The global heat pump market size by revenues will cross over USD 92 billion by 2025, growing at a CAGR of 8% during the forecast period. The industry will grow more than 1.6X times in terms of revenue during the forecast period. The market witnessed reasonable growth in 2019, where over 50% of the contribution came from established markets such as China, the US, and Japan. The global heat pump market will witness sudden traction in demand in 2021 after the downfall of the market in 2020 owing to the COVID-19 pandemic. The market growth was sluggish in Q1 and Q2 of 2020 due to the complete disruption in the supply chain. The majority of manufacturers operated with limited resources and a workforce that highly affected the market.
The district heating concept, which is increasingly favored in recent times, is expected to make the use of heat pumps as a major source. Heat is also likely to be generated from geothermal and biomass solutions. Rebate systems in several European countries have played a significant role in large-scale adoption. The growth of green buildings and strong building conduct codes are other supporting factors that can stimulate the growth of heat pumps during the period 2020–2025.
- The air source segment is expected to reach a revenue of over $66 billion by 2025 due to the increased adoption in India, Malaysia, Thailand, and Singapore, with China leading from the front.
- In terms of unit shipment, the U.S. heat pump market is likely to register a CAGR of close to 7%, which is driven by stringent government regulations and the rise in green buildings.
- The residential segment is projected to observe an incremental growth of over $21 billion by 2025 because of increased disposable incomes and high awareness of geothermal energy sources.
- The heat pump market size in India is likely to grow at the promising CAGR of close to 11% during the period 2019–2025 due to the popularity of sustainable policies, the rise in urbanization, and increased higher disposable incomes with growth in the middle-class economy.
GLOBAL HEAT PUMP MARKET SEGMENTATION
This research report includes a detailed segmentation by
- Product type
- Power source
INSIGHTS BY PRODUCT TYPE
Air source heat pumps were the dominant segment in 2019 and constituted over 70% of the total market share. The major factor driving the installation of these pumps is high-energy efficiency, which is proven to save a minimum of 3,000 kWh per year than other conventional methods. Another major factor driving growth is the increasing adoption of ductless pumps in renovation projects. As the majority of air source heat pumps are designed to accommodate and run through the energies obtained from solar or wind energy, the product is considered as an ideal choice for achieving 100% sustainability for the welfare of the environment. The segment constitutes air-to-air and air-to-water pumps, which are likely to scale new heights in revenue during the forecast period.
Geothermal or ground source heat pumps (GSHP) are proven to be the most sustainable method for heating and cooling mechanisms in the market. With energy output suitable for all types of applications, they are increasingly installed in residential, commercial, and industrial sectors. The segment is increasing in demand as GSHPs ensure the durability and can perform effectively in all seasons. These products work under any weather conditions, with high-energy efficiency and electricity savings, wide application scope expecting to drive the GSHP segment in the coming years.
INSIGHTS BY CAPACITY
The less than 10 kW segment dominates the market on account of the extensive usage of heat pumps in the residential segment. Majority of homes under 3,500 sq. ft consider these heat pumps as ideal with affordable cost and installation. APAC is the fastest-growing region for the segment owing to the concentration of underpenetrated and growing economies. North America is also expected to ship 3.35million units of
The 10–20 kW segment by revenue is expected to pose an absolute growth of 62% during the forecast period. In terms of shipment, Europe and North America are likely to grow at promising CAGRs during the forecast period. China, the US, and GCC countries are likely to emerge major countries on account of increased commercial construction activities. The increased preference for high-capacity heat pumps for space cooling in hot and humid regions of the Middle East & Africa is expected to generate high revenue during the forecast period for the segment.
Heat pumps that are greater than 20 kW are extensively used in industries for high-grade drying, process cooling activities, which is expected to drive the growth during the forecast period. Owing to the high concentration of industrial activities, APAC and North America are likely to contribute significantly to the market growth. The segment is expected to generate incremental revenue of close to $5 billion during the forecast period.
INSIGHTS BY END-USER
The residential end-user segment dominated the market in 2019 and is expected to remain significant during the forecast period. The rise in disposable income, the increased awareness of geothermal energies, the use of HVAC systems utilizing renewable resources, awareness of sustainability, and eco-friendliness are expected to drive the market in the residential sector. With established markets in Europe, North America, and a few major countries in the APAC region, the residential segment constitutes more than 65% for the less than 10 kW heat pump market.
The commercial segment was the second-largest end-user in 2019, which accounted for over 23% of the total revenue share. The development of affordable and flexible heat pumps that match with the building infrastructure and reduces energy bills have contributed to the growth of the segment. Institutions and corporate offices also utilize renewable technology to signify or differentiate themselves from society by showcasing their level of commitments toward the environment and reducing the carbon footprint. Restaurants, hospitals, hotels, offices, fitness centers, shopping malls, and recreation centers are the major end-users in the segment.
INSIGHTS BY GEOGRAPHY
APAC was the largest market for heat pumps in 2019, with China being the largest market contributing over 21% to the global revenue share. Japan closely follows China, which is expected to pose an absolute growth of 67% in terms of unit shipments. The growth is expected from India, Indonesia, Malaysia, and Thailand, where low product awareness and high cost of installation are major challenges for adoption. To reduce CO2 emissions by 26% in 2030 and 80% by 2050, the market for heat pumps is well developed in Japan, where lower GWP refrigerants are always preferred. While the temperature in the country ranges between -2 and 32 Celsius, vendors can design heat pumps that can accordingly perform well in specific climatic conditions.
Further lifestyle, demography, and weather conditions are also favoring the growth of the heat pumps market in the country. The successful implementation of air-to-water heat pumps in large commercial spaces such as Australia has encouraged the adoption of high-capacity devices that are above 10 kW. Heat pumps have also replaced most conventional boilers in the country, thereby contributing to the overall revenue of the market.
INSIGHTS BY VENDORS
The global heat pump market share is fragmented as it is characterized by the presence of a significant number of global and domestic heat pump manufacturers across geographies. Global players such as Carrier, Rheem Manufacturing, Midea, Daikin, and Trane are expanding their markets through profitable partnerships and merger strategies. Domestic vendors are capitalizing on the product portfolio that best suits domestic needs. However, being a technology-oriented product, the scope of differentiation lies with sophistication and deployment of advanced features such as energy efficiency, COP, eco-friendly refrigerant, installation costs, and services that help vendors to stay competitive in the market.
The global heat pump market research report includes in-depth coverage of the industry analysis with revenue and forecast insights for the following segments:
By Product Type
- Air Source
- Water Source
- Ground Source
- Less than 10 KW (<10kW)
- Greater than 20 KW (>20kW)
- North America
- South Korea
- Latin America
- Middle East & Africa
- South Africa
- Saudi Arabia