The global water source heat pump market size is anticipated to gain substantial growth from 2023 to 2033. According to the research report published by Future Market Insights, the global market is projected to exceed a valuation of USD 1,002.5 million in 2023. It is estimated to attain a valuation of USD 1,617.5 million by 2033. The market is predicted to thrive at a CAGR of 4.9% from 2023 to 2033.
The expansion of the market may be attributed to the increasing deployment of bio-based infrastructure amid calls for reducing carbon footprint across various industries. Further, water source heat pump usage is rising due to growing demand in industries and in residential applications to reduce adverse environmental impacts associated with operating conventional heat pumps.
Water source heat pump systems are among the highly efficient, environment-friendly systems available for heating and cooling buildings. Furthermore, high-efficiency, self-contained units are available in a variety of sizes and configurations and may be placed in virtually any location within a building.
Each water source heat pump system responds only to the heating or cooling load of the individual zone it serves. This permits an excellent comfort level for occupants, better control of energy uses for building owners, and lower seasonal operating costs.
Commercial water source heat pumps may be applied to geothermal closed-circuit or open-well loops, or on a traditional boiler/tower loop system. These systems offer benefits ranging from low-cost installation to the top energy efficiency available in the market today.
| Attributes | Details |
|---|---|
| Water Source Heat Pump Market Share (2022) | USD 961.2 million |
| Water Source Heat Pump Market Share (2023) | USD 1,002.5 million |
| Water Source Heat Pump Market Share (2033) | USD 1,617.5 million |
| Water Source Heat Pump Market Share (2023 to 2033) | 4.9% |
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Rapid Urbanization and Consequent Rise in Building Construction to Bode Well for Market Demand
Increased investment in the construction and residential sectors may provide new growth markets for water source heat pump suppliers. Further, significant growth in the adoption of energy-efficient heat pumps, on the back of changing climatic conditions, rapid urbanization, and demographic transformations, has also been complementing the demand for water-source heat pumps.
Governments of countries such as Germany, the United Kingdom, and France provide subsidies and encourage the adoption of water-source heat pumps to attain zero carbon footprint. Additionally, the water source heat pump industry may largely be driven by the high adoption of heat pumps and increasing awareness of the energy-efficient system. Increasing urbanization and industrialization are prominent trends that may drive the adoption of water-source heat pump
Increasing demand for Energy-Efficient Systems for Heating to Propel the Growth of the Market
Continuously growing concerns regarding environmental sustainability & energy security coupled with the shifting trends for bio-based infrastructure may boost the water source heat pump industry growth. In addition, a strong inclination toward the requirement of carbon-free equipment along with favorable government policies to reduce fossil fuel consumption may positively boost the business scenario.
The market for water source heat pumps is projected to increase as consumers want environment-friendly and technologically advanced heating and cooling equipment. Moreover, the rising preference for green technology among consumers, complementing the governments’ awareness initiatives, may remain a vital growth influencer associated with the water source heat pump industry.
Which Factors are Restraining the Growth of the Water Source Heat Pump Industry?
Some obstacles are likely to pose a challenge to market growth although the water source heat pump industry has numerous end-uses. Moreover, the high cost associated with heat pumps may restrain the growth of the market throughout the forecasting period. Also, low consumer confidence and less developed technology are expected to restrain overall water source heat pump demand.
Another factor restraining the growth of the market is water source heat pumps need to be located close to a conditioned space, where they may generate radiated sound. However, different measures have been practiced to reduce this radiated sound to acceptable decibel levels.
With insufficient water supply, a water source heat pump lowers the temperature of the water to the point at which the system would not run efficiently or would get dysfunctional. The more heat that needs to be generated, the large the water source required. All these factors may impede the growth of the water source heat pump market during the forecasting period.
The global water source heat pump industry size developed at a CAGR of 4.1% from 2018 to 2022. In 2018, the global market size stood at USD 786.2 million. In the following years, the market witnessed considerable growth, accounting for USD 961.2 million in 2022.
Water source heat pumps now perform better and are efficient and dependable owing to technological advancements. These advancements include enhanced heat exchange components, variable speed compressors, and many sophisticated control systems. Further, these technological advances have made water source heat pumps increasingly attractive and encourages the industry to flourish.
Water source heat pumps are becoming increasingly common as the world places a great emphasis on sustainability and lowering greenhouse gas emissions. These systems are capable of providing effective heating and cooling without the use of fossil fuels by leveraging the relatively consistent temperature of water bodies or geothermal sources. These capabilities of systems propel their demand in the global market further.
The Water to Air Segment Accounts for the Dominant Market Share
Based on product type, the water source heat pump market is segmented into the water to air and water to water pumps. Among these, the water to air segment is likely to account for the leading share of the global water source heat pump market during the forecast period. The water to air segment is expected to dominate the market, with a growth rate of 4.7% from 2023 to 2033. The water to air segment captured a 61.5% share in 2022.
The demand for the water to air segment is increasing in the residential sector owing to its low installation cost and environment-friendly technology. Water to air heat pumps are only compatible with forced-air HVAC systems and may supply both heat and AC. On the other hand, the water to water segment accounts for a significant share of the water source heat pump market. Water to water heat pumps may only supply heat or hot water for homes and businesses, not AC.
Commercial Segment to Remain Notable Across the Global Market
FMI’s latest report on the water source heat pump industry estimated that the commercial segment accounted for a market share of 39.2% in 2022, due to the unique and simple design of water source heat pumps. Also, a water source heat pump is ideal for a wide range of building types including office buildings, apartment buildings, hotels, condominiums, schools, and much more.
