As sales dip, heat pump sector warns EU goals at risk without supportive policies

The European heat pump sector has issued a stark warning that without stronger and more consistent policies, EU energy goals may not be met. The EU currently has a goal of 60 million more heat pumps to be installed by 2030. After outstanding sales in 2022, first sales figures from 2023 from show a worrying drop in sales, indicative of a larger trend.
As sales dip, heat pump sector warns EU goals at risk without supportive policies
Courtesy of NREL.

In Italy, for example, sales between the first halves of 2022 and of 2023 fell by 34 percent.  In Finland, the drop was 17 percent. In Poland, it was 6 percent but the current trend, after the second quarter, takes the decline in sales as high as 20-30 percent compared to 2022.

The heat pump sector is being impacted by governments changing policies, including on subsidies and support for buying a heat pump, as well as gas prices which have fallen again while electricity prices stay high. This means consumers, who are also facing inflation, high interest rates and rising cost of living, have less confidence in the market for heat pumps. It is difficult to save on the operational cost of heat pumps while electricity prices stay high. The price ratio between electricity and gas must come down.   

“With strong policies and great sales showing a clear path ahead in 2022, heat pump manufacturers invested massively in production capacity” said Thomas Nowak, secretary general of the European Heat Pump Association (EHPA). “Now, sudden policy changes and unfavourable electricity to gas price ratios have shaken end users’ confidence. This is a serious threat to the heat pump sector - a key EU net zero industry - as well as slowing Europe on its path towards net zero and energy independence. We urge the European Commission to fast forward its upcoming heat pump action plan, and to include measures to ensure long-term stability in demand and affordability of clean heating solutions at its heart. These measures must then be replicated at national level.”

The upcoming EU heat pump action plan is expected to provide policy clarity by setting out measures to address barriers to heat pump growth. These include an unhelpful electricity to gas price ratio, a lack of clear information to consumers, subsidies to fossil fuel heating, and the need for more trained installers. EHPA and 20 other organisations gave input in an EU Heat Pump Accelerator document, which was handed over to the European Commission in June 2023.

In addition to the heat pump action plan, the ‘industry dialogues’ set out by Commission President von der Leyen in her State of the EU speech earlier this month, and to be taken up by Executive Vice-President Šefčovič, should include heat pumps.

The heat pump sector’s warning reflects the opinion of many participants of the EU Heat Pump Forum, a two day event which began yesterday (Wednesday 27th September), and continues today with a key-note speech from EU Energy Commissioner Kadri Simson. 

The event is being attended by nearly 300 sector representatives, EU policy makers, thinktanks and NGOs.

For additional information:

European Heat Pump Association (EHPA)

EU Heat Pump Forum

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