Heat Pump Market
Heat Pump Market Size, Share, Competitive Landscape and Trend Analysis Report by Source, Capacity and End-User: Global Opportunity and Industry Forecast (2025-2030)
Report ID:
1119
Industry:
Energy & Power
Published on:
Dec 2025
Heat Pump Market Summary
Heat Pump Market size was valued at USD 95.1 Bn in 2024 and is expected grows to USD 160.8 Bn by 2030, growing at a CAGR of 9.15% during (2025-2030).
Heat Pump Industry Trends and Analytical Insights -
Asia Pacific Heat Pump Market was the largest revenue generating region market in year 2024, with market share accounted for 45.5%
In 2024, By Source Type, Air Source dominated the Heat Pump Market, accounted for 75% market shares.
Leading Key players for Heat Pump Market in 2024 was Daikin Industries Ltd., Mitsubishi Electric Corporation, Carrier Global Corporation, Bosch Thermotechnology (Robert Bosch GmbH) and Viessmann Group.
Market Size & Forecast
Market Size 2024: USD 95.1 Billion
Projected Market Size 2030: USD 160.8 Billion
CAGR (2024-2030): 9.15%
Asia pacific: Dominated market in 2024
Heat Pump Market Overview
Global Heat Pump Industry in 2024 was greeted for its strong electrification momentum, policy-driven adoption, and replacement of fossil fuel-based heating systems at a fast pace. Air-source heat pumps was the leading choice, accounted over 70% of total installations, as they were favoured by lower upfront costs and simplicity of deployment in Heat Pump Market. The residential sector was by far the largest demand pool with around 60–65% of total volumes coming from it, whereas commercial buildings accounted for almost 25%, which was mainly the result of office, retail, and public infrastructure retrofits. The innovations in inverter-driven compressors, low-GWP refrigerants, and hybrid heat pump systems had significantly increased the efficiency and cold climate performance, thus, more and more people in both mature and emerging markets were choosing to use these technologies.
Globally, the Asia-Pacific Heat Pump Market was setting the pace for the heat pump market with the contributions of nearly 45.5% of the total global demand in 2024. The main area of influence is definitely China, Japan, and South Korea, where air-source units are common in residential and multi-family housing sectors. The European Heat Pump Market accounts for approximately 30% of the global demand and is mainly supported by decarbonization mandates, energy regulations for buildings, and the substitution of gas boilers, mostly in Germany, France, and the Nordics. In North America, the market is limited to about 18-20% with the demand being mainly focussed in the U.S. and Canada, where cold-climate heat pumps and dual-fuel systems are becoming popular. The other regions are still at a developmental stage but are growing steadily.
According to the end-user adoption scenario, the transition of the usage of the product had slow in moving beyond residential heating to different commercial and industrial use cases in 2024. Commercial usages such as hotels, healthcare institutions, and educational buildings contribute nearly one-fourth of the yearly installations, whereas industrial applications make up less than 10% and are mainly focused on low- to medium-temperature process heat. In terms of capacity, systems of up to 10 kW were predominant in the residential sector, whereas 10-20 kW units are increasingly being utilized in small commercial buildings. There were a growing number of discussions about larger systems with more than 20 kW for district heating and industrial retrofits, which was an indication of a structural increase of the market in 2024.
This extensive analysis by Jadhavar Business Intelligence Pvt Ltd provides consumers with a complete and actionable picture of the Global Heat Pump Market, including market size, share, trends, and growth estimates from 2024 to 2030. It provides a complete overview of important locations and countries by Source, Capacity, and End-User. Clients receive comprehensive market dynamics, business tool analysis (PORTER and PESTLE), a Technology roadmap, and regulatory updates. The study also includes country-specific projections, competitive benchmarking, Company profiles, and M&A activity, all of which aid in strategic planning, market entry analysis, and competitor positioning in Heat Pump Industry.
Heat Pump Market Dynamics
In 2024, the Heat Pump Industry was a reflection of the movement towards electric buildings and stricter energy efficiency regulations. In fact, the global average share of residential buildings newly constructed in developed countries that choose heat pumps as their main heating solution exceeds 40%. Subsidies supported by the government continue to be a real game changer for demand giving back 20-35% of the costs of the system installation in the most developed markets. Moreover, the gradual increase in the electricity to gas price differentials has made the operating economics more attractive than before since one can expect heat pumps to provide 3-4 times more energy efficiency than traditional systems. This was a reason why the residential and commercial retrofit projects had become a preferred choice for the heat pumps’ deployment.
