December 1, 2023

Residential Segment is the largest segment driving the growth of Heat Pump Market

The global Heat Pump Market is estimated to be valued at US$ 10674.44 Mn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Heat pumps are energy efficient devices that transfer heat from a source to its intended place using a refrigeration cycle. They are widely used for space heating and cooling solutions in residential and commercial buildings. The benefits of using heat pumps include reduced energy costs and lower carbon emissions.

Market key trends:

One of the major trends driving the growth of heat pump market is the stringent government policies and initiatives to promote renewable energy and energy efficient technologies. Many countries globally have introduced subsidies, tax rebates and investment incentives for adoption of heat pumps to meet their domestic carbon emissions targets under the Paris Agreement. For instance, the European Union through its new Ecodesign Directive is aiming to phase out conventional boilers and promote adoption of heat pumps. This is expected to significantly boost the sales of heat pumps across Europe in the coming years.

Market key trends:

The global heat pump market is witnessing increased adoption of geothermal heat pumps. Geothermal heat pumps utilize constant underground temperature to heat homes and businesses in winters and cool them in summers. This technology is more efficient than air source heat pumps as the underground temperatures remain at a more stable temperature compared to air temperatures. Furthermore, awareness regarding energy-efficiency and reduced carbon emissions have boosted the adoption of geothermal heat pumps across various applications such as residential, commercial and industrial.

SWOT Analysis

Strengths: Geothermal heat pumps offer higher efficiency and lower operating costs compared to traditional HVAC systems. They rely on renewable underground heat to provide space cooling and heating.

Weaknesses: High initial installation cost of geothermal heat pumps acts as a barrier. Space requirement for laying pipes underground is also a constraint.

Opportunities: Increasing focus on energy-efficiency and carbon emission reduction are driving demand. Government incentives and subsidies promote wider adoption.

Threats: Volatility in raw material prices can increase the manufacturing cost. Changing climate patterns may affect underground temperature stability in few regions.

Key Takeaways

The Global Heat Pump Market Size was valued at USD 10674.44 Mn in 2023 and is expected to reach over USD 23000 Mn by 2030, expanding at a CAGR of 10% during the forecast period. Rapid urbanization and growing demand for space heating and cooling from residential and commercial sectors are expected to drive the market.

The Asia Pacific heat pump market accounted for over 35% of the global market share in 2023 due to high construction activities and rising living standards in China, India and other developing countries. Government initiatives to popularise energy-efficient technologies boost adoption.

Key players in the heat pump market include Daikin Industries, Viessmann Group, NIBE Group, Danfoss, Stiebel Eltron, Mitsubishi Electric, United Technologies, Panasonic, Glen Dimplex, Bosch. Leading companies focus on product innovation and partnerships to strengthen their foothold. For example, Daikin launched new monobloc heat pumps for homes in 2022 with higher efficiency levels.


  1. Source: Coherent Market Insights, Public sources, Desk research
  2. We have leveraged AI tools to mine information and compile it