European heat pump policy and market status and prospects

European heat pump policy and market status and prospects

Source | Wilo Pumps

From July 31st to August 2nd, the "2023 China Heat Pump Industry Annual Conference" sponsored by China Energy Conservation Association and hosted by China Energy Conservation Association Heat Pump Committee was successfully held in Nanjing. During the meeting, the "Heat Pump Export and International Market Development Forum" was held. Thomas Nowak, Secretary-General of the European Heat Pump Association (EHPA), cooperated with Xiao Lun, Director of Emerging Markets of Wilo Group and Wilo China Market, to discuss the latest developments in the European heat pump market and policies. theme speech.

Good morning, everyone. I am very happy to finally come to China after several years of the epidemic. The Heat Pump Committee of China Energy Conservation Association has made great contributions to the promotion of the global heat pump industry. The China Heat Pump Industry Annual Conference is also the largest in the world that I have ever attended. industry event, today we will share with you some information on European heat pump policies and markets.

This image shows the beginning of the European heat pump story, when geothermal heat pumps were first promoted as a new form of energy at the European Parliament in Strasbourg, France, in 2009. Since then, heat pumps as efficient energy devices, heat pump applications in buildings, Ecodesign and energy efficiency labeling, F-gas EU fluorinated gas scheme, markets and industries for electricity consumption – flexible tariffs, EU climate law, EU ETS II Carbon tariffs and carbon market II - including heating, and the implementation of a series of European heat pump-related policies and regulations are the background for the booming development of our heat pump industry today.

The slide below shows three key figures. The first figure is that 3 million heat pumps will be used across Europe in 2022. The second figure is that the European Heat Pump Association estimates that the total stock of heat pumps will reach 6,000 in 2030. Ten thousand units, the third number is the total heat pump usage expected by the IEA in Europe by 2050.

From 2010 to mid-2022, the initial growth rate of the European heat pump market was not high. Through some of the work we have done our best in recent years, the heat pump market began to gradually explode from 2017, and sales doubled from 2017 to 2021. , there will be a blowout in heat pump sales in 2022, with a growth rate of 39%. It is expected that the growth rate this year may be slightly lower than last year. Generally speaking, the heat pump industry is currently in a stage of rapid development in Europe, and the growth rate will be faster and faster.

The picture below shows the heat pump sales in various European countries in 2022. Sales in France, Italy and Germany account for about 50% of total sales in Europe. Sales in the Top 10 countries account for about 90% of total sales. However, we should pay more attention to the sales in each country. Incrementally, many of these countries have huge potential.

Some small countries are growing very fast, such as Belgium, the Czech Republic, and Slovakia.

The 3 million heat pumps sold last year played a big role in energy conservation in Europe. The number in the lower left corner shows that many renewable energy sources may bring instability to the power grid, but heat pumps are conducive to the stability of the power grid.

In addition to its huge contribution to environmental protection, heat pumps can also promote employment. The production, installation, accessories production, service, maintenance and other aspects of the heat pump host can create many jobs.

The figure below shows the layout of heat pump manufacturers in Europe. Currently, there are more than 175 heat pump factories in Europe. The distribution is relatively balanced. They are mainly small and medium-sized enterprises with a total turnover or sales of more than 20 billion euros. However, the supply of heat pump products in Europe mainly comes from China. In order to reverse this situation, many European countries have introduced some policies to encourage local production of heat pump products.

The figure below shows the share of heat pumps in the heating field. In 2022, it will account for about 29%, and it is expected to account for more than 50% by 2030.

In 2022, the European heat pump heating stock market will be 17 million units. At present, the total heating equipment is about 116 million units, and heat pumps account for about 15%. From the perspective of market share, heat pumps have huge potential.

From the data of Eurostat on the final energy demand for heating and cooling in the 27 EU countries, it can be seen that the proportion of renewable energy (green dot) increases by 1% every year, and the target of European legislation mentions that the growth rate of renewable energy should be There is an increase of 1.5%, and the target set in the latest legislation is about 2.8%. The growth rate of renewable energy use in heating and cooling final energy has not yet reached expectations.

According to data from the European Heat Pump Association, the Nordic countries such as Finland, Norway, Sweden, and Denmark will have the highest share of heat pump ownership per 1,000 households in 2022. The ambient temperature in these places is more severe, which proves that heat pumps can also operate well in low-temperature environments, and also proves that heat pumps have a very broad application field.

Through in-depth exchanges with other industry organizations such as the Heat Pump Special Committee of the China Energy Conservation Association, the European Heat Pump Association has predicted the future growth trend of global heat pumps. Through the prediction, we see that the number of heat pumps is expected to increase by 6 million units per year in 2030.

With the rapid development of the heat pump market, the stock market share of heat pumps will gradually exceed 50%.

The global heat pump industry is guided by government policies and regulations. At the same time, the Russian-Ukrainian war, climate change, etc. have also promoted the vigorous development of the heat pump industry. In the past two years, the IEA International Energy Agency has mentioned heat pumps many times in its measures to deal with Russia's cut off of natural gas supply. In addition, a series of policies and regulations issued by the European Union and the United Nations have continuously emphasized the importance of heat pumps.

In 2030, Europe's energy targets for the proportion of renewable energy, energy efficiency ratio and carbon emission reduction are relatively aggressive. At the same time, in these three major areas, heat pumps can make a very large contribution.

Policies to promote the development of heat pumps ultimately require specific practical actions. Last year, the European Heat Pump Association formally submitted a document called "EU Heat pump Accelerator" to the EU in Brussels, Belgium, which included some specific implementations. action plan.

While heat pumps are booming, they also have a great impact on fossil energy-related companies. They will also make some efforts to arouse public resistance to heat pumps. Therefore, it is necessary for heat pump colleagues to unite to promote the positive development of the industry.

For the long-term healthy and rapid development of heat pumps, it is first necessary to ensure product quality, improve technology and installation levels, strengthen the training of professionals, improve laboratory testing capabilities, and integrate information technology. Secondly, we must strengthen the stability of the power grid, including increasing the capacity of the power grid.

In addition, policies and related regulations and standards must be improved and established. For example, improving energy taxes, electricity prices, and one-stop purchasing and financing business models, etc., can promote the healthy development of the entire heat pump industry, and can also help us transform from a strong push by the government to an effective push by end users.

The problems faced by heat pumps replacing natural gas are firstly the initial purchase cost, and secondly the comparison between electricity prices and natural gas prices. It is difficult to reduce the purchase cost of heat pumps for the time being. Therefore, it is hoped that the government can reduce electricity prices through policies and regulations to make heat pumps more competitive. It should be emphasized that the data in the figure also applies to industries such as industry.

The greener the color in the picture below is, the more advantageous the electricity price is in that area. The redder the color, the less advantageous the electricity price is compared to natural gas. This trend is basically proportional to the data on the number of heat pumps per 1,000 households.

The figure below shows the complementary use of new energy by end users in developed countries, including the combination of heat pumps and photovoltaic systems, heat pumps and electric vehicles, etc.

There is the possibility of crossover between different energy sources. Musk mentioned heat pumps in his introduction. Although his company does not currently produce heat pumps, it is entirely possible that it will enter the field of heat pumps in the future. This is the integration, complementarity and penetration of various energy forms and solutions.

The new decade of heat pumps has just begun, and now many policies, regulations, and standards have been relatively sound. This is the result of everyone's joint efforts over the years. I hope that everyone will continue to work together to make the global heat pump market bigger and stronger.