Report Description

Forecast Period


Market Size (2022)

USD 160.11 billion

CAGR (2023-2028)


Fastest Growing Segment


Largest Market


Market Overview

Global District Heating Market was valued at USD 160.11 billion in 2022 and is anticipated to project robust growth in the forecast period with a CAGR of 4.0%through 2028. On the bright side, renewable energy sources have gained the upper hand in energy production during the lockdown period. As per the study conducted by the International Renewable Energy Agency (IRENA) on the impact of COVID-19 on the renewable energy sector, the existing renewable energy projects in operation have witnessed higher utilization rates than ever before. In Europe, during the first quarter of 2020, renewables accounted for 41% of total energy production, which indicates an increase of 16% compared to the first quarter of previous years.The COVID-19 crisis has considerably affected the entire power sector across the world. Throughout the COVID-19 pandemic, several countries have imposed nationwide lockdowns to prevent the further spread of the deadly virus, which has interrupted many activities, including construction, new infrastructure development, installation of turbines, and others. This resulted in government organizations and personal corporations concerned about the construction of heating networks delaying many District Heating projects due to the inaccessibility of the workforce to complete the project in an exceedingly specified time along with disruptions in supply chains due to travel bans across several states and countries. India has pushed sooner than the deadlines for the 3GW star installation. This can damage future investments in heating networks as the economies of assorted countries face a rough patch.

Key Market Drivers

Rising Need to Diminish the Carbon Emission will Augment Growth in the Market

Population across the globe has risen at an exponential rate in recent years, which led to increased urbanization being witnessed across different regions. This has directly increased the demand for energy from various end-use sectors. District heating is capable of producing a large amount of energy at a central plant, and further transmitting it to different end-use industries acts as an effective solution for sufficing the heat demand.The world is struggling with threats due to unprecedented carbon emissions and global warming, resulting in an increased inclination toward renewable energy resources. The U.K. has proclaimed an incentive package of USD 2 billion investment for the heating sector from 2015-to 2025. Germany has announced an investment of around 1 billion by 2030. Similar packages are expected in Denmark, Netherlands, and China in the coming years. Poland has broadcasted an investment of USD 5 billion from 2018 to 2028 in the heating sector.

Flexibility in the Source of Heat Generation and Cost-effectiveness to Propel Growth

District heating provides the choice of heat generation using numerous sources such as coal, renewables, gas, oil & crude product, and alternative accessible sources. Recent trends witnessed renewables and gas to be progressively employed in district heating systems as these resources directly facilitate reducing gas emissions and serve in achieving energy targets. These operational advantages will drive the district heating market growth in the coming years.

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