Heat Pumps Market Size to Reach USD 129.0 Billion by 2033

The global heat pumps market size reached USD 64.2 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 129.0 Billion by 2033, exhibiting a growth rate (CAGR) of 8.1% during 2025-2033.

In 2025, the market for heat pumps is on a fast track as residential consumers, companies, and government officials increasingly adopt them as the greener alternative to heating and cooling. Heat pumps actually move heat from one place to another, so they are more efficient than older heating furnaces or air conditioners. With electric systems being decarbonized and climate goals becoming more urgent, heat pump usage is replacing gas and oil installations, whether building, commercial, or industrial.

Electrification and decarbonization are the biggest 2025 end-user trends. Most markets have economic incentives, rebates, and priority tariff schemes in place to encourage heat pump installation. With increasing numbers of electricity grids being powered by renewable sources of energy, heat pump installations thus also pose as an available low-carbon solution to HVAC. Another such hybrid technology is a combination of heat pumps with either gas or solar backup, which similarly enables a seamless transition for dwellings while still having the assurance of a steady heating source during cold periods.

Technological improvements are optimizing system performance and worth. New heat pumps include variable-speed compressors, intelligent thermostats, and low-global-warming-potential refrigerants. New ductless mini-splits allow for installation in existing buildings with minimal retrofitting, and air-to-water and ground-source heat pumps offer the possibility to combine with radiant floors and hydronic systems to deliver quieter, more uniform comfort.

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Higher energy costs and consumers' desire for lower utility bills remain firm drivers of the market. The high efficiency of heat pumps creates immediate monthly savings, making the investment cost more desirable. Energy performance labeling, honest payback calculation, and warranty by the manufacturer also enhance customer confidence and make the buying decision simpler.

Regional trends are propelling market growth. In North America and Europe, new building codes require or encourage heat pumps. Urbanization and rising incomes in the Asia-Pacific and Latin America are fueling demand, especially in areas where temperatures are increasingly variable and both cooling and heating are required.

Installer networks and readiness to labor are also critical to market expansion. Training programs and certification programs give installers confidence to properly size and service systems as demand rises, driving performance and customer satisfaction. Financing options like on-bill financing or energy-as-a-service provisions help consumers get past upfront costs.

In total, the 2025 market for heat pumps demonstrates a clear direction towards sustainable electrified heating and cooling. Technology will keep evolving, regulation will keep improving, and perception of long-term benefit will grow stronger, and heat pumps will be a mass-market technology solution for climate-friendly efficient home and business space heating and cooling worldwide.

Heat Pumps Market Report with Complete TOCs

Market Segmentation:

Breakup by Rated Capacity:

• Up to 10 kW
• 10–20 kW
• 20–30 kW
• Above 30 kW

Breakup by Product Type:

• Air Source Heat Pump
• Ground Source Heat Pump
• Water Source Heat Pump
• Exhaust Air Heat Pump
• Others

Breakup by End Use Sector:

• Residential
• Commercial
• Hospitality
• Retail
• Education
• Food & Beverage
• Paper & Pulp
• Chemicals & Petrochemicals
• Others

Regional Analysis:

• North America
• Europe
• Asia Pacific
• Middle East and Africa
• Latin America

Who are the key players operating in the industry?

The report covers the major market players including:

• Daikin Industries, Ltd.,
• Mitsubishi Electric Corporation,
• MIDEA GROUP,
• NIBE Industrier AB, Corp.,
• Ingersoll Rand,
• Danfoss,
• Panasonic Corporation,
• GDC Group Limited,
• Viessmann Manufacturing Company Inc.,
• Robert Bosch GmbH,
• United Technologies Corporation, etc.

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