Large-scale Natural Refrigerant Heat Pump Market Size and Outlook 2031

Report Description

Forecast Period	2027-2031
Market Size (2025)	USD 6.58 Billion
CAGR (2026-2031)	7.01%
Fastest Growing Segment	Commercial
Largest Market	Asia Pacific
Market Size (2031)	USD 9.88 Billion

Market Overview

The Global Large-scale Natural Refrigerant Heat Pump Market will grow from USD 6.58 Billion in 2025 to USD 9.88 Billion by 2031 at a 7.01% CAGR. Large-scale natural refrigerant heat pumps are high-capacity thermal management systems that utilize environmentally benign fluids, such as ammonia, carbon dioxide, or hydrocarbons, to generate heat for industrial processes, district heating networks, and large commercial facilities. The market is primarily supported by stringent environmental regulations aimed at phasing out high-global-warming-potential synthetic refrigerants, alongside a global corporate imperative to meet decarbonization targets through electrification. These drivers are reinforced by the technology's superior energy efficiency and ability to recover waste heat, which aligns with sustainability mandates. According to the European Heat Pump Association, in 2024, the operational stock of heat pumps in Europe avoided approximately 45 megatonnes of carbon dioxide emissions, underscoring the critical role these systems play in continental climate strategies.

Despite the favorable regulatory environment, the market faces a significant challenge regarding the substantial upfront capital expenditure required for large-scale installations compared to conventional fossil-fuel combustion systems. This high initial investment, often exacerbated by fluctuating interest rates and complex integration requirements for existing infrastructure, can delay final investment decisions and impede rapid deployment. Consequently, while the operational savings are distinct, the financial barrier to entry remains a hurdle for widespread adoption in cost-sensitive industrial sectors.

Key Market Drivers

Stringent Regulatory Phase-down of High-GWP Synthetic Refrigerants is the primary catalyst forcing industrial operators to transition toward natural refrigerant-based thermal systems. As international frameworks and regional policies aggressively cap the usage of hydrofluorocarbons (HFCs) due to their environmental impact, industries are rapidly retrofitting facilities with ammonia and carbon dioxide solutions to ensure long-term compliance and avoid stranded assets. This regulatory pressure has accelerated the deployment of alternative technologies across the manufacturing sector, effectively making natural refrigerants the standard for future-proofed thermal management. According to ATMOsphere, February 2025, in the '2024 Market Report', the number of industrial sites utilizing transcritical carbon dioxide systems in Europe increased to 4,900 in 2024, demonstrating a rapid departure from legacy synthetic systems in response to these tightening standards.

Global Mandates for Decarbonization of Industrial and District Heating are equally critical, driving the installation of gigawatt-scale thermal projects to replace fossil-fuel boilers in municipal and utility applications. Governments are increasingly prioritizing the electrification of heat networks to meet net-zero targets, necessitating heat pumps capable of delivering high operational temperatures and massive capacities for district heating. A prime example of this scale is the recent commissioning in Denmark; according to MAN Energy Solutions, December 2024, in the 'Mega Heat Pump Delivers First Heat in Esbjerg' press release, the world’s largest CO2-based seawater heat pump commenced operations with a heating capacity of 70 MW, designed to reduce annual carbon emissions by 120,000 tons. This segment's resilience is evident despite broader market fluctuations; according to Exergy ORC, in 2025, reported sales of industrial heat pump units in Europe grew by 12% in 2024, highlighting the sustained demand for large-scale green infrastructure.

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Key Market Challenges

The substantial upfront capital expenditure required for large-scale natural refrigerant heat pumps acts as a distinct restraint on market expansion. Industrial operators often prioritize projects with short payback periods, but the high initial costs of these thermal management systems usually result in longer return on investment timelines compared to traditional gas or oil boilers. This financial disparity makes it difficult for companies to justify the switch, particularly when competing against established fossil-fuel technologies that require significantly lower initial funding. Consequently, final investment decisions are frequently postponed or cancelled as organizations struggle to allocate budget for such capital-intensive infrastructure projects.

These economic hurdles are intensified by fluctuating interest rates and the complex engineering costs associated with retrofitting existing facilities. When the cost of capital rises, the total cost of ownership for green technologies increases disproportionately, further dampening investor confidence. This trend of financial hesitation is evident in recent market performance metrics. According to the European Heat Pump Association, in 2024, total heat pump sales in Europe fell by 6.5 percent in 2023 compared to the previous year, marking the end of a decade of growth largely due to economic uncertainty and delayed investments. This contraction highlights how financial barriers directly reduce deployment rates across the sector.