The residential segment accounts for a moderate share of the water source heat pump industry. Further, the adoption of water-source heat pumps is increasing in the residential sector, primarily due to its energy-efficiency technology and various government initiatives in the form of subsidiaries or tax benefits offered to enhance the demand for water source heat pumps. In 2022, the residential segment captured a 27.5% share of the global market.
Increasing Demand for Energy-efficient Systems to Market in North America
North America water source heat pump industry accumulated a market share of 38.2% in 2022 and the trend is forecasted to continue over the assessment period. North America is anticipated to be the dominant market for water source heat pumps market due to the factors such as:
In 2022, the United States captured a 20.5% share of the global market. The presence of many water-source heat pump manufacturers in the region boosts the growth of the market.
Other factors driving the growth of the market for water source heat pumps in North America particularly in the United States, include:
Favorable Regulatory Incentives for Water Source Heat Pumps to Boost the Growth of the Market
Europe is expected to accumulate a market value of USD 125.5 million in the water source heat pump sector in the forecasting period. Europe also offers potential growth opportunities in the water source heat pump industry due to the increasing demand for heating & cooling in the region. Further, increasing demand for efficient space heating technologies on account of the growing building sector across Europe may boost the market growth in the coming years.
The increasing urbanization in the region and the high standard of living account for the increased use of air-to-water heat pumps among residents. Also, several regulatory norms and schemes about energy efficiency may drive the demand for efficient & sustainable heating systems, thus complementing the water source heat pump sales. For instance,
Increasing Adoption to Reduce Environmental Impact from Conventional Heaters Drives Sales
Asia Pacific is expected to show a high market attractiveness index and is considered to be a notable market. This region is expected to dominate the global water source heat pump industry in terms of revenue share and expand at a comparatively high growth rate than other regions. A CAGR of 4.5% has been estimated for Asia Pacific market.
Asia Pacific dominates the global market and the trend is estimated to continue during the forecast period also, due to rapid urbanization and industrialization in notable economies such as China, South Korea, and India. Also, initiatives for a shift toward renewable energy sources from conventional energy by governments in countries of Asia Pacific are expected to have a positive impact on the global market for water-source heat pumps during the forecast period.
India is predicted to witness robust growth during the forecast period due to rising urbanization, industrialization, improving income levels, and expanding population. India captured a 6.0% share of the global market in 2022.
| Countries | CAGR (2022) |
|---|---|
| The United States | 20.5% |
| The United Kingdom | 3.8% |
| China | 5.5% |
| Japan | 6.4% |
| India | 6.0% |
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Prominent start-ups in the water source heat pump industry are adopting various marketing strategies such as new product launches, geographical expansion, mergers and acquisitions, partnerships, and collaboration. By following these strategies, these start-ups identify the interest of potential buyers and create a large customer base.
Some of the startup companies operating in the water source heat pump industry are Ecotech Solutions, OSB Heat Pumps, Sprsun, and Guangdong Folansi Energy Saving Equipment Co. Ltd.
In March 2022- SPRSUN, announced its new and self-developed R32 Cold Climate Full Inverter Heat Pumps. The new line of cold climate full inverter heat pumps is designed to bring comfort closer to customers while leveraging hot water, heating, and cooling.
Key players in the global water source heat pump industry are Trane, Vaillant Group, Viessmann, Glen Dimplex Group, STIEBEL ELTRON GmbH & Co. KG, Bosch Thermotechnology Corp., Danfoss, Daikin, Carrier, Johnson Controls, Rheem Manufacturing Company, Modine Manufacturing Company, Aermec S.p.A., Bard HVAC, OCHSNER, Mitsubishi Materials Techno Co., WOLF GmbH, Weishaupt Group, and Swegon Group AB.
Recent Developments Observed by FMI:
| Attribute | Details |
|---|---|
| Forecast Period | 2023 to 2033 |
| Historical Data Available for | 2018 to 2022 |
| Market Analysis | USD million for Value |
| Key Regions Covered | North America; Latin America; Asia Pacific; Europe; The Middle East & Africa (MEA) |
| Key Countries Covered | The United States, Mayada, Germany, The United Kingdom, Nordic, Russia, BENELUX, Poland, France, Spain, Italy, Czech Republic, Hungary, Rest of EMEAI, Brazil, Peru, Argentina, Mexico, South Africa, Northern Africa, GCC Countries, China, Japan, South Korea, India, ASIAN, Thailand, Malaysia, Indonesia, Australia, New Zealand, Others |
| Key Segments Covered | Product, Technology, Application, Region |
| Report Coverage | Market Forecast, Company Share Analysis, Competition Intelligence, Trend Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives |
The global water source heat pump market is valued at USD 1,002.5 million in 2023.
The global water source heat pump market is projected to reach a valuation of USD 1,617.5 million by 2033, exhibiting a CAGR of 4.9% through 2033.
Trane Technologies, Vaillant Group, Viessmann, Glen Dimplex Group, and STIEBEL ELTRON GmbH
North America, with a 38.2% market share in 2022, is expected to be the leading segment over the forecast period.
The water source heat pump market witnessed a 4.1% CAGR, going from USD 786.2 million in 2018 to USD 961.2 million in 2022.
| Estimated Market Size (2024E) | USD 51.6 billion |
|---|---|
| Projected Market Value (2034F) | USD 136.2 billion |
| Value-based CAGR (2024 to 2034) | 10.2% |
| Market Size (2023) | USD 3.2 billion |
|---|---|
| Market Value (2033) | USD 4.8 billion |
| Growth Rate (2023 to 2033) | 4.3% |
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