Millions of heat pumps will be installed in Germany in the next few years.
In order to achieve this ambitious goal, the federal government's concept paper envisages, among other things, a 65% share of renewable energies in the installation of new heating systems from 2024.
In addition, there is the structurally revised BEG guideline ("Federal subsidies for efficient buildings"), which has already regulated the subsidies for individual heat generators or their replacement since 15 August 2022.
Future of Heat Generator Market in Germany
If one believes the (in my opinion, realistic) industry forecasts for 2022, heat pump sales in Germany will increase by 30% or more for the third year in a row since 2019.
A dynamically developing market and attractive framework conditions inevitably lead to increasing competitive intensity, and new sales channels, concepts and approaches are also becoming increasingly important. Although it can be assumed that domestic manufacturers still dominate the German market, competitive pressure is continuously increasing - and not only from Asia.
Recently, the family-run Ariston Group from Italy announced that it would buy Centrotec, a company specialising in energy-efficient building technology. Their brands, in turn, include Wolf and Brink. As part of this acquisition, they have tapped into a part of the German market for heat generators and controlled domestic ventilation.
In an increasingly complex and "energy-charged" environment, sound industry knowledge and strategic foresight are in demand, and I am glad that I can draw on more than 20 years of professional experience in the HVAC industry in my consulting activities.
This article was contributed by our expert Oliver Blume
Frequently Asked Questions Answered by Oliver Blume
Q1. What is the difference between a heat pump and a gas boiler?
First of all, it should be noted that heat pumps and gas heating are technically based on fundamentally different principles. While gas heating generates heat by burning fossil fuel, the heat pump uses electricity to raise the temperature level of freely available environmental heat.
One key figure for the efficiency of a heat pump is the COP (Coefficient of Performance). This indicates the ratio of the heat generated by the heat pump to the drive energy (electricity) required for this. Simply put, it measures how many units of heat a heat pump can generate from one unit of electricity and deliver it to the heating circuit. The higher the COP, the more efficiently the heat pump works.
For example, a COP of 4 says that a heat pump with one kilowatt (kW) of electricity provides four kilowatts of heat. The heat pump is, therefore, not only an environmentally friendly way of generating heat but also a very efficient one.
Q2. What will replace gas boilers after 2025?
The "traditional gas boilers" still accounted for the largest share of the annually installed heat generators, even in 2021. However, they are gradually being replaced by more efficient heating solutions, such as boilers with better efficiencies.
In addition, legislation will require a particular "regenerative share" for every installed heating system in the future. So-called "hybrid solutions" (such as combining a gas condensing boiler with a heat pump) are also possible. However, electrically driven heat pumps will account for the largest share of replacements in the future.
Q3. What is the size of the European heat pump market?
In 2021, a total of approx. 2.2 million heat pumps were sold in Europe. Compared to the previous year, this is a growth of +34%. It can be assumed that this number will be reached or even exceeded this year, again.
According to a recent publication by the EHPA (European Heat Pump Association), market data for the first half of 2022 indicates sales growth of about 25%. The already installed stock within the 21 European markets counts for approximately 17 million heat pumps.
Q4. What are the major drivers for the heat pump market?
At the EU level, heat pumps had been identified as a key product to reach Co2 goals and "green targets ". The main objective is to become climate neutral by 2050 and save at least 55 percent of greenhouse gases by 2030 compared to 1990.
The most important drivers of the market are, on the one hand, the subsidies that stimulate the demand for heat pumps. These are possible in both new construction and renovation. On the other hand, governmental regulations restrict the installation of fossil heat generators (such as gas or oil) from 2024 or even ban them entirely from 2025 in some cases.