Key Market Trends

Commercialization of High-Temperature Heat Pumps for Industrial Steam Generation is revolutionizing the chemical and manufacturing sectors by enabling the electrification of process heat requirements that were previously dependent on fossil fuel combustion. This technological advancement allows for the efficient production of steam at temperatures suitable for complex industrial applications, thereby significantly reducing scope 1 emissions. A primary example of this innovation is the deployment at BASF’s Ludwigshafen site; according to PV Magazine, September 2025, in the article 'BASF begins building 50 MW industrial heat pump', the new facility will generate 500,000 metric tons of CO2-free steam annually, creating a blueprint for decarbonizing energy-intensive production lines.

Utilization of Waste Heat from Data Centers and Wastewater Treatment Facilities is rapidly expanding as a strategic trend driven by the surge in computational power demands and the need for circular energy systems. Large-scale heat pumps are increasingly deployed to recover low-grade thermal energy from digital infrastructure and upgrade it for municipal district heating, effectively transforming waste heat into a valuable commodity. This synergy is underscored by recent projections; according to the International Energy Agency, April 2025, in the 'Energy and AI' report, the reuse of excess heat from data centers has the potential to satisfy 300 terawatt-hours of heating demand by 2030, equivalent to 10 percent of Europe's total space heating needs.

Segmental Insights

The Commercial segment represents the fastest-growing category within the Global Large-scale Natural Refrigerant Heat Pump Market, driven by strict environmental mandates and aggressive corporate decarbonization goals. Institutional frameworks, such as the European Union’s F-Gas Regulation, are compelling facility owners in sectors like hospitality, healthcare, and office management to replace high-global warming potential systems with eco-friendly alternatives. Consequently, businesses are actively adopting heat pumps that utilize natural refrigerants like carbon dioxide and hydrocarbons to ensure long-term regulatory compliance, reduce operational risks, and align with green building standards.

Regional Insights

Asia Pacific dominates the Global Large-scale Natural Refrigerant Heat Pump Market, driven by rapid industrial expansion and stringent government mandates to decarbonize heating infrastructure. The region’s leadership is anchored in the widespread adoption of these systems for district heating and industrial processes, particularly within China and Japan. This growth is accelerated by frameworks such as the Action Plan issued by China's National Development and Reform Commission, which prioritizes the transition to natural refrigerants like ammonia and carbon dioxide. Consequently, the combination of policy support and demand for energy-efficient, low-carbon thermal solutions has solidified the region’s market supremacy.

Recent Developments

In February 2025, GEA Group installed a new high-temperature industrial heat pump for a sugar producer in Belgium, utilizing pentane as a natural refrigerant. This installation was part of the EU-funded SPIRIT project and demonstrated a breakthrough in temperature capabilities, with the system designed to upgrade waste heat to temperatures between 135°C and 160°C for steam generation. The pentane-based heat pump allows the facility to decarbonize its production process by replacing fossil fuel boilers, achieving significant reductions in carbon dioxide emissions and validating the viability of natural refrigerants for high-grade industrial heat applications.
In November 2024, MAN Energy Solutions commissioned the first unit of a large-scale seawater heat pump facility in Esbjerg, Denmark, marking a significant milestone in the deployment of natural refrigerant technology. The plant, which uses carbon dioxide as the refrigerant, is the world's largest of its kind and features a total heating capacity of 70 MW. This breakthrough project harnesses thermal energy from the Wadden Sea to provide carbon-neutral district heating for the local municipality, replacing a coal-fired power plant and supplying heat to approximately 25,000 households while ensuring environmental safety through the use of a non-toxic natural refrigerant.
In August 2024, MAN Energy Solutions received an order to supply the world's largest air-to-water heat pump system for a district heating plant in Helsinki, Finland. The commissioned system, which utilizes carbon dioxide as a natural refrigerant in a closed loop, is designed to operate at outdoor temperatures as low as -20° Celsius. With a heating capacity ranging from 20 MW to 33 MW depending on air temperature, this large-scale natural refrigerant heat pump will enable the local energy company to generate climate-neutral heat from ambient air, significantly reducing carbon emissions for approximately 30,000 households.
In March 2024, Johnson Controls expanded its industrial manufacturing facility in Nantes, France, to support the growing demand for large-scale heat pumps. The expansion involved doubling the plant's size with two new buildings, including one dedicated to the assembly of extra-large heat pump units with capacities ranging from 6 MW to 20 MW. This strategic move was designed to enhance the company's production capabilities for district heating and industrial applications, specifically positioning the facility to cater to the rising market for natural refrigerant heat pump technologies in Europe and globally.

