Since 2015, heat pumps have been steadily “biting off” the market share of traditional heating systems.
Inflation, political uncertainty, and weakened support schemes in several countries played a role in slowing down sales in 2023 and 2024. Some markets reduced incentives or made access to them more difficult.
Despite the challenges, the technology maintained its strong influence on the market.
In 2024, heat pumps accounted for a solid 28% share of the European heating systems market, according to an analysis by the European Heat Pump Association (EHPA). This is only a few points below the peak of 31.6% in 2023 and still more than 6 percentage points higher than in 2021, when the total number of heat pumps sold was similar.
In terms of national markets, Norway, Sweden, and Finland continued to lead the ranking with over 90% market share of heat pumps for heating in 2024. Norway remained at the top with 97%.
A second wave of countries – France, Austria, Switzerland, and Portugal – also crossed the threshold of 40% of annual heating equipment sales, after being below it just a few years ago. Switzerland’s climb was particularly impressive – reaching 76%.
Meanwhile, large economies such as Germany, Italy, the Netherlands, and the United Kingdom started from a lower baseline. Their market shares ranged between 5% and 30%, which continues to drag down the European average, but also shows that there is enormous growth potential.
EU legislation such as the Energy Performance of Buildings Directive and the Renewable Energy Directive supports the deployment of heat pumps and is likely to have a positive effect on stabilizing the market. In the future, carbon pricing and emissions trading schemes such as the upcoming EU Emissions Trading Scheme (EU ETS2), which will introduce a carbon price for heating buildings from 2027, is expected to steer investments toward low-carbon solutions while protecting vulnerable households. This shift will be further reinforced by new market regulations encouraging demand response and business models based on energy storage.
Summary of the report is available: here
