GLOBAL HEAT PUMP INDUSTRY INSIGHTS
The global heat pump market was valued at $57.21 billion in 2019 and is expected to reach $92.43 billion by 2025, growing at a CAGR of 8.32% during 2020-2025. The industry will grow more than 1.6X times in terms of revenue during the forecast period. The heat pumps 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 market's downfall in 2020 due 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 use 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 the heat pump during the period 2020–2025.
- The air source segment is expected to reach 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 pumps market is likely to register a CAGR of close to 7%, 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 a promising CAGR of close to 11% during the period 2019–2025 due to the popularity of sustainable policies, the rise in urbanization, and increased disposable income growth in the middle-class economy.
GLOBAL HEAT PUMP MARKET SEGMENTATION
This global heat pumps research report includes a detailed segmentation by
- Product type
- Power source
GLOBAL HEAT PUMP MARKET INSIGHTS BY PRODUCT TYPE
Air source heat pumps was the dominant segment in 2019 and constituted over 70% of the total heat pumps market share. The major factor driving the heat pump installation 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 a ductless pump in renovation projects. As most air source heat pump systems are designed to accommodate and run through the energies obtained from solar or wind energy, the product is considered an ideal choice for achieving 100% sustainability for the welfare of the environment. The segment constitutes air-to-air and air-to-water heat pumps, which are likely to scale new heights in revenue during the forecast period.
Geothermal or ground source heat pumping (GSHP) systems are the most sustainable 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 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 heat pumps market because of the extensive usage of heat pumping machines in the residential segment. Majority of homes under 3,500 sq. ft consider these heat pumping machines 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 as major countries because 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 segment's forecast period.
Heat pumping machines 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 global heat pump market in 2019 and is expected to remain significant during the forecast period. The rise in disposable income, the increased awareness of geothermal energies, HVAC systems utilizing renewable resources, awareness of sustainability, and eco-friendliness are expected to drive the heat pumps 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% of 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 pumping machines that match with the building infrastructure and reduces energy bills has contributed to the segment's growth. Institutions and corporate offices also utilize renewable technology to signify or differentiate themselves from society by showcasing their level of commitment toward the environment and reducing the carbon footprint. Restaurants, hospitals, hotels, offices, fitness centers, shopping malls, and recreation centers are the segment's major end-users.
INSIGHTS BY GEOGRAPHY
APAC was the largest heat pump market 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 unit shipments. The growth is expected from India, Indonesia, Malaysia, and Thailand, where low product awareness and high installation cost are major challenges for adoption. To reduce CO2 emissions by 26% in 2030 and 80% by 2050, the heat pump market 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 heating pumps that can perform well in specific climatic conditions.
Further lifestyle, demography, and weather conditions also favor the growth of the country's heat pump market. The successful implementation of air-to-water heat pumps in large commercial spaces such as Australia has encouraged the adoption of high-capacity devices above 10 kW. Heating pumps have also replaced most conventional boilers in the country, thereby contributing to the market's overall revenue.
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 expand 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 stay competitive.
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
- The Middle East & Africa
- South Africa
- Saudi Arabia