Key Market Players

Siemens Energy
Johnson Controls
Emerson Electric Co.
GEA Group Aktiengesellschaft
Mitsubishi Electric Corporation
MAN Energy Solutions SE
Star Refrigeration
Enex Technologies
AGO GmbH Energie + Anlagen
Clade Engineering Systems Ltd.

By Capacity	By Natural Refrigerants	By End Use	By Region
20-200 KW 200-500 KW 500-1 000 KW Above 1 000 KW	Ammonia (R-717) Carbon Dioxide (R-744) Hydrocarbons Other Refrigerants	Commercial Industrial	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Large-scale Natural Refrigerant Heat Pump Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

Large-scale Natural Refrigerant Heat Pump Market, By Capacity:

20-200 KW
200-500 KW
500-1
000 KW
Above 1
000 KW

Large-scale Natural Refrigerant Heat Pump Market, By Natural Refrigerants:

Ammonia (R-717)
Carbon Dioxide (R-744)
Hydrocarbons
Other Refrigerants

Large-scale Natural Refrigerant Heat Pump Market, By End Use:

Commercial
Industrial

Large-scale Natural Refrigerant Heat Pump Market, By Region:

North America

United States
Canada
Mexico

Europe

France
United Kingdom
Italy
Germany
Spain

Asia Pacific

China
India
Japan
Australia
South Korea

South America

Brazil
Argentina
Colombia

Middle East & Africa

South Africa
Saudi Arabia
UAE

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the Global Large-scale Natural Refrigerant Heat Pump Market.

Available Customizations:

Global Large-scale Natural Refrigerant Heat Pump Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

Detailed analysis and profiling of additional market players (up to five).

Global Large-scale Natural Refrigerant Heat Pump Market is an upcoming report to be released soon. If you wish an early delivery of this report or want to confirm the date of release, please contact us at [email protected]