Heat Pump Industry was struggled with issues raised by the region's high initial investment and the need for the infrastructure. The expenses of the system installed locally were 25-40% higher than those of the usual heating solutions, thus a limited adoption was observed in markets sensitive to the price. Limitations of the electricity network was became a problem as heat pumps may increase the peak electricity demand by 15-20% in the regions with cold weather during the month of winter. Moreover, the problem of the shortage of skilled installers has maintained for a long time, as the availability of a trained workforce meets less than 70% of the demand in some regions, thus leading to longer installation times and inconsistent system performance.
In 2024, the heat pump market presents significant opportunities driven by large-scale building retrofits and industrial decarbonization initiatives. More than 50% of existing residential and commercial buildings in developed economies still rely on fossil-fuel-based heating, creating a substantial replacement pipeline. Industrial heat pump deployment is expanding into low- and medium-temperature applications, with systems now capable of delivering process heat up to 150°C, unlocking new use cases in food, chemicals, and textiles. Ongoing developments in smart controls, thermal storage integration, and low-GWP refrigerants are enhancing system flexibility and grid compatibility, further strengthening long-term adoption potential.
Heat Pump Sales by Region (2019–2023)
During the years 2019 to 2023, the Global heat pump sales demonstrated a robust structural expansion with distinct regional variations that at the same time reflected the policy momentum and market maturity. The sales were getting faster gradually from the year 2019 till the year 2022, which was a result of decarbonisation policies, energy security concerns, and the rising electrification of heating, with China being the largest market all the time, the European Union and the United States coming next in line.
The Europe was especially fast in terms of going up to 2022 expansion, which was supported by subsidies and gas-to-electric heating shifts, while the US market was growing slowly but steadily as heat pumps were gaining share over conventional furnaces. Nevertheless, the year 2023 was a turned point when the sales declined in Europe and the US because of higher interest rates, inflationary pressures, and slower construction activity, whereas China was still able to make some growth that partially helped to offset the global declines. At the end of the day, the 2019–2023 year was about the heat pumps’ transition from a next-to-be clean-energy technology to a mainstream heating solution, a solution that is becoming more and more sensitive to macroeconomic conditions and policy stability.
Expert Insight:
Heat Pump Market is transitioning from policy-led growth to a more structurally resilient, electrification-driven phase, with Asia-Pacific firmly anchoring global demand and air-source systems emerging as the undisputed commercial backbone. While residential adoption continues to dominate volumes due to cost competitiveness and incentive support, the real inflection opportunity lies in commercial retrofits and industrial low-to-medium temperature applications, which remain underpenetrated but strategically critical for decarbonisation. The market’s near-term sensitivity to interest rates, grid readiness, and installer availability highlights that future growth will increasingly depend on execution capabilities rather than demand creation alone. Over the medium term, players that combine cost-optimized air-source platforms with advanced controls, grid-friendly designs, and scalable service networks will be best positioned to capture value as heat pumps evolve from a clean-energy alternative into a core heating infrastructure solution.
Heat Pump Market Segmentation
The Heat Pump Market is segmented into by Source, Capacity and End-User.
By Source
Based on Source the Heat Pump industry is segmented into Air-Source, Water-Source and Geothermal. Among this Air-Source dominated the Heat Pump Market accounted for 75 % of total Heat Pump Market shares. This dominance was primarily driven by the Lower upfront costs, easier installation, and compatibility with both residential and small-to-medium commercial buildings. In general, air-source units can be installed quicker and are more flexible when it comes to retrofits as compared to water-source and geothermal systems, thus they are the most favored solutions in the regions with the highest demand which are Asia-Pacific, Europe, and North America. These regions are experiencing a rapid pace of adoption due to the implementation of electrification and energy-efficiency initiatives.
By Capacity
Based on Capacity the Hotel industry is segmented into Up to 10 kW, 10–20 kW or 10–30 kW, Above 20 kW or Above 30 kW. Among this Up to 10 kW dominated the Heat Pump Market accounted for 60.5 % of total Heat Pump Market shares. One of the major factors behind this dominance was mainly caused by the strong demand from the residential sector, as the majority of single-family houses and small apartments need systems of this capacity range. Such units are money-saving, simple to install, and very energy-efficient when used for space heating and cooling in individual households. Moreover, the availability of attractive incentive programs and the uptrend in the residential sector in the Asia-Pacific and Europe regions have contributed to the increased popularity of this capacity segment.
