Reduced emissions from heating in the buildings sector in the Net Zero Emissions by 2050 Scenario depends on high-efficiency electric heat pumps as the primary technology. This is part two of a two-part series.
Even though the overall penetration is growing, heat pumps are still a rather rare solution for replacing existing heating systems due to higher upfront costs or lack of awareness and know-how amongst installers and designers. In such countries, purchasing heat pumps is sometimes incentivised and promoted, such as in in Germany, Italy, UK, US and China. To increase end-user awareness and acceptance, some programmes include financial incentives but also education on the benefits of heat pumps for consumers.
Heat pumps are a well-working and mature technology. However, technology and system improvements are needed to integrate them and use their full potential in the net zero emissions energy systems. Heat pump system efficiency and their impact can be improved with smart system integration together with PV, energy storage, control and e-mobility. In some situations, heat pumps’ capability to operate flexibly could be more important than reaching top level efficiency.
In the ongoing global energy crise, heat pumps have been identified as a solution to strengthen energy security. In Europe, the REPowerEU plan presented by the Commission suggests doubling of the deployment rate of heat pumps within the coming years in order to reduce the dependence on Russian natural gas. In the United States, heat pumps have been identified as a prioritised technology in the Defence Production Act (DPA) for the country to take ownership of its clean energy independence.
One of the main challenges for the technology is the higher upfront costs compared to fossil-fuel-based heating options. In some regions, this can be compensated for with lower running costs and beneficial total life-cycle costs. Profitability of heat pumps compared to their fossil fuel alternatives is in fact also linked to prices of oil, gas, coal and electricity, which have been at record levels since Russia’s invasion of Ukraine, making their use particularly attractive now. Their competitiveness also depends on the electricity generation mix as well as on how different fuels are taxed and subsidised. Taxes and subsidies should reflect prioritisation of heat pumps, for example fees linked to higher saturation of renewable energy sources to be shifted from electricity prices to fossil fuel prices. In comparison to other zero emission technologies, heat pumps are many times, although not always, the most cost-effective alternative on a life-cycle basis.
Beyond economic reasons, challenges are linked to space restrictions or dimensioning of the heating distribution system, and in some cases replacing radiators with larger units since the efficiency of a heat pump is dependent on the temperature of the radiators and thereby on their size. To this extent, the roll-out of heat pumps goes well with renovation plans for the least performing buildings since this might lead to lower distribution temperatures to satisfy the heat demand, allowing operating heat pumps at higher efficiency levels. However, efficiency of heat pumps should and could still be improved, especially for the coldest outdoor temperatures.
Another challenge could be related to permits to install external units, both for sound and visual reasons.
In addition, even though heat pumps are well known and adopted by end users in some mature markets, the awareness and acceptance are low in many other countries. To be able to multiply the number of heat pumps installed each month, the manufacturers need to scale up deliveries and installers need to be trained in sufficient numbers and quality. The responsibility for this should be shared between the public and private sector. Public authorities should support and encourage reskilling and upskilling of the workforce (including installers, planners, architects, engineers and entrepreneurs) and encourage training schemes organised by the private sector.