Table of content

1. Product Overview

1.1. Market Definition

1.2. Scope of the Market

1.2.1. Markets Covered

1.2.2. Years Considered for Study

1.2.3. Key Market Segmentations

2. Research Methodology

2.1. Objective of the Study

2.2. Baseline Methodology

2.3. Key Industry Partners

2.4. Major Association and Secondary Sources

2.5. Forecasting Methodology

2.6. Data Triangulation & Validation

2.7. Assumptions and Limitations

3. Executive Summary

3.1. Overview of the Market

3.2. Overview of Key Market Segmentations

3.3. Overview of Key Market Players

3.4. Overview of Key Regions/Countries

3.5. Overview of Market Drivers, Challenges, Trends

4. Voice of Customer

5. Global Large-scale Natural Refrigerant Heat Pump Market Outlook

5.1. Market Size & Forecast

5.1.1. By Value

5.2. Market Share & Forecast

5.2.1. By Capacity (20-200 KW, 200-500 KW, 500-1, 000 KW, Above 1, 000 KW)

5.2.2. By Natural Refrigerants (Ammonia (R-717), Carbon Dioxide (R-744), Hydrocarbons, Other Refrigerants)

5.2.3. By End Use (Commercial, Industrial)

5.2.4. By Region

5.2.5. By Company (2025)

5.3. Market Map

6. North America Large-scale Natural Refrigerant Heat Pump Market Outlook

6.1. Market Size & Forecast

6.1.1. By Value

6.2. Market Share & Forecast

6.2.1. By Capacity

6.2.2. By Natural Refrigerants

6.2.3. By End Use

6.2.4. By Country

6.3. North America: Country Analysis

6.3.1. United States Large-scale Natural Refrigerant Heat Pump Market Outlook

6.3.1.1. Market Size & Forecast

6.3.1.1.1. By Value

6.3.1.2. Market Share & Forecast

6.3.1.2.1. By Capacity

6.3.1.2.2. By Natural Refrigerants

6.3.1.2.3. By End Use

6.3.2. Canada Large-scale Natural Refrigerant Heat Pump Market Outlook

6.3.2.1. Market Size & Forecast

6.3.2.1.1. By Value

6.3.2.2. Market Share & Forecast

6.3.2.2.1. By Capacity

6.3.2.2.2. By Natural Refrigerants

6.3.2.2.3. By End Use

6.3.3. Mexico Large-scale Natural Refrigerant Heat Pump Market Outlook

6.3.3.1. Market Size & Forecast

6.3.3.1.1. By Value

6.3.3.2. Market Share & Forecast

6.3.3.2.1. By Capacity

6.3.3.2.2. By Natural Refrigerants

6.3.3.2.3. By End Use

7. Europe Large-scale Natural Refrigerant Heat Pump Market Outlook

7.1. Market Size & Forecast

7.1.1. By Value

7.2. Market Share & Forecast

7.2.1. By Capacity

7.2.2. By Natural Refrigerants

7.2.3. By End Use

7.2.4. By Country

7.3. Europe: Country Analysis

7.3.1. Germany Large-scale Natural Refrigerant Heat Pump Market Outlook

7.3.1.1. Market Size & Forecast

7.3.1.1.1. By Value

7.3.1.2. Market Share & Forecast

7.3.1.2.1. By Capacity

7.3.1.2.2. By Natural Refrigerants

7.3.1.2.3. By End Use

7.3.2. France Large-scale Natural Refrigerant Heat Pump Market Outlook

7.3.2.1. Market Size & Forecast

7.3.2.1.1. By Value

7.3.2.2. Market Share & Forecast

7.3.2.2.1. By Capacity

7.3.2.2.2. By Natural Refrigerants

7.3.2.2.3. By End Use

7.3.3. United Kingdom Large-scale Natural Refrigerant Heat Pump Market Outlook

7.3.3.1. Market Size & Forecast

7.3.3.1.1. By Value

7.3.3.2. Market Share & Forecast

7.3.3.2.1. By Capacity

7.3.3.2.2. By Natural Refrigerants

7.3.3.2.3. By End Use

7.3.4. Italy Large-scale Natural Refrigerant Heat Pump Market Outlook

7.3.4.1. Market Size & Forecast

7.3.4.1.1. By Value

7.3.4.2. Market Share & Forecast

7.3.4.2.1. By Capacity

7.3.4.2.2. By Natural Refrigerants

7.3.4.2.3. By End Use

7.3.5. Spain Large-scale Natural Refrigerant Heat Pump Market Outlook

7.3.5.1. Market Size & Forecast

7.3.5.1.1. By Value

7.3.5.2. Market Share & Forecast

7.3.5.2.1. By Capacity

7.3.5.2.2. By Natural Refrigerants

7.3.5.2.3. By End Use

8. Asia Pacific Large-scale Natural Refrigerant Heat Pump Market Outlook

8.1. Market Size & Forecast

8.1.1. By Value

8.2. Market Share & Forecast

8.2.1. By Capacity

8.2.2. By Natural Refrigerants

8.2.3. By End Use

8.2.4. By Country

8.3. Asia Pacific: Country Analysis

8.3.1. China Large-scale Natural Refrigerant Heat Pump Market Outlook

8.3.1.1. Market Size & Forecast

8.3.1.1.1. By Value

8.3.1.2. Market Share & Forecast

8.3.1.2.1. By Capacity

8.3.1.2.2. By Natural Refrigerants

8.3.1.2.3. By End Use