Heat Pump Market Regional Analysis
Asia Pacific Heat Pump Market was the dominated global market in 2024, accounted around 45.5% of the total Heat Pump Market Shares. The three markets, China Heat Pump Market, Japan Heat Pump Market, and South Korea Heat Pump Market, were the main drivers of the regional leadership where quick urbanization, massive residential construction, and electrification programs supported by the government are the main factors that lead to the adoption. To heat and cool multi-family and high-rise buildings, air-source heat pumps were mostly chosen due to their low-cost and simple way of spreading. Besides that, local policy incentives covering 20-30% of the installation costs and the electricity-to-gas price differentials that are getting higher are the main reasons for the rapid market penetration which was a great Asia-Pacific region’s advantage.
Europe Heat Pump Market accounted for 30% of the shares, and the main reasons for this are strict energy-efficiency regulations, decarbonization mandates, and the very high number of gas-fired system retrofitting, thus Germany Heat Pump Market, France Heat Pump Market, and the Nordics Heat Pump Market was the main markets for adoption. The contribution of North America Heat Pump Market was about 20%, the main reasons was cold-climate heat pumps and dual-fuel systems in the U.S. Heat Pump Market and Canada Heat Pump Market, respectively, with the industrial and commercial sectors getting more and more projects. The combination of Latin America Heat Pump Market, the Middle East, and Africa Heat Pump Market as emerging markets was less than 10% of the total demand, however, the increase in urbanization, the integration of renewables, and the implementation of government incentive pilot programs gradually open up more adoption opportunities in these regions.
Heat Pump Market Competitive Landscape
As of 2024, Daikin Industries, Mitsubishi Electric, Carrier, and Bosch Thermotechnology were leading the global heat pump market. Their dominance was a result of their extensive technological portfolios, large R&D investments, and well-established global distribution networks. Daikin and Mitsubishi Electric specialize in air-source and inverter-driven systems, whereas Carrier and Bosch use their commercial and industrial HVAC experience to attract the projects of large-scale retrofits and new constructions. Moreover, these players was allowed to retain a large portion of the premium markets in the Asia-Pacific, Europe, and North America due to the brand trust, after-sales service infrastructure, and partnerships with developers and utilities that they enjoy.
These companies along with the notable players like Viessmann, Trane Technologies, Panasonic, and Johnson Controls (YORK) LG, Samsung, NIBE, Vaillant, Fujitsu, Hitachi, Rheem, Stiebel Eltron, Glen Dimplex, Ingersoll Rand, Midea, and A.O. Smith, are strengthening their market positions through niche product offerings, regional focus, and technological innovations. Firms from Europe such as Viessmann, NIBE, and Vaillant are good at geothermal and low-carbon solutions, whereas companies from Asia like LG, Samsung, and Midea are using cost-competitive residential units for quick adoption in APAC. Trane, Johnson Controls, and Ingersoll Rand are concentrating on the large commercial and industrial sectors, thus they are extending their activities to process heat and district heating, which is indicative of a fragmented but competitive landscape with multiple players addressing both mature and emerging markets.
Heat Pump Market Scope:
Heat Pump Market Key Players –
Mitsubishi Electric Corporation
Bosch Thermotechnology (Robert Bosch GmbH)
Viessmann Group
Panasonic Corporation
Johnson Controls (YORK)
LG Electronics
Samsung Electronics
NIBE Industrier AB
Vaillant Group
Fujitsu General Ltd.
Hitachi Ltd. (Hitachi Cooling & Heating)
Rheem Manufacturing Company
Stiebel Eltron GmbH & Co. KG
Glen Dimplex Group
Ingersoll Rand (Thermo King / Trane brands)
Midea Group
A. O. Smith Corporation
Heat Pump Market Frequently Ask Questions –
1) Who are the major Key players of Heat Pump Market?
Ans – The major key players of Heat Pump Market Are Daikin Industries Ltd., Mitsubishi Electric Corporation, Carrier Global Corporation, Bosch Thermotechnology (Robert Bosch GmbH) and Viessmann Group.
2) Which Region accounted highest share of the Heat Pump Market in 2024?
Ans – Asia pacific region accounted highest share of the Heat Pump Market.
3) What was the market size of Heat Pump Market in 2024?
Ans - In 2024, market size of the Heat Pump Market was USD 95.1 Billion.
4) Which Segment is expected to lead the Heat Pump Market during forecast period?
Ans - Capacity Segment was the top segment hold the largest share in Heat Pump Market.
5) What will be the market size of Heat Pump Market in 2030?
Ans - The market size of Heat Pump Market in 2030 will be USD 160.8 Billion.