The global geothermal heat pumps market is projected to be valued at USD 241.52 billion in 2025. According to Fact.MR, the market is anticipated to expand at a CAGR of 13.1%, reaching USD 827.14 billion by 2035.
In 2024, the industry witnessed notable growth driven by favorable government incentives, rising emphasis on sustainable heating and cooling technologies, and large-scale infrastructure projects, particularly across Europe and North America. The implementation of updated building codes mandating energy-efficient HVAC systems further accelerated the adoption of geothermal heat pumps, especially in residential and commercial real estate sectors.
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Country-wise Insights
In the United States, the geothermal heat pumps market is expected to grow at a CAGR of 11.1% over the forecast period. This growth is largely fueled by robust federal and state-level incentives, such as the Investment Tax Credit (ITC) for renewable heating solutions. The Inflation Reduction Act has further accelerated investment in green technologies, fostering a favorable environment for the adoption of sustainable heating and cooling systems. Additionally, increasing consumer awareness around energy efficiency, carbon footprint reduction, and long-term cost savings is driving demand across both residential and commercial applications.
Geothermal heat pump sales in the UK are projected to grow at a CAGR of 5.2% during the assessment period. While growth is steady, it remains moderate due to high initial installation costs and limited consumer awareness. However, key policy initiatives such as the Future Homes Standard and the planned ban on gas boilers by 2035 are set to play a pivotal role in accelerating the shift toward low-carbon heating technologies. These regulatory changes are expected to drive increased adoption in the coming years, particularly in new residential developments.
In Germany, the sustainable heating market—particularly for geothermal heat pumps—is projected to grow at a CAGR of 10.6% from 2025 to 2035. This strong growth is driven by the country’s ambitious targets under the Building Energy Act (GEG), which mandates that all new heating systems must rely on renewable energy. Further boosting adoption, the Federal Funding for Efficient Buildings (BEG) program provides generous subsidies of up to 40% for eligible installations, making geothermal systems increasingly attractive for both homeowners and commercial developers.
Key Players
- Viessmann Group
- ClimateMaster, Inc.
- Dandelion Energy
- Stiebel Eltron GmbH & Co. KG
- Vaillant Group
- Bard Manufacturing Company, Inc.
- Danfoss Group
- Enertech Global, LLC
- Bryant Heating & Cooling Systems
- Modine Manufacturing Company
Competitive Landscape
The geothermal heat pumps market is moderately consolidated, dominated by key global players alongside a rising number of innovative regional manufacturers. Major companies such as Carrier, Trane, Bosch, and NIBE Group continue to lead the global landscape. However, competition is intensifying with the emergence of agile startups and localized expertise, particularly in Europe and North America.
To strengthen market presence, leading firms are prioritizing cost-effective solutions, high-efficiency product development, and strategic collaborations. The integration of smart technologies, hybrid systems suited for colder climates, and alignment with national clean energy initiatives are emerging as key competitive advantages. Additionally, companies are investing in expanding their service infrastructure and forming cross-sector partnerships to tap into the growing demand for residential and institutional retrofits.
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Geothermal Heat Pumps Market Segmentation
- By Technology :
- Open Loop Systems
- Closed Loop Systems
- By End User :
- By Region :
- North America
- Latin America
- Europe
- East Asia
- South Asia
- Oceania
- Middle East and Africa (MEA)
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