8.3.2. India Large-scale Natural Refrigerant Heat Pump Market Outlook

8.3.2.1. Market Size & Forecast

8.3.2.1.1. By Value

8.3.2.2. Market Share & Forecast

8.3.2.2.1. By Capacity

8.3.2.2.2. By Natural Refrigerants

8.3.2.2.3. By End Use

8.3.3. Japan Large-scale Natural Refrigerant Heat Pump Market Outlook

8.3.3.1. Market Size & Forecast

8.3.3.1.1. By Value

8.3.3.2. Market Share & Forecast

8.3.3.2.1. By Capacity

8.3.3.2.2. By Natural Refrigerants

8.3.3.2.3. By End Use

8.3.4. South Korea Large-scale Natural Refrigerant Heat Pump Market Outlook

8.3.4.1. Market Size & Forecast

8.3.4.1.1. By Value

8.3.4.2. Market Share & Forecast

8.3.4.2.1. By Capacity

8.3.4.2.2. By Natural Refrigerants

8.3.4.2.3. By End Use

8.3.5. Australia Large-scale Natural Refrigerant Heat Pump Market Outlook

8.3.5.1. Market Size & Forecast

8.3.5.1.1. By Value

8.3.5.2. Market Share & Forecast

8.3.5.2.1. By Capacity

8.3.5.2.2. By Natural Refrigerants

8.3.5.2.3. By End Use

9. Middle East & Africa Large-scale Natural Refrigerant Heat Pump Market Outlook

9.1. Market Size & Forecast

9.1.1. By Value

9.2. Market Share & Forecast

9.2.1. By Capacity

9.2.2. By Natural Refrigerants

9.2.3. By End Use

9.2.4. By Country

9.3. Middle East & Africa: Country Analysis

9.3.1. Saudi Arabia Large-scale Natural Refrigerant Heat Pump Market Outlook

9.3.1.1. Market Size & Forecast

9.3.1.1.1. By Value

9.3.1.2. Market Share & Forecast

9.3.1.2.1. By Capacity

9.3.1.2.2. By Natural Refrigerants

9.3.1.2.3. By End Use

9.3.2. UAE Large-scale Natural Refrigerant Heat Pump Market Outlook

9.3.2.1. Market Size & Forecast

9.3.2.1.1. By Value

9.3.2.2. Market Share & Forecast

9.3.2.2.1. By Capacity

9.3.2.2.2. By Natural Refrigerants

9.3.2.2.3. By End Use

9.3.3. South Africa Large-scale Natural Refrigerant Heat Pump Market Outlook

9.3.3.1. Market Size & Forecast

9.3.3.1.1. By Value

9.3.3.2. Market Share & Forecast

9.3.3.2.1. By Capacity

9.3.3.2.2. By Natural Refrigerants

9.3.3.2.3. By End Use

10. South America Large-scale Natural Refrigerant Heat Pump Market Outlook

10.1. Market Size & Forecast

10.1.1. By Value

10.2. Market Share & Forecast

10.2.1. By Capacity

10.2.2. By Natural Refrigerants

10.2.3. By End Use

10.2.4. By Country

10.3. South America: Country Analysis

10.3.1. Brazil Large-scale Natural Refrigerant Heat Pump Market Outlook

10.3.1.1. Market Size & Forecast

10.3.1.1.1. By Value

10.3.1.2. Market Share & Forecast

10.3.1.2.1. By Capacity

10.3.1.2.2. By Natural Refrigerants

10.3.1.2.3. By End Use

10.3.2. Colombia Large-scale Natural Refrigerant Heat Pump Market Outlook

10.3.2.1. Market Size & Forecast

10.3.2.1.1. By Value

10.3.2.2. Market Share & Forecast

10.3.2.2.1. By Capacity

10.3.2.2.2. By Natural Refrigerants

10.3.2.2.3. By End Use

10.3.3. Argentina Large-scale Natural Refrigerant Heat Pump Market Outlook

10.3.3.1. Market Size & Forecast

10.3.3.1.1. By Value

10.3.3.2. Market Share & Forecast

10.3.3.2.1. By Capacity

10.3.3.2.2. By Natural Refrigerants

10.3.3.2.3. By End Use

11. Market Dynamics

11.1. Drivers

11.2. Challenges

12. Market Trends & Developments

12.1. Merger & Acquisition (If Any)

12.2. Product Launches (If Any)

12.3. Recent Developments

13. Global Large-scale Natural Refrigerant Heat Pump Market: SWOT Analysis

14. Porter's Five Forces Analysis

14.1. Competition in the Industry

14.2. Potential of New Entrants

14.3. Power of Suppliers

14.4. Power of Customers

14.5. Threat of Substitute Products

15. Competitive Landscape

15.1. Siemens Energy

15.1.1. Business Overview

15.1.2. Products & Services

15.1.3. Recent Developments

15.1.4. Key Personnel

15.1.5. SWOT Analysis

15.2. Johnson Controls

15.3. Emerson Electric Co.

15.4. GEA Group Aktiengesellschaft

15.5. Mitsubishi Electric Corporation

15.6. MAN Energy Solutions SE

15.7. Star Refrigeration

15.8. Enex Technologies

15.9. AGO GmbH Energie + Anlagen

15.10. Clade Engineering Systems Ltd.

16. Strategic Recommendations

17. About Us & Disclaimer

Report Description

Table of content

Figures and Tables

Frequently asked questions

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