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Felicity Bradstock

Felicity Bradstock

Felicity Bradstock is a freelance writer specialising in Energy and Finance. She has a Master’s in International Development from the University of Birmingham, UK.

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Are Heat Pumps the Future of Residential and Commercial Heating?

  • Heat pumps offer a net-zero heating and cooling solution, powered by electricity from renewable sources.
  • Governments worldwide are phasing out gas boilers and introducing incentives to promote the adoption of heat pumps.
  • Companies are investing in heat pump manufacturing to meet the growing demand for this clean energy technology.
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Heat pumps are hotting up as governments worldwide search for alternatives to gas boilers. They can both warm and cool buildings and are powered by electricity, rather than fossil fuels, helping to decarbonise homes and offices. Governments worldwide are beginning to invest heavily in the technology as they strive to trade old boilers out for innovative heat pump technology to support a green transition.

We have long relied on fossil fuels to heat residential and office buildings. Most boilers continue to be powered by natural gas, which contributes to the release of CO2 into the atmosphere. However, several companies around the globe are now offering alternative heat pump technology that can be powered using electricity from renewable sources to provide net-zero heating and cooling. 

Heat pumps work similarly to refrigerators and air conditioning systems, extracting heat from a source, such as the surrounding air, geothermal energy stored in the ground, or nearby sources of water or waste heat from a factory. It intensifies the heat and transfers it to wherever it is needed. As heat pumps transfer rather than produce heat, they are far more efficient than other heating technologies, resulting in lower energy bills. They consist of a compressor, which moves a refrigerant through a refrigeration cycle, and a heat exchanger, which extracts heat from the source. Heat is delivered using either forced air or hydronic systems, such as radiators or under?floor heating. They can also be used with a tank to provide hot water. To cool, the pump reroutes indoor heat outdoors.

One of the main challenges to the wide-scale rollout of heat pumps is the threat of overburdening the grid. In many countries, the current electrical infrastructure is outdated and insufficient in capacity to link new renewable energy projects to homes and businesses. Many electric grids were developed around energy hubs, which were largely fuelled by coal, oil, and gas. As companies develop renewable energy projects in atypical energy regions, new transmission infrastructure will be required to connect this energy to the grid. However, in many cases, this means a complete overhaul, costing a great deal of time and money. Therefore, in most places, it is not yet possible to introduce a countrywide shift from gas boilers to heat pumps. Several governments have, therefore, announced a gradual phasing out of boilers in favour of cleaner alternatives over the coming decades. 

Companies have been able to improve heat pump technology significantly in recent years thanks to greater support from governments worldwide and financial incentives to decarbonise. In the U.S., consumers are being offered attractive tax credits and rebates to buy and install heat pump systems. This has encouraged unlikely players to invest heavily in heat pump technology. Carrier Global, whose founder invented air conditioning, is betting big on heat pumps. Last April, Carrier acquired the German heat pump company Viessmann Climate Solutions for around $13 billion. David Gitlin, the CEO of Carrier Global, stated “We all know that sustainability is a megatrend… HVAC has to have a critical seat at the table.”

Carrier’s chief technology and sustainability officer, Hakan Yilmaz, explained, “HVAC is at an inflexion point right now, with a tremendous shift toward electrification, going from fossil fuel-burning boilers and furnaces to heat pumps.” Yilmaz added, “In addition, the cooling side of HVAC is expected to triple by 2050 because 2.8 billion people live in hot climate zones and only about 8 percent have access to HVAC today.” 

The International Energy Agency (IEA) sees heat pump technology as key to progressing a global green transition. An IEA report on the potential for heat pump usage in China highlights the country’s ongoing reliance on coal for its heating needs. In Chinese industries, heat consumption increased by 13 percent between 2010 and 2022. In addition, heat provision accounts for 40 precent of China’s CO2 emissions and coal use. The use of heat pumps is becoming more commonplace in China, with the technology accounting for eight precent of heating equipment sales for buildings in 2022. China is the biggest manufacturer of decentralised heat pumps for buildings and can increase production to support the commercial rollout of the systems to significantly reduce carbon emissions in the coming years. 

In the U.K., applications for heat pump grants have risen sharply in the last year, with new applications for grants increasing by 75 percent in February, compared to the same month last year. The government introduced its Boiler Upgrade Scheme two years ago, aimed at decarbonising heating. Lord Callanan, Minister for Energy Efficiency and Green Finance, stated, “Demand for heat pumps is soaring, as we make it easier than ever to make the switch to electric heating without big upfront costs… Our boosted £7,500 grants are helping people create a warm home and lower their emissions. And with applications up 75%, it’s clear our approach is hugely popular with many families.” By the end of February, there had been 35,741 applications and a total pay-out of around £127 million in vouchers to customers.

Thanks to significant improvements in heat pump technology in recent years, interest in the technology is increasing. Governments are spending more on the technology and more companies are investing in manufacturing projects, supported by financial incentives, such as tax breaks and grants. Several countries are planning to make the shift from gas boilers to renewable-electricity heat pumps in the coming decades to help decarbonise heating. However, to achieve this, governments must invest heavily in making improvements to their grid systems to ensure the necessary infrastructure is in place to deliver clean energy to houses and businesses countrywide.

By Felicity Bradstock for Oilprice.com 

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