Heat Pump Market and scenarios in Finland

Jussi Hirvonen

RAPID GROWTH?

- The cumulative number of heat pumps in Finland reached a total of 670,000 in 2014. - They are already extracting 5 TWh/a of RES local renewable energy from the ground,

the rock or the air from around the houses - Finns are already investing 400 million Euros a year in heat pumps - 2030: 12 billion euros invested in heat pump systems and 22 TWh/a

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Air to Air HP

Air to Water HP

Exhaust HP

Ground Source HP

Annual Heat Pump installations Number of installations increasing annually by 60 000 units

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Ground Source Air-Water Exhaust Air Air-Air

Annual Heat Pump investments Private end-users are investing 350 M€ annually

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Ground Source Air-Water Exhaust Air Air-Air

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Average investment 2013: GSHP 20.000€, AWHP 11.000€, EAHP 7.000€, AAHP 1.800€

Finnish Heat Pump investments totalling 3 billion € Ground Source 1850 M€, Air-Water 90 M€, Exhaust Air 160 M€ ja Air-Air 800 M€

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Ground Source Air-Water Exhaust Air Air-Air

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Average investment 2013: GSHP 20.000€, AWHP 11.000€, EAHP 7.000€, AAHP 1.800€

What we reach today with our 700.000 HP stock?

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TWh of Renewable Energy annually

M€ improvement in Trade Balance annually

jobs annually

M€ of private investments annually

% Return on Invested Capital

million tons in decreased CO2-emissions annually

Heat Pumps have become the most popular main heating source in new built houses

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1995 2000 2005 2010 2015

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Ground Source Heat Pumps Exhaust Air Heat PumpsDistrict Heating and Biofuels Direct ElectricityElectricity and Hydronic Circulation Oil Heating

Heating replacement market

Today • 200 000 oil boilers • 100 000 other hydronic systems

(electricity, wood) • 500 000 direct electricity systems • 500 000 summer houses • 100 000 buildings outside District Heating

networks

A potential of 1,4 million projects for • Heat Pumps • Biofuels • District Heating

Finland has the best potential for Heat Pumps in Europe

• Cold climate and a large country (338 000 km2)

• Small number of inhabitants (5,4 million)

• High energy consumption for heating (120 TWh/a)

• Best drilling conditions in Europe

Location Infrastructure Prices

• No extensive gas network

• District Heating only in cities and mostly for large buildings

• Wrongly heated houses • 220 000 oil boilers • 100 000 with electric

heating and hydronic circulation

• 500 000 with direct electricity

• 10 000 new built houses annually

• Fossil fuel prices rising and technology prices decreasing

• Heating prices • electricity 12-13 c/kWh • oil 13-17 c/kWh • pellets 5-7 c/kWh • district heating 6-15 c/kWh

• Heat Pumps generate heat at price level 3-6 c/kWh

External Driving Forces Heat Pumps will have a significant role in meeting future energy challenges

Oil price

Taxation

Emissions

Russia

Consumer prices for Heating Oil remains high

Tax increases on fossil fuels and electricity will continue

Directives, construction rules and support policies are driving towards lower emissions and higher energy efficiency

Desire to decrease dependency on imported energy

Economy Trade Balance has to be improved

Business Environment and Communication Challenges in the Heat Pump Sector

Developing the business environment

Communication

Research and Development

• Studies and reports having significance and impact • Co-operation with other associations and interest groups • Influencing law makers and Public Authorities

• The role of Heat Pumps in achieving RES goals • Significant benefits for end-users and the whole society

• Energy efficiency in construction and renovations (E-number, nZEB) • Future Heat Pump Systems must meet changing external demands • Starting and financing research projects (FIN, IEA HPP, EU)

Technology and Quality Challenges in the Heat Pump Sector

System quality

Quality of operations

Challenges in education

• Dimensioning and planning • Quality of Heat Pumps and related devices • Guarantees and Service

• Information sharing, marketing and sales • Contracts • Installation, taking into operation, educating end-users

• Slow development of education programs • 200 000 installation days in 2014 • So far the Finnish education system haven't produced any

Heat Pump technicians or installers

Scenario from HP market study 2030 by Gaia Consulting Oy

New buildings and replacements GSPHs, AAHPs, AWHPs, Exhaust HPs Gross production (RES/Energy saving)

2014: 6 TWh/a (4 TWh/a) 2020: 12 TWh/a (8 TWh/a) 2030: 22 TWh/a (15 TWh/a)

Cumulative investments: By 2020: 4 billion € By 2030: 12 billion € – Consumer prices – Without subsidies

Influences in CO2, employment, trade balance, economy of the state etc.

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Lukumäärän kehittyminen

MLP ILP UVLP PILP

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Kumulatiivinen liikevaihto

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Some renewable energy figures in Finland 2014

Solar energy 0.01 TWh/a (10 MW)

Wind 1 TWh/a ( 260 mills, 627 MW)

Heat Pumps 5 TWh/a (700.000 HPs)

Wood in furnaces 10 TWh/a ( 2 million furnaces)

Finland total 300 TWh/a Electricity 84 TWh/a

Europe: 7 million Heat Pumps

FR, DE, IT, SE the biggest markets ?

Finland has passed Sweden, passing Norway?

18

Winner of the Heat Pump City of the Year 2015 City of Mäntsälä, Finland The project is a good example of successful

multi-partnership: the city of Mäntsälä, Yandex datacenter and Calefa.

40 C waste energy to 100 C District Heating by Heat Pump (4 MW)

The project aims to heat 4000 households. The overall annual carbon savings of 11 000t

CO2

EHPA Heat Pump City of the Year Award 27-05-2015

The Biggest Heat Pump Project

100 kilometers drill hole as a heat source and storage

Heat Pump – fantastic equipment