Why Heat Pump Sales in Germany Skyrocketed in 2022

Germans have enjoyed the advantages of using cheap gas from their Russian neighbors for nearly a hundred years now, but the situation has sharply reversed within a few months. Now, Germans face sky-high prices, making their search for alternative heating sources a tactical and strategic emergency.

This is where the heat pump comes in. Heat pumps have been around in one form or another since the 1970s, but they have suddenly become highly popular in German homes and industries. Buying a heat pump in Germany today typically involves long waiting periods as they are often sold out, and finding a qualified installer with the time to visit your home or business can take months due to their busy schedules.

The German government, in general, and the European Union have put their weight behind heat pump technology, citing that it is a cheaper, greener, safer, and more sustainable solution for our growing energy needs. Over the past two years, heat pump sales have doubled in Germany, with many other EU members reporting similar growth numbers.

Let’s look closer at heat pumps in general and the factors driving their unprecedented popularity in Germany recently. 

What are Heat Pumps?

Heat pumps provide heating energy by drawing air using large, powerful fans from the outside and moving it past tubes containing refrigerants. In this way, they can draw warmth from the environment and funnel it into your industrial, commercial, or residential property depending on the size of the unit.

Some heat pumps draw heat from outside air while some draw it from underground, but both systems use minimal electricity to perform the same heating tasks that traditional thermal boilers and furnaces accomplish using fossil fuels such as coal and gas. They offer a cleaner, cheaper, and more efficient heating alternative.

Factors Driving the Popularity of Heat Pumps in Germany

As any economist will admit, understanding the mechanics of supply and demand is as much a science as an art. Germany’s current appetite for heat pumps has myriad forces fueling it, but certain factors stand out. These include the following:

Loss of Russian Gas Imports

The war in Ukraine has been a catastrophic development not only for the countries directly involved but also for their neighbors and friends. The ramifications of the supply disruptions caused by the conflict have sent global shockwaves. Ukraine, perhaps the world’s largest wheat exporter, has been unable to keep up its exports, placing many second and third-world countries at risk of food uncertainty. 

More relevant to the topic, Russia, one of the world’s largest natural gas exporters, has ceased exporting these natural resources to countries backing Ukraine in their conflict, including most of the European Union member states.

As we mentioned earlier, Germany has long relied on Russian natural gas to quench the gas needs of its industries and people. The gas shortage resulted in energy prices almost doubling in Germany, with prices seeing similarly significant increases worldwide.

Even though Germany’s gas storage facilities were at total capacity at the war’s beginning, the prospect of a long, bitter winter was a heavy burden on its conscience. Some quarters suggested that thousands of people, especially the elderly, would lose their lives in a prolonged winter if the gas they relied on to heat their homes were unavailable or too expensive. For this reason, many homeowners and industrial facilities chose to switch to heat pumps in 2022 and end their reliance on Russian natural gas.

Skyrocketing Gas Prices Worldwide

This point might repeat our first, but the economic forces behind the heat pump switch are worth reiterating. Even though installing heat pumps might be expensive initially, it translates to significant cost savings.

According to a paper published by the International Energy Agency (IEA), if the EU switched to heat pumps for its industrial, commercial, and domestic heating and cooling needs, the union would cumulatively shave approximately 60 billion Euros off its annual natural gas bill. At a time when we’re all facing economic constraints and unprecedented rates of inflation across the globe, any measures designed to save us money are going to be popular. 

EU Greenhouse Mandates and Policies

As the European Union seeks ways to limit or entirely dispense with its reliance on Russian natural gas imports for its energy needs while simultaneously trying to become more eco-friendly, heat pumps are the best alternative currently on the table. EU industrial facilities are thought to be responsible for more than 25 percent of the union’s total carbon emissions.

Finding a way to reduce this environmental impact while saving money and cutting off its disadvantageous reliance on Russia is a prospect that the EU has decided to support with official legislative action. 

In the eyes of EU legislators, heat pumps are the future of the bloc’s green energy needs. The REPowerEU initiative, which aims to reduce approximately half of the 150 million boilers being used in member states with heat pumps by 2030, is the flagship initiative driving the shift towards heat pumps not only in Germany but in all EU member states.

This push involves other measures such as installing better insulation, utilizing recycled materials, writing eco-friendly housing legislation, etc.

Increased Climate Responsibility and Awareness

The IEA (International Energy Agency) has conducted studies indicating that heat pumps are three to five times less wasteful than gas furnaces. In cases where they are powered by green energy sources such as wind, solar, hydropower, or waste heat sources, they have virtually zero emissions.

This outstanding eco-friendliness has made heat pumps a star in the world of environmental conservation. This is becoming increasingly relevant as people wake up to the real dangers of climate change and the deterioration of our environment.

Quieter and Less Obtrusive Operation

One of the largest obstacles in the path of people who would otherwise have been open to switching to heat pumps has been the amount of noise they make. Old-school heat pumps made an inordinate amount of noise, which might have been tolerable in industrial settings, but posed a challenge for people who lived in residential areas or commercial settings with shared spaces. 

German legislation has strict guidelines regarding noise pollution, and heat pumps have been the source of numerous legal conflicts between neighbors regarding the noise pollution brought about by the constant hum of the large machines. In recent times, however, heat pump manufacturers have made their machines as quiet as possible. 

Their efforts have borne fruit, as the latest generations of heat pumps are the quietest ever. Companies such as SPRSUN Heat Pumps are at the forefront of noise-canceling innovations. These innovations range from altering the blade angles in their heat pump fans to cutting notches into the blades - all tested in dedicated acoustic rooms to gauge their noise levels. 

Government Subsidies and Protocols

As part of the German government’s efforts to encourage the uptake of heat pumps, they have put subsidies that work by reducing the upfront prices people and companies have to pay for a heat pump. Prices per unit and installation costs have been some of the main points holding people back from changing from fossil fuels to heat pumps. This is especially true for smaller companies and individual homeowners who might not have the financial muscle to make such significant investments without financial backing. 

The German authorities offer subsidies of up to 60,000 Euros when they invest in more efficient alternative energy sources such as heat pumps, solar power, etc. However, the German subsidy program is not a matter of simple necessity, as countries such as the Netherlands and Finland, which enjoy their own considerable natural gas reserves, made the same call for eco-friendly alternatives many years ago.

Final Thoughts

Heat pumps in Germany and the wider European Union are seen by many as the energy solution of the future. Because of the reasons we’ve outlined above and perhaps more besides, heat pumps might provide solutions to various social, economic, and environmental challenges facing continental Europe. Even so, there are significant challenges in the face of the successful adoption of heat pumps and similar alternative energy sources in Germany.

One major challenge facing the heat pump industry in Germany is the need for qualified installation experts. Installing these machines is an exceedingly complicated and intricate process compared to gas furnaces. Another issue is the noise pollution aspect of their operation, which has improved considerably in recent times but still needs to be worked on if the technology is to continue its recent trajectory of success. 

According to Robert Habeck, Germany’s Minister for the Economy, the goal is to have 6 million German customers use heat pumps for their heating needs by 2030. If recent trends are anything to go by, the country may be on its way to achieving this target. As Germany, Europe, and the world seek out more eco-friendly, efficient, and cost-effective alternative energy solutions in the future, we can expect to see more growth in the global heat pump industry.