After two years of declining sales, Europe’s heat pump market is back on the rise.
In 2025, around 2.9 million domestic heat pumps were sold across 21 European countries, a 13% increase compared to 2024. This is because many governments started lowering taxes on electricity and on heat pumps.
Heat pump sales surged in 2022 as gas prices spiked following Russia’s invasion of Ukraine. As energy prices eased and some countries reduced support schemes, sales fell in 2023 and 2024. The market rebounded in 2025 thanks to stronger incentives and lower electricity taxes in several countries.
Making electricity more affordable is key. In many European countries, electricity is still taxed far more heavily than gas, even though heat pumps work best when electricity prices stay close to gas prices. Countries with fairer energy taxation consistently see stronger heat pump markets.
The EU is now putting electrification at the heart of its energy strategy. Through its Electrification Action Plan, the European Commission has committed to improving the electricity-to-gas price ratio, with a target of reducing national ratios to 2.5 for households and 2.0 for industry by 2030.
Combined with reforms to energy taxation, the phase-out of fossil fuel subsidies and support for heat pump financing, these measures could significantly boost heat pump deployment across Europe.
More heat pumps also mean greater energy security. The 29.3 million heat pumps now installed across the 21 countries avoid around 25 billion cubic metres of gas imports every year, saving an estimated €9.7 billion annually and reducing Europe’s reliance on imported fossil fuels. Together, they provide the equivalent heat of more than 200 LNG cargo ships, reducing Europe’s reliance on imported fossil fuels.
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