Decline in Heat Pump Sales Puts €7 Billion in Investments at Risk

16/12/2023

New data from the European Heat Pump Association (EHPA) reveals a downturn in heat pump sales across Europe in 2023. While the first quarter showed strong performance, sales of space and water heating heat pumps declined in the second and third quarters. In the 10 countries analyzed, average sales in Q3 2023 fell by 14% compared to the same period in 2022.

This downward trend threatens the EU’s decarbonization goals and endangers €7 billion in announced investments by heat pump and component manufacturers for new or upgraded production facilities planned between 2022 and 2025. The decline is largely attributed to unclear messaging from policymakers, changes in government policies and subsidies, and resulting consumer uncertainty. Additionally, falling fossil gas prices and unchanged electricity costs—used to power most heat pumps—have made heat pump operation less economically attractive.

The European Commission must address these issues in its upcoming Heat Pump Action Plan, scheduled for early 2024. National governments are also urged to provide solutions in their updated National Energy and Climate Plans, including balancing energy taxes, phasing out fossil fuel subsidies, and reducing the tax and levy burden on electricity.

EHPA Secretary General Thomas Nowak commented:
“Heat pumps are the most cost-efficient and climate-neutral heating and cooling solution, but consumers still perceive them as expensive and uncertain. Policymakers must correct this by demonstrating clear commitment to heat pump technology and by establishing favorable economic conditions for the cleanest heating solutions.”

Of the 10 countries analyzed by EHPA, eight showed a downward sales trend across quarters in 2023. Germany was the only country to consistently outperform 2022 sales figures, though the margin has been narrowing as the year progresses.

European Heat Pump Association