government, tax credit schemes and increasing use of energy are expected to boost the market. Countries such as the U.S., Australia, Japan, and European offer subsidies purchase for heat pumps, in order to reduce carbon footprint and increase use of renewable energy for heating and cooling purpose. For instance, the European Union has adopted renewable energy policy, which includes contribution of heat pumps to the EU target of reaching 20% of renewable energy share by 2020. In 2016, the U.K. Government adopted a ‘Zero Carbon’ policy for new homes. Moreover, In Europe, the government provides subsidies for purchase of heat pumps and has implemented several stringent new building regulations such as mandatory use of renewable energy for heating purpose in new buildings. Thus, these factors are expected to boost the market growth during the forecast period.

  1. Increasing demand for eco-friendly and technologically advanced devices are expected to propel the global heat pump market growth over the forecast period

Increasing demand for eco-friendly and technologically advanced devices in heating and cooling applications is expected to boost the demand for heat pumps. Growing demand for eco-friendly devices worldwide is directly proportional to the global heat pumps demand, as heat pumps are very useful in reducing CO2 emission. It uses only ¼ electrical energy and ¾ environmental energy. Thus, such factors are expected to propel the market growth in the near future.

Europe region dominated the global heat pump market in 2018, accounting for 43.7% share in terms of value, followed by Asia Pacific, North America, Latin America, and MEA, respectively.

Heat Pump  | Coherent Market Insights

Source: Coherent Market Insights

Market Dynamics- Restraints

  1. High installation cost is expected to restrain growth of the global heat pump market over the forecast period

Heat pump requires significant cost for installation, which in turn, is expected to hinder its demand in the near future. The total cost installation includes cost of heat pumps, installation cost, cost of groundwork for ground source heat pumps and cost of ancillary items (buffer tank, manifolds, hot water cylinder). For instance, if per unit cost of heat pump for 11kW capacity is US$ 1,000–US$ 2,000, the cost increases by 25%–30% when installation cost is included. Furthermore, cost-sensitivity is a major issue in emerging economies such as India, Brazil, South Africa, and Poland, which is major factor hindering its adoption.

  1. Lack of awareness concerning benefits heat pumps in emerging economies is expected to hinder the global heat pump market growth over the forecast period

Low awareness regarding benefits and advantages of heat pumps in emerging economies such as Brazil, India, and South Africa is a major factor hindering adoption of heat pumps. Moreover, poor consumer awareness of ground source heat pumps in regions such as APEJ, Latin America and MEA is factor hampering growth of the global heat pumps market. Therefore, these factors are expected hinder the overall growth of the market.

Market Opportunities

  1. Growing demand for CO2 refrigerant heat pumps is expected to offer lucrative growth opportunities for market players

CO2 refrigerant heat pumps offer significant growth opportunity for heat pumps manufacturers.CO2 refrigerant heat pumps are eco-friendly, low cost, and offer easy recyclability. Moreover, CO2 heat pumps are widely preferred in Europe and Japan due to excellent qualities offered such as zero ozone depletion and low global warming potential. CO2 refrigerant pumps find applications in air-source heat pumps, since it has lower installation cost than ground source heat pumps for residential water heating application.

  1. High demand for heat pumps from emerging economies is expected to present significant growth opportunity

Heat pumps have witnessed significant demand from emerging market, especially APEJ countries such as India, China, Philippines, Indonesia, and Malaysia. Eco-friendly heat pumps are also expected to witness lucrative demand from these countries in the near future, which in turn, is expected to pose significant growth opportunity for market players during the forecast period. In India, South Korea, Brazil, South Africa and ASEAN countries, heat pumps are used in industrial or commercial sectors and to a small extent in residential sector, therefore market penetration for heat pumps in these countries is low. This provides opportunities for heat pumps suppliers to optimize their profit margins.

Heat Pump  | Coherent Market Insights

Source: Coherent Market Insights

Global air-air heat pump based market was valued at US$ 3,257.6 Mn market in 2018 and is forecast to reach a value of US$ 5,554.2 Mn by 2027 at a CAGR of 6.0% between 2017 and 2027. 

Market Trends

  1. Hybrid pumps are expected to witness significant demand in the near future

End users around the world are preferring hybrid heat pump for various industry segments. These pumps are a combination of air source heat pumps and gas boiler/solar heaters. These pumps are gaining significant demand across the globe, especially in Europe. Key players operating in the market are Daikin, Bosch Thermotechnik GmbH, Vaillant, Viessmann, Dimplex, and Ariston provide hybrid heat pumps. Hybrid pumps offer numerous benefits such as switching automatically two heating methods namely electricity or gas boiler heaters, depending upon the prevalent weather conditions. Moreover, In APEJ hybrid heat pumps gaining more traction owing to its substantial cost savings and energy efficiency for domestic water heating purpose. China is the largest market for hybrid heat pumps.

