At the end of 2024, we issued a Report into the UK Heat Pump Market which threw up some interesting stats as well as some predictable headlines.
‘Heat Pumps – the Financial Tipping Point’ looked at the barriers to growth in heat pump sales as well as the opportunities that can be capitalised on. It focused predominantly on air to water heat pumps as this is currently what the ‘general public’ perceive as a ‘heat pump’.
The UK has a legally binding target of reaching net zero carbon emissions by 2050, and an ambitious target of installing 600,000 heat pumps per year by 2028 – which we are a long way from. However, ongoing misconceptions and a lack of understanding about renewable heating are hampering uptake from homeowners.
One thing is certain – the renewable heating market is set to expand rapidly over the next five years
Ben Bartle-Ross Technical trainer at Mitsubishi Electric
Commercial opportunities
At the same time, the commercial sector is making huge strides in the uptake of heat pumps for two predominant reasons.
Firstly, the Public Sector Decarbonisation Fund, otherwise known as Salix Funding. This is limited in how much budget is available each year, but over the last few years, it has quietly allowed hundreds of public sector buildings across the land to remove gas and install renewable, sustainable heating.
The other thing that is driving the commercial sector away from gas towards heat pumps is global finance, which is refusing to invest in new-build or even retrofit projects that cannot show how sustainable they are.
Commercial sales were estimated to be just under 2,000 units last year, but each year there are over 30,000 heat generating products sold into the commercial market.
So, the opportunity for growth is phenomenal.
100,000 residential installs
The same is true of the residential sector as 2025 may well be the first year that it breaks through the 100,000 installs in a year.
Yet there are still over 1.4 million gas boilers sold domestically, so there is quite some way to go!
While the research from our ‘Tipping Point’ Report confirms that businesses are ahead of homes in adopting renewable heating, it’s surprising that 36% of heating installers currently don't see the financial benefits of learning to install a heat pump, whether for the domestic or commercial sector.
The Report also shows that 8 out of 10 homeowners are still using gas, and whilst the survey reveals almost half of UK consumers want to buy low-carbon heating solutions, 73% still feel that they don't know enough to make an informed purchase.
Three key steps
Importantly, the Tipping Point Report identifies three key steps that Government could do to help drive the adoption of heat pumps
1) Balance – Government needs to deal with what is known as the ‘Spark gap’ which currently sees an significant imbalance between gas and electricity prices
2) Consistency – Setting consistent, actionable standards for the decarbonisation of all types of buildings would enable a phased approach to retrofit and help tackle this challenge, turning it into a real opportunity
3) Certainty – Raising energy efficient building standards will provide clarity on how new buildings must be fitted for low carbon heating
The coming months will see the Government make important decisions on the Carbon Budget, the Future Homes Standard, and the Future Building Standard but the direction of travel is clear for all to see. We are very near the end of gas as the dominant form of heating for both homes and businesses.
So, whether you are already involved in installing heat pumps either commercially or residentially, one thing is certain – the UK market is set to expand rapidly over the next five years, offering a significant opportunity for growth.
If you’d like to know more and see what training is available, visit our training page.
Ben Bartle-Ross is a technical trainer at Mitsubishi Electric
