Heat pump is a device that collects heat from sources such as air, water, and ground, and transfers the heat to another location, typically against a temperature gradient. Heat pumps have many advantages such as low running costs, less maintenance, less carbon emissions, and long life span among others. Usage of heat pump is the most energy efficient way to provide heating and cooling to various processes in the end-use industries such as pharmaceutical, textile, food processing and cold stores, automobile, and hotels.
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Increasing consumption of energy in buildings is one of the major factors driving growth of the market
One of the major factors attributed to growth of the market is the rising consumption of energy in buildings. For instance, according to the International Energy Agency (IEA) analysis, in 2015, building and building construction sectors were accounted for around 37% of the global final energy consumption and around 40% of total direct and indirect CO2 emissions whereas, energy consumed by transportation sector was 28%, by iron, steel, and cement manufacturing industries was 30%, and others 5%, respectively. According to this statistics, buildings and construction accounted for around one-third of global final energy consumption. Therefore, rising consumption of energy in buildings will positively increase the installation of heat pumps near buildings. This heat pump is a highly energy-efficient alternative over the furnaces and air conditioners, which results in less energy usage. Hence, this factor is expected to fuel growth of the global heat pump market over the forecasted period.
Global Heat Pump Market: Restraints
High cost of heat pump is one of the major factors hindering growth of the market. For instance, according to Coherent Market Insights’ analysis, price for 1.5 Tons, 800cfm, 5kw heat pump was US$ 3,350, price for 2.5 Tons, 1200cfm, 7kw heat pump was US$ 4480, and price for 5 Tons, 2000cfm, 10kw heat pump was US$ 6890. Therefore, the price of heat pump depends on the capacity of the heat pump.
Global Heat Pumps Market: Segment Trends
Among product type, air to air segment accounted for the largest market share in 2017 and is expected to maintain it over the forecast period. Air to air heat pumps are generally used to provide heating during cold season and cooling during the summer seasons. Air conditioning systems have less co-efficient of performance (CoP) when compared to air to water heat pumps. This factor in turn helps in saving energy. Moreover, the benefits offered by air to air heat pumps include ease of operation, low installation cost, installation of complex heat distribution systems such as radiators or underfloor heating is not needed, and low operational cost among others.
Global Heat Pumps Market: Regional Insights
Asia Pacific is expected to grow with highest CAGR in the global heat pump market over the forecast period. Rapid urbanization, industrialization, and favorable government investments for the development of buildings are some of the factors leading to increasing investments in construction sector for building houses in emerging economies such as India and China. For instance, in June 2018, according to the India Brand Equity Foundation (IBEF) analysis, the Indian government announced the allocation of US$ 92.22 for the construction sector. Therefore, increasing number of construction of new buildings will positively increase the demand for heat pumps in this region, thereby driving growth of the market.
Key players in Heat Pump Market
Key players operating in the global heat pump market include Danfoss Group Global, Daikin Industries, Ltd, StiebelEltron Gmbh & Co.KG, Bosch Thermotechnik GmbH, NIBE Global Group, Thermsaver Inc., Glen Dimplex Group, Viessmann Group, Mitsubishi Electric, Corporation, and Enertech Group Ltd.
The global heat pump market is highly fragmented and new entrants in the market are expected to bring in competition to the existing market players. Therefore, existing market players are adopting strategies such as mergers & acquisitions, new product developments, and collaborations. This will further help the market players to gain competitive edge in the market. For instance, in April 2017, NIBE launched two products F1155 and F1255 that are inverter driven ground source heat pumps, both of which were awarded with MCS certification. This allows the heat pump to automatically adjust itself to the power demand, which results in optimal savings and reduced energy consumption as the heat pump is working.