According to the International Energy Agency (IEA), global sales of heat pumps are “set to soar to record levels” in coming years.
The IEA’s recently released report, The Future of Heat Pumps, attributes strong growth in the heat pump market to falling costs and strong incentives. According to the report, global heat pump sales rose by nearly 15 per cent in 2021, double the average of the past decade, led by a 35 per cent increase in European Union sales.
The IEA predicts 2022 sales will hit record levels in response to the global energy crisis – particularly in Europe, where some countries are seeing sales double in the first half of 2022 compared with the same period last year.
“Annual sales of heat pumps in the EU could rise to 7 million by 2030 – up from 2 million in 2021 – if governments succeed in hitting their emissions reduction and energy security goals,” says the IEA. “Heating buildings accounts for one-third of EU gas demand today.”
According to IEA Executive Director Doctor Fatih Birol, heat pumps are an indispensable part of any plan to cut emissions and natural gas use, and an urgent priority in the EU.
“The technology is tried and tested, even in the coldest of climates,” says Dr Birol. “Policy makers should be putting their weight behind this technology that is witnessing unprecedented momentum at the moment. Heat pumps will be central to efforts to ensure everyone can heat their homes this winter and next, to protect vulnerable households and businesses from high prices, and to meet climate objectives.”
The IEA says government policy support is needed to help consumers overcome the relatively higher upfront costs of heat pumps, which can be two-to-four times more than a gas boiler. According to the report, financial incentives for heat pumps are available in more than 30 countries, which together cover more than 70 per cent of heating demand.
“Many of them also provide additional support to low-income households where energy savings from a heat pump can be significant, ranging between 2–6 per cent of household income,” says the IEA.
The IEA estimates heat pumps have the potential to reduce global carbon dioxide (CO2) emissions by at least 500 million tonnes in 2030 – equal to the annual CO2 emissions of all cars in Europe today.
“Leading manufacturers are seeing promising signs that today’s momentum and policy support could put the industry on a trajectory that triples sales by 2030 – and they have accordingly announced plans to invest more than $4 billion (USD) in expanding heat pump production and related efforts, mostly in Europe.”
The report highlights anticipated challenges, including increasing electricity demand caused by heat pumps, though energy efficiency and improved grid planning may reduce these impacts.
There is also a question about who will install the heat pumps.
“Global heat pump supply and installation could require over 1.3 million workers by 2030, nearly triple the current amount, raising the potential for skilled labour shortages, especially for installers,” says the IEA.
The report predicts that the additional global upfront investment in heat pumps required to reach announced climate pledges will be around US$160 billion (AUD$235 million) annually by 2030.
“All the pieces are in place for the heat pump market to take off, reminiscent of the trajectory we have seen in other key climate technologies like solar PV and electric vehicles,” says Dr Birol. “Heat pumps address many of policy makers’ most pressing concerns on energy affordability, supply security and the climate crisis. Policy measures are in place today, but they need to be reinforced urgently to allow heat pumps fulfil their significant economic and environmental potential.”
The report is available at the IEA website.