The “Global Heat Pump Market, by Type (Air-water Heat Pump, Air-air Water Pump, Ground Source Heat Pump, and Hybrid Heat Pump), by Power Source (Electric and Others (Gas Driven)), by End User (Residential, Industrial, and Commercial), by Refrigerants (HFC, CO2, Ammonia, Hydrocarbon, and Others), and by Geography (North America, Europe, Asia Pacific, and Latin America, Middle East & Africa) - Global Forecast to 2027”, is expected to be valued at US$ 13,990.4 million by 2027, witnessing a CAGR of 7.4% during the forecast period (2019-2027), as highlighted in a report published by Coherent Market Insights.
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. On the basis of product, the global heat pump market is segmented into ground source heat pump (GSHP), air-air heat pump (AAHP), hybrid heat pump, and air-water heat pump (AWHP). On the basis of end user, the market is segmented into commercial, residential, and industrial sector.
The global heat pump market is estimated to account for US$ 7,920.1 Mn in terms of value by the end of 2019.
Low costs concerning operations and maintenance are expected to drive growth the global heat pump market during the forecast pump
Heat pumps require low operation and maintenance cost, which is the major factor boosting its demand. According to Coherent Market Insights’ analysis, heat pumps can reduce electricity consumption for heating and cooling applications by around 50% as compared to electric resistance heating. Moreover, it uses 75% of renewable energy, which in turn minimizes operational cost for heat pumps. Heat pumps also require very minimal maintenance, which increases its adoption. Furthermore, heat pumps have an average lifespan of around 15-20 years. Therefore, these factors are expected to drive the market growth in the near future.
Positive outlook towards the use of geothermal energy from consumers is expected to pose lucrative growth opportunity
A geothermal heat pump or ground source heat pump offers central heating/cooling system to users. In this, ground source heat pumps use heat absorbed in the Earth’s surface from solar energy. Geothermal heat pumps are boost efficiency and minimize operational cost of heating and cooling system. Furthermore, it can be combined with solar heating to form a geosolar system with greater efficiency. Growing acceptance of geothermal energy among consumers is expected to boost the demand for heat pumps in the near future. This, in turn, is expected to offer significant growth opportunity for market players during the forecast period.
High cost required for installation is expected to hinder the global heat pump market growth over the forecast period
The cost of installing heat pumps is substantially high, which includes cost of heat pump, cost of groundwork, installation cost, and cost of ancillary items such as hot water cylinder, manifolds, and buffer tank. Moreover, cost-sensitivity in emerging economies such as South Africa, Poland, India, and Brazil is expected to hamper the demand for heat pumps and thereby restrict the market growth in the near future.
Growing demand for heat pumps for residential application
According to American Housing Survey (AHS), in 2015, around 12% of homes in the U.S. were equipped with heat pumps. The U.S. heat pumps market is registered constant growth in the recent past due to rapid installations in new homes. It is expected that residential application of heat pumps is expected to increase in the near future, especially in Southern U.S. and is expected to gain significant traction in new regions such as Mid-Atlantic and Northwest region.
Air-to-water heat pumps to witness significant demand in Poland
Air-to-water heat pumps have gained significant traction in the Poland heat pump market. This is owing to significant shift in perspective of air-to-water heat pumps among Polish consumers. Moreover, air-to-water heat pumps are extensively used for domestic hot water due to their high cost-effectiveness and relatively high efficiency compared to conventional heating systems. This trend is expected to continue over the forecast period.
According to government of India’s Draft National Policy on Geo-Thermal Energy, the government provides around 80% depreciation for installation of heat pumps during the first year of installation to support geothermal projects in the country. Moreover, the Ministry of New & Renewable Energy has proposed to the Finance Ministry for revenues ruling in terms of import, excise relaxation & tax benefits on equipment and machinery required for initial setting up of geothermal heating & cooling projects, including geothermal heat pumps and geothermal power generation projects. Furthermore, according to the government of Australia, households across Australia that install a small scale renewable energy system (wind, solar, or hydro) or qualified heat water system are expected to receive benefits under Small-scale Renewable Energy Scheme (SRES) to help with the purchase cost.
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.