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The Worldwide Power Company calls warmth pumps the ‘central expertise’ for low-carbon heating. Whereas geopolitical shocks and nationwide choices form adoption patterns, for many shoppers the decisive issue is the electrical energy to gasoline value ratio, a research by the German state-owned promotional financial institution KfW reveals.
Warmth pumps effectively electrify heating, working like reverse fridges. A refrigerant absorbs ambient or geothermal power, which is compressed and transferred indoors by way of a warmth exchanger. As a result of they salvage thermal power from the atmosphere, trendy warmth pumps ship three to 4 instances extra power than the electrical power they eat, measured by the seasonal efficiency issue (SPF).
A warmth pump with an SPF of three produces 3 kilowatt-hours (kWh) of warmth per 1 kWh of electrical energy, whereas gasoline boilers convert 1 kWh of gasoline to nearly 1 kWh of warmth. Thus, if electrical energy prices are lower than 3 times the gasoline value, warmth pumps are extra economical.
The electricity-to-gas value ratio varies extensively throughout Europe, influenced by historic coverage decisions – from reactions to the Seventies oil crises to the gasoline value shocks after Russia’s invasion of Ukraine. The paths of Sweden, France and Germany illustrate how nationwide buildings, power insurance policies and markets form this ratio.
Determine 1: Electrical energy to gasoline value ratio 2024 (Supply: EHPA Market Report 2025)
Sweden: An early swap from oil, early analysis in warmth pumps and a low share of gasoline in heating
- Electrical energy to gasoline value ratio (2024): 1.5
- Warmth pump inventory (2024): ca 50 per 100 households
- Warmth pump gross sales (2024): ca 3 per 100 households – market share: 92.4%
The Nordics lead Europe in warmth pump inventory and gross sales. With no in depth gasoline grids, households traditionally relied on oil or electrical resistive heating. That and the open structure of many houses make air-to-air warmth pumps particularly enticing, without having for in depth ducting and renovation. The Nordics present that warmth pumps work very effectively in chilly local weathers.
Sweden started adopting warmth pumps within the Nineteen Nineties, with fast development from the early 2000s. After the oil shocks of the Seventies, it determined to maneuver away from oil. The Swedish Power Company promoted analysis, and in 2005, the federal government created a Fee for Oil Independence. Sweden is now one of many world’s high 4 warmth pump exporters. Its large-scale adoption, mixed with district heating reform and higher constructing effectivity, makes it a European chief in decarbonizing heating.
Coverage drivers
Sweden launched a carbon tax in 1991 (€21 per ton of CO2), which has risen to €134 per ton of CO2 in 2025. Client prices for gasoline and oil are on the similar stage as electrical energy. Households can deduct set up prices for warmth pumps however obtain no direct buy subsidies. Authorities tenders help R&D to extend effectivity and decrease prices of warmth pumps, whereas data campaigns and coaching of installers construct shopper confidence.
France: Nuclear energy gives 70 per cent of electrical energy, however fossil fuels dominate heating
- Electrical energy to gasoline value ratio (2024): ca 2.5
- Warmth pump inventory (2024): ca 20 per 100 households
- Warmth pump gross sales (2024): ca 1.7 per 100 households – market share: 45%
With over 4 million put in models – principally air-to-water – France has extra warmth pumps than another European nation. In inventory and gross sales of warmth pumps, it leads the larger industrial nations of the EU. But fossil fuels nonetheless dominate heating: in 2024, about 12 million households used gasoline boilers, and in 2022, roughly 3.5 million relied on oil. In 2020, 36 per cent of metropolitan houses have been heated by community gasoline and 37 per cent by electrical energy, most of it inefficient resistive heating. Warmth pump adoption started rising within the 2010s and accelerated after 2020.
Historic background
In response to the Seventies oil shock, France quickly constructed nuclear vegetation. By the mid-Nineteen Eighties, nuclear equipped 70 per cent of electrical energy, creating oversupply throughout sure instances. To make use of this capability, the state and the state-owned electrical energy provider EDF promoted electrical heating and capped retail energy costs. Fossil fuels have been taxed extra closely, and since 2022, new oil boilers have been banned, with a plan to interchange all oil boilers by 2028.
The MaPrimeRénov programme, launched in 2020, gives grants for warmth pumps, tiered primarily based on earnings, family measurement and area. VAT on warmth pumps has been lowered to five per cent from the common 20 per cent. The brand new constructing code RE2020 encourages passive-house requirements and warmth pump use in new development.
Germany: Costly electrical energy and reluctant transfer away from gasoline
- Electrical energy to gasoline value ratio (2024): ca 3.25
- Warmth pump inventory (2024): 5.4 per 100 households
- Warmth pump gross sales (2024): ca 0.6 per 100 households – market share: 27%
In my neighbourhood, with its 40-year-old single homes and gasoline heating throughout, the change to low carbon heating moved in phases. Individuals started utilizing photo voltaic thermal sizzling water heating and photo voltaic photovoltaics (PV) about 25 years in the past, however solely on part of their roofs. Now many equip their entire roofs with photo voltaic PV, put batteries within the basement and rethink warmth pumps. In addition they rethink when renovating. Warmth pump gross sales started rising after 2015 and surged after 2022 as gasoline costs soared following Russia’s invasion of Ukraine. In 2024, 77 per cent of recent single houses put in warmth pumps, whereas gasoline boilers fell to 5 per cent in new builds.
Historic pricing and coverage
Germany’s response to the Seventies oil shocks was totally different. It launched the ‘Kohlepfennig’ (‘coal penny’) – a levy on electrical energy to subsidize coal – maintaining electrical energy costly. Selling power financial savings by the imposition of upper costs turned a centrepiece of German power coverage. Even right now, a couple of third of the electrical energy value consists of taxes and surcharges, together with 19 per cent VAT. In consequence, Germany has Europe’s highest family electrical energy costs.
Gasoline was lengthy thought-about a ‘bridge gas’. Nuclear phase-out and business pursuits delayed its discount. The nationwide emissions buying and selling scheme (2021) added €55 per ton of CO2 by 2024. That and the dependency on Russian gasoline doubled retail gasoline costs after 2022.
Current developments
The visitors gentle coalition of Social Democrats, Greens and Liberals in 2023 launched a tiered grant scheme protecting as much as 70 per cent of warmth pump prices for low-income households. But a media backlash in opposition to the brand new heating regulation eroded public belief, portraying the shift as coercive. Shoppers stay very sceptical after municipalities have been tasked with a brand new native warmth plan. By the top of January 2026, the brand new coalition had aimed to stipulate the important thing components of a brand new heating regulation. Nonetheless, the self-imposed deadline was missed, partly resulting from disagreements between the Christian Democrats and Social Democrats.
What now?
After file development in 2022–2023, the European warmth pump market slowed in 2024. Falling gasoline costs, excessive rates of interest and coverage uncertainty lowered gross sales – down 24 per cent in France and Sweden and 48 per cent in Germany, returning to 2020–2021 ranges. Restoration started in 2025 and is predicted to proceed by 2026.
In 2027, the EU will launch the brand new Emissions Buying and selling Scheme (ETS2), extending carbon pricing to heating fuels. It will elevate gasoline costs throughout Europe. The German shopper organisation Verbraucherzentrale calculated {that a} typical family gasoline boiler in a single residence may incur €9,500 in carbon prices for 20 years. The EU’s Social Local weather Fund, financed by ETS2 revenues, may help warmth pump adoption and socially buffer the fee for change.
Power-independent housing additionally helps the development. France’s RE2020 normal promotes practically zero-energy or energy-positive houses, the place environment friendly heating, rooftop PV and insulation complement one another. Rethinking district heating brings change on the communal stage, like in Copenhagen or Stockholm, the place it contains very giant warmth pumps and huge reservoirs to retailer warmth seasonally. This seasonal warmth storage can steadiness seasonal variations in renewable power manufacturing. Munich, Mannheim, Cologne and smaller cities in Germany that launched communal warmth planning have all adopted that mannequin as a part of a technique to turn out to be carbon impartial by 2045.
The views and opinions on this article don’t essentially replicate these of the Heinrich-Böll-Stiftung European Union.
This text was first revealed on eu.boell.org.
