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According to MarketsandMarkets™, the global Heat Pump Market size is projected to grow from USD 88.81 billion in 2026 to USD 169.04 billion by 2031 at a compound annual growth rate (CAGR) of 13.7% during the forecast period.
Browse over 300 market data tables and 70 figures spread through 335 pages and an in-depth TOC on 'Heat Pump Market – Global Forecast to 2031.'
The global Heat Pump Market is experiencing continued growth as the electrification of space and water heating, decarbonization policies, and the transition away from fossil-fuel-based heating systems accelerate adoption. Heat pumps are increasingly being deployed as energy-efficient alternatives to conventional gas and oil heating systems, supported by energy security objectives, government incentives, and improvements in system efficiency. In 2024, heat pumps supplied around 12% of global space-heating needs in buildings, with deployment concentrated in the United States, China, Europe, and Japan. China remained the largest heat-pump market, while heat pumps in the United States outsold natural gas furnaces by 30% in 2024.
The market is also being shaped by advances in air-to-water systems, heat pump water heaters, low-GWP refrigerants, smart controls, and high-temperature heat pump technologies. Buildings remain the primary deployment segment, while industrial process heating and district heating represent emerging applications as manufacturers expand heat pump solutions beyond conventional residential HVAC. Commercially available heat pumps could technically supply around 20% of global industrial heat demand, mainly across low- and medium-temperature processes. At the same time, the transition toward lower-GWP refrigerants and increasing adoption of natural refrigerants such as R290 and CO₂ are driving product redesign and technology development.
Heat Pump Market Size & Forecast:
- Market Size Available for Years: 2022–2031
- 2025 Market Size: USD 79.42 billion
- 2031 Projected Market Size: USD 169.04 billion
- CAGR (2026–2031): 13.7%
Heat Pump Market Trends & Insights:
- The North America Heat Pump Market is expected to register the highest CAGR of 17.0% during the forecast period.
- By type, the reversible heat pumps segment is expected to register the highest CAGR of 15.9% during the forecast period.
- By technology, the ground-source (Geothermal) heat pumps segment is expected to register the highest CAGR of 15.9% during the forecast period.
- By refrigerant, R20 segment is expected to register the highest CAGR of 25.2% during the forecast period.
- By rated capacity, the upto 10 kW segment is expected to register the highest CAGR during the forecast period.
- By application, the heating and cooling segment is projected to register the highest CAGR during the forecast period.
- By end user, the commercial segment is projected to register the highest CAGR during the forecast period.
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The air-to-water heat pumps segment is projected to record the highest CAGR during the forecast period.
Air-to-water heat pumps are expected to witness strong growth as electrification of space heating and domestic hot water accelerates, particularly in Europe. These systems can replace fossil-fuel boilers while providing heating, cooling, and hot-water functions, making them suitable for both new construction and retrofit applications. The IEA identifies Europe as a major market for hydronic heat pumps and notes that heat pump deployment in buildings is the near-term engine of global growth. The increasing adoption of low-GWP refrigerants, including R290 and R32, is further supporting product development and expanding the addressable market for air-to-water systems.
The commercial segment is projected to be the fastest-growing end user during the forecast period.
Commercial buildings are expected to experience increasing heat pump adoption as businesses seek to electrify space heating and cooling, reduce fossil-fuel consumption, and improve building energy efficiency. Heat pumps are particularly attractive in commercial applications because the same system can provide heating and cooling, while larger systems can integrate with building controls and thermal-storage solutions. The IEA identifies buildings as the primary near-term growth engine for heat pumps, and highlights continued opportunities for larger heat pump systems in commercial buildings, district heating, and other applications.
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North America is projected to be the fastest-growing region in the Heat Pump Market during the forecast period.
North America is projected to be the fastest-growing region in the global Heat Pump Market, supported primarily by strong replacement demand and increasing electrification of building heating. The US is already the second-largest Heat Pump Market globally, with heat pumps outselling gas furnaces for the fourth consecutive year in 2025. More than 20% of US households now use heat pumps for space heating, while around 90% have air conditioning, creating a substantial replacement opportunity as existing cooling systems reach end of life. Approximately two-thirds of US homes have the enabling conditions to replace conventional cooling-only air conditioners with reversible heat pumps, reducing the need for major building retrofits. In 2024, US heat pump sales increased by approximately 15% year-on-year, demonstrating renewed demand after the 2023 slowdown. Government support for clean energy manufacturing, electrification, and energy-efficient technologies is further strengthening regional investment and supply-chain development.
Top Companies in Heat Pump Industry:
The Heat Pump Industry include DAIKIN INDUSTRIES, Ltd. (Japan), Carrier (US), Mitsubishi Electric Corporation (Japan), Midea Group (China), Panasonic Holdings Corporation (Japan), Bosch Thermotechnology Corp (Germany), LG Electronics Inc. (South Korea), Vaillant Group International GmbH (Germany), Viessmann Climate Solutions SE (Germany), Ariston Holding N.V. (Italy), Trane Technologies plc (Ireland), Johnson Controls (Ireland), Fujitsu (Japan), A. O. Smith Corporation (US), and NIBE Industrier AB (Sweden). These companies are strengthening their market positions through heat pump portfolio expansion, low-GWP refrigerant adoption, energy-efficiency improvements, product innovation, geographic expansion, strategic acquisitions, and investments in residential, commercial, and industrial heating applications.
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