Munich, July 10, 2025 – Heat pumps are a crucial piece of the energy transition puzzle. But for their enormous potential to be leveraged, it must first be understood. This is the finding of gridX’s latest Heat Pump Report, which analyzes the progress in Europe’s heat pump installations and presents simulation results showing potential savings in German households by combining a heat pump with a home energy management system (HEMS). Although heat pump numbers experienced a notable downturn in Europe in 2024, renewed vigor due to stronger incentives and subsidies and technological advancements in heat pump integration and optimization, combined with growing public awareness, mean that long-term goals are still attainable.
The Nordics lead per capita, the UK is the only country to increase sales
Every European country experienced a slowdown in heat pump installations in 2024 except one: the United Kingdom, which increased its year-on-year number of installations from 2023 by 63 percent. Germany, on the other hand, saw a 46 percent decline in heat pump sales, primarily due to policy uncertainty. Industry experts view this dip not as a setback, but rather a market correction following years of exceptional growth. “After crisis-driven spikes and subsidy-related fluctuations in the recent past, the German heat pump market is currently showing signs of stabilization,” says Markus A.W. Hoehner, Founder and Managing Director of EUPD Research Sustainable Management GmbH. “There are cautious signs of sustainable market development, even if future prospects still depend on various framework conditions,” he adds.
The Nordics led heat pump adoption per capita in 2024, largely due to favorable financial incentives, with 24.5 units per 1,000 inhabitants sold in Norway, followed by 17.8 in Finland and 9.1 in Sweden. Despite its positive growth curve, the United Kingdom still appeared at the bottom of the 14-country list with just 1.4 heat pumps per 1,000 people sold in 2024, showing they still have a lot of room for growth.
Smart electric heating can reduce heating costs by 1,390 euros or 60 percent
The key to unlocking heat pumps’ full potential lies in integration with the power grid and other energy assets, and their holistic optimization. gridX conducted a detailed simulation with RWTH Aachen University to calculate the average annual savings of German households via intelligent heat pump optimization in the home. The study found that if an old German home with a photovoltaic (PV) system replaces its oil-based heater with an air-to-water heat pump with an advanced HEMS, annual heating costs can be reduced by 1,390 euros, or 60 percent. Dynamic tariffs and an advanced home energy management system that combines solar heating, dynamic tariff optimization and compliance to Paragraph 14a is responsible for 830 euros of these savings. A modern home built in 2016 could reduce its annual heating costs by 510 euros, with the potential to even reduce these costs to zero.
Ready for gridX expands its focus to help homeowners leverage this potential
To ensure that the growing number of heat pumps helps, rather than hinders, grid stability, a successful heating transition will rely on fast and future-proof compatibility to energy management systems. gridX’s end-to-end partnership program with leading manufacturers, Ready for gridX, – which has until now focused on battery and inverter manufacturers – is being extended to heat pumps. According to gridX CTO and Co-Managing Director, Tobias Mitter, such partnerships that enable seamless interoperability between all energy devices in the homes and unlock more advanced use cases is the key to maximizing savings for end users and guaranteeing long-term growth in heat pump installations. “As Europe’s power grids face increasingly greater challenges due to the growing share of renewables, intelligent heat pump control is not just a nice-to-have, it’s a necessity,” concludes Mitter.
Download the full report here.
gridX is Europe's leading smart energy company based in Aachen and Munich. With its modular EMS XENON, gridX enables manufacturer-independent optimization and management of distributed energy resources. With XENON, partners can build, scale and adapt energy management solutions faster and more efficiently than ever before, always meeting evolving market demands. E-mobility partners can install more and higher power charge points at sites without the need for costly grid extensions. Partners in home energy management minimize costs and complexity by offering end customers holistic smart energy management built for the future.
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