  1. Growing inclination towards use of eco-friendly refrigerants

Heat pumps that use natural refrigerants have gained significant traction in the market. Natural refrigerants such as carbon dioxide R744), ammonia (R717) and hydrocarbon are being increasingly preferred due to their environment-friendly properties. Moreover, aforementioned refrigerants are increasingly replacing hydroflurocarbon (HFC), owing to low global warming potential and no adverse effects on ozone layer. Moreover, CO2 refrigerant heat pumps demand in Japan is expected to increase during the forecast period, owing to increasing use of these pumps.

Regulations

North America

According to the U.S. Department of Energy, residential central air conditioners and central air conditioning heat pumps manufactured and distributed in commerce, as defined by 42 U.S.C. 6291(16), must meet the energy conservation standards specified in the Code of Federal Regulations at CFR 430.32(c)(3). Furthermore, according to the Energy Improvement and Extension Act of 2008, customers using and installing geothermal heat pumps and small wind energy systems are entitled for tax credit. However, the systems must be placed in service on or after January 01, 2008 and on or before December 31, 2016. Moreover, according to the Air Conditioning, Heating, and Refrigeration Institute, the federal government offers tax credits for some residential HVAC systems and products, and deduction for energy savings in commercial buildings. According to Current 25D law, which expires on December 31, 2016, a taxpayer may claim credit of 30% of total investment for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer. Expenditures include labor costs for on-site groundwork, assembly or original system installation, and for piping or wiring to interconnect a system to the home.

Value Chain Analysis

Heat Pump  | Coherent Market Insights

Competitive Section

Key players operating in the global heat pump market are Daikin Industries Limited, Viessmann Group, NIBE Group, Danfoss Group Global, Stiebel Eltron Group, Mitsubishi Electric Corporation, United Technologies Corporation, Panasonic Corporation, Glen Dimplex Group, and The Bosch Group.

Key Developments

  1. Key players in the market are focused product launch, in order to gain competitive edge in the market. For instance, in January 2019, Daikin Industries Limited showcased its advanced and commercial HVAC equipment for providing superior air to consumers.
  2. Major market players are involved in product launch, in order to enhance their product portfolio. For instance, in February 2019, Viessmenn introduced two new air source heat pumps namely Vitocal 222-A and Vitocal 200-A.

A heat pump is a mechanical device that transmits thermal energy from a source to a thermal reservoir. Heat pumps transfer heat energy in the opposite direction of spontaneous heat transfer by absorbing heat from cold space and releasing it a warmer one. Refrigerator and air conditioner are the most commonly known heat pumps. Refrigerator and air conditioner work only on cooling cycle, whereas heat pumps can operate on fully reversible cooling cycle. Increasing demand for eco-friendly and technologically advanced devices in heating and cooling applications is expected to boost the demand for heat pumps. Growing demand for eco-friendly devices worldwide is directly proportional to the global heat pumps demand, as heat pumps are very useful in reducing CO2 emission.

Market Dynamics

Heat pumps require low operation and maintenance cost, which is the major factor boosting its demand. Moreover, growing demand for heat pumps for residential application and significant contribution of heat pump technology in reducing carbon emissions is a major factor that is expected to boost the growth of heat pump market globally. Significant growth of construction industry combined with growing implementation of strict regulatory policies by governments, especially in China, South Korea, Japan, and the U.S. are expected to boost the demand for heat pumps for residential application. Moreover, subsidies on purchase of heat pumps provided by the government, tax credit schemes and increasing use of energy are expected to boost the market.

However, high cost required for installation is one of the restraining factors that is expected to hamper the growth of the global heat pump market.

Market Taxonomy

This report segments the global heat pump market on the basis of type, power source, end user, and refrigerants. On the basis of type, the global heat pump market is segmented into air-water heat pump, air-air heat pump, ground source heat pump, and hybrid heat pump. On the basis of power source, the market is segmented into electric and others (Gas Driven). On the basis of end user, the market is segmented into residential, industrial, and commercial. On the basis of refrigerants, the global heat pump market is segmented into HFC, CO2, ammonia, hydrocarbon, and others.

Key features of the study:

  • This report provides an in-depth analysis of the global heat pump market and provides market size (Thousand Units and US$ Million) and Compound Annual Growth Rate (CAGR %) for the forecast period (2019 – 2027), considering 2018 as the base year
  • It elucidates potential revenue opportunities across different segments and explains attractive investment proposition matrix for this market
  • This study also provides key insights about market drivers, restraints, opportunities, new product launches or approval, regional outlook, and competitive strategy adopted by leading players
  • It profiles leading players in the global heat pump market based on the following parameters – regulatory landscape, company overview, financial performance, product portfolio, geographical presence, distribution strategies, key developments and strategies, and future plans
  • Key companies covered as a part of this study include Daikin Industries Limited, Viessmann Group, NIBE Group, Danfoss Group Global, Stiebel Eltron Group, Mitsubishi Electric Corporation, United Technologies Corporation, Panasonic Corporation, Glen Dimplex Group, and The Bosch Group.
  • Insights from this report would allow marketers and management authorities of companies to make informed decision regarding future product launches, technology up-gradation, market expansion, and marketing tactics
  • The global heat pump market report caters to various stakeholders in this industry including investors, suppliers, distributors, new entrants, and financial analysts
  • Stakeholders would have ease in decision-making through the various strategy matrices used in analyzing the global heat pump market

Detailed Segmentation:

  •  Global Heat pump Market, By Type
    • Air-water Heat Pump
    • Air-air Heat Pump
    • Ground Source Heat Pump
    • Hybrid Heat Pump
  •  Global Heat pump Market, By Power Source:
    • Electric
    • Others (Gas Driven)
  •  Global Heat pump Market, By End User:
    • Residential
    • Industrial
    • Commercial
  • Global Heat pump Market, By Refrigerants:
    • HFC
    • CO2
    • Ammonia
    • Hydrocarbon
    • Others
  • Company Profiles
    • Daikin Industries Limited *
      • Company Overview
      • Product Portfolio
      • Financial Performance
      • Key Strategies
      • Recent Developments
      • Future Plans
    • Viessmann Group
    • NIBE Group
    • Danfoss Group Global
    • Stiebel Eltron Group
    • Mitsubishi Electric Corporation
    • United Technologies Corporation
    • Panasonic Corporation
    • Glen Dimplex Group
    • The Bosch Group

*Browse all the market data tables and figures on "Global Heat pump Market - Forecast to 2027”

Table of Contents

  1. Research Objective and Assumption
    • Research Objectives
    • Assumptions
    • Abbreviations
  2. Market Purview
    • Report Description
      • Market Definition and Scope
    • Executive Summary
      • Market Snippet, By Type
      • Market Snippet, By Power Source
      • Market Snippet, By End User
      • Market Snippet, By Refrigerants
  • Market Snippet, By Region
    • Coherent Opportunity Map (COM)
  1. Market Dynamics, Regulations, and Trends Analysis
    • Market Dynamics
      • Drivers
      • Restraints
      • Market Opportunities
      • Regulatory Scenario
      • Industry Trend
      • Merger and Acquisitions
      • New Product Launch/Approvals
      • Value Chain Analysis
      • Porter’s Analysis
      • PEST Analysis
  2. Global Heat Pump Market, By Type, 2017-2027  (Thousand Units & US$ Million)
    • Introduction
      • Market Share Analysis, 2017 and 2027 (%)
      • Segment Trends
    • Air-Water Heat Pump
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Air-Air Heat Pump
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
      • Segment Trends
    • Ground Source Heat Pump
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Hybrid Heat Pump
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
  3. Global Heat Pump Market, By Power Source, 2017-2027  (Thousand Units & US$ Million)
    • Introduction
      • Market Share Analysis, 2017 and 2027 (%)
      • Segment Trends
    • Electric
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Others (Gas Driven)
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
  4. Global Heat Pump Market, By End User, 2017-2027  (Thousand Units & US$ Million)
    • Introduction
      • Market Share Analysis, 2017 and 2027 (%)
      • Segment Trends
    • Residential
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Commercial
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Industrial
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
  5. Global Heat Pump Market, By Refrigerants, 2017-2027  (Thousand Units & US$ Million)
    • Introduction
      • Market Share Analysis, 2017 and 2027 (%)
      • Segment Trends
    • HFC
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • CO2
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Ammonia
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Hydrocarbon
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
    • Others
      • Introduction
      • Market Size and Forecast, 2019–2027, (Thousand Units & US$ Million)
  6. Global Heat Pump Market, By Region, 2017-2027  (Thousand Units & US$ Million)
    • Introduction
      • Market Share Analysis, By Region, 2017 and 2027 (%)
    • North America
      • Regional Trends
      • Market Size and Forecast, By Type, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Power Source, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By End User, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Refrigerants, 2019–2027 (Thousand Units & US$ Million)
      • Market Share Analysis, By Country, 2019 and 2027 (%)
        • U.S.
        • Canada
    • Europe
      • Regional Trends
      • Market Size and Forecast, By Type, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Power Source, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By End User, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Refrigerants, 2019–2027 (Thousand Units & US$ Million)
      • Market Share Analysis, By Country, 2019 and 2027 (%)
        • U.K.
        • Germany
        • Italy
        • France
        • Russia
        • Rest of Europe
    • Asia Pacific
      • Regional Trends
      • Market Size and Forecast, By Type, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Power Source, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By End User, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Refrigerants, 2019–2027 (Thousand Units & US$ Million)
      • Market Share Analysis, By Country, 2019 and 2027 (%)
        • China
        • India
        • Japan
        • ASEAN
        • Australia
        • South Korea
        • Rest of Asia Pacific
    • Latin America
      • Regional Trends
      • Market Size and Forecast, By Type, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Power Source, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By End User, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Refrigerants, 2019–2027 (Thousand Units & US$ Million)
      • Market Share Analysis, By Country, 2019 and 2027 (%)
        • Brazil
        • Argentina
        • Mexico
        • Rest of Latin America
    • Middle East and Africa
      • Regional Trends
      • Market Size and Forecast, By Type, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Power Source, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By End User, 2019–2027 (Thousand Units & US$ Million)
      • Market Size and Forecast, By Refrigerants, 2019–2027 (Thousand Units & US$ Million)
      • Market Share Analysis, By Country, 2019 and 2027 (%)
        • Israel
        • GCC Countries
        • South Africa
        • Rest of the Middle East and Africa
  7. Competitive Landscape
    • Company Profiles
      • Daikin Industries Limited
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Viessmann Group
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • NIBE Group
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Danfoss Group Global
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Stiebel Eltron Group
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Mitsubishi Electric Corporation
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • United Technologies Corporation
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Panasonic Corporation
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • Glen Dimplex Group
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
      • The Bosch Group
        • Company Overview
        • Product Portfolio
        • Financial Performance
        • Key Strategies
        • Recent Developments/Updates
    • Analyst Views
  8. Section
    • References
    • Research Methodology
    • About us and Sales Contact

*Browse 60 market data tables and 40 figures on "Heat Pump Market - Global forecast to 2027”.

Research Methodology

Coherent Market Insights followsa comprehensive research methodology focused on providing the most precise market analysis. The company leverages a data triangulation model which helps company to gauge the market dynamics and provide accurate estimates. Key components of the research methodologies followed for all our market reports include:

  • Primary Research (Trade Surveys and Experts Interviews)
  • Desk Research
  • Proprietor Data Analytics Model

In addition to this, Coherent Market Insights has access to a wide range of the regional and global reputed paid data bases, which helps the company to figure out the regional and global market trends and dynamics. The company analyses the industry from the 360 Degree Perspective i.e. from the Supply Side and Demand Side which enables us to provide granular details of the entire ecosystem for each study. Finally, a Top-Down approach and Bottom-Up approach is followed to arrive at ultimate research findings.


Data Triangulation Methodology | Coherent Market Insights

Coherent Market Insights desk research is based on a principle set of research techniques:

  • National level desk research: It Includes research analysis of regional players, regional regulatory bodies, regional trade associations, and regional organization.
  • Multinational level desk research: The research team keeps a track of multinational players, global regulatory bodies, global trade associations, and global organization.

Coherent Market Insights has a large amount of in-house repository of industry database. This is leveraged as a burner for initiating a new research study. Key secondary sources include:

  • Governmental bodies, National and international social welfare institutions, and organizations creating economic policies among others.
  • Trade association, National and international media and trade press.
  • Company Annual reports, SEC filings, Corporate Presentations, press release, news, and specification sheet of manufacturers, system integrators, brick and mortar - distributors and retailers, and third party online commerce players.
  • Scientific journals, and other technical magazines and whitepapers.

Market Analysis | Coherent Market Insights

Preliminary Data Mining

The raw data is obtained through the secondary findings, in house repositories, and trade surveys. It is then filtered to ensure that the relevant information including industry dynamics, trends, and outlook is retained for further research process.

Data Standardization

Holistic approach is used to ensure that the granular and uncommon parameters are taken into consideration to ensure accurate results. The information from the paid databases are further combined to the raw data in order to standardize it.

Coherent Statistical model

We arrive at our final research findings through simulation models. Coherent Data Analytics Model is a statistical tool that helps company to forecast market estimates. Few of the parameters considered as a part of the statistical model include:

  • Micro-economic indicators
  • Macro-economic indicators
  • Environmental indicators
  • Socio-political indicators
  • Technology indicators

Data Processing

Once the findings are derived from the statistical model, large volume of data is process to confirm accurate research results. Data analytics and processing tools are adopted to process large chunk of collected informative data. In case, a client customizes the study during the process, the research finding till then are benchmarked, and the process for new research requirement is initiated again.

Data Validation

This is the most crucial stage of the research process. Primary Interviews are conducted to validate the data and analysis. This helps in achieving the following purposes:

  • It provides first-hand information on the market dynamics, outlook, and growth parameters.
  • Industry experts validates the estimates which helps the company to cement the on-going research study.
  • Primary research includes online surveys, face-to face interviews, and telephonic interviews.

The primary research is conducted with the ecosystem players including, but not limited to:

  • Raw Material Suppliers
  • Manufacturers
  • System Integrators
  • Distributors
  